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If the Vanguard plan is not a 529, then while it may be state tax deductible it may not be federally deductible.

No 529 is federally deductible.

For the original poster, I've had a 529 in Colorado since near the beginning - they have had 4 different companies administering the program since it's inception(which I find a PITA as far as tracking the account). Vanguard only took it over within the past few months. However, you do not pay state income tax on your contributions in the year you make them so you get a 4-5% return from that in the year of the contributions. It does make it attractive to use the state's plan.

Be sure to educate yourself about the sunset provisions for 529s and the proposed changes in the handling of the gift/estate tax provisions. has been keeping up on them and ususally has info on the home page.

I would hesitate to start saving for a child's education until the child is born. It's my bias at age 50 from having friends who wanted but never were able to have children. I have 3 kids and started saving when we had the first and it held us in good stead.

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