Student loan debt is a problem for many in our country. Specifically, for 54% of college students, to the tune of $1.6 trillion.

While this is a multi-faceted problem, including the rising costs of college, transparent college pricing, the college shopping process, and college funding, one aspect of the solutions is only know of by 29% of the country. That’s 529 plans, named after the section of the Internal Revenue Code (aka tax code) that created them. They are a tax advantaged savings and investment vehicle to encourage saving for college. But with only 18% of children under age 18 having a 529 plan, they are an under-used tool.

529 plans are tax advantaged in many ways. Compared to all of the other tax advantaged vehicles, hey are closest to the triple-tax-advantaged HSAs:

• Your state may offer a tax break for contributions to a 529 plan.
• The account grows on a tax deferred basis.
• When the money is withdrawn from the account, if it’s used for qualified college expenses, those withdrawals are also tax free – state and federal!

There are many other advantages and situations for 529 plans to be the right tool in a parent’s tool box for their child, including for apprenticeship programs and K-12 tuition, for repaying a small amount of student loans, and being a type of assets least heavily counted for the calculation of the FAFSA’s Expected Family Contribution (EFC). But the biggest thing is to know they exist, because only then can you figure out if they’re right for you.