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How College Savings May Impact Public Benefits

There are many ways to save for college and many different types of college savings accounts. The Save for College Program provides an opportunity for you to open one of two college savings account options that can be connected to your child’s scholarship account.

This page has information about how opening and depositing money into each of these kinds of accounts may impact your eligibility (as the account owner) for public benefits. It does not describe the potential effect on a child’s own public benefits when they get to college.

College savings account options

1

NY’s 529 College Savings Program Direct Plan Account

(a type of investment account specifically created to help families save for college and career training)

Learn More
2

Amalgamated Save for College Bank Account

Learn More

NYC Kids RISE does not provide investment advice
or recommend any particular kind of college savings account.
Every family’s financial circumstances are different,
and you should consider your own circumstances
before saving or investing
.

For more information about college savings options available through the Save for College Program, visit nyckidsrise.org/options.

The information below gives a summary of how each benefit may be affected by saving in each of these college savings options. It also lists who to contact to discuss your specific questions and circumstances about each benefit.

NYC scholarship account

Because the NYC Scholarship Account is owned and managed by NYC Kids RISE, money in the NYC Scholarship Account will not affect existing or future public benefits while held in the account. NYC Kids RISE will provide more information in future years on how spending the money in a student’s NYC Scholarship Account may impact that student’s public benefits when they get to college.

For more information, call 833-KID-RISE (833-543-7473).

Your own college savings account

Please read the information below to understand how your family’s public benefits may be affected by either of the college savings account options. The table below also lists who to contact for more information. Note that the resource limit amounts and other rules can change over time. Contact the benefits agency using the contact information below to learn more about current resource limits for each of the benefits.

There will be no effect on the following benefits of having or depositing money into an NYC Scholarship Account OR your own college savings account:

  • WIC (Special Supplemental Nutrition Program for Women, Infants, and Children)
  • Free and reduced-price lunch
  • Medicare and Medicare Savings Plus
  • SSDI (Social Security Disability Insurance)
  • LIHEAP (Low Income Home Energy Assistance Program)
  • CHIP (Children’s Health Insurance Program)

There is a possible effect on the following benefits of having or depositing money into your own college savings account:

  • NYCHA (New York City Housing Authority) housing
  • NYCHA’s Section 8 program
  • Affordable Housing (Housing subsidized by the NYC Department of Housing Preservation and Development or Housing Development Corporation)
  • Medicaid
  • Emergency LIHEAP
  • Public Assistance (TANF/Temporary Assistance for Needy Families, cash assistance, welfare, family assistance, or safety net assistance)
  • Food Stamps/SNAP

Specific information by benefit

The table below gives a summary of how each benefit may be affected by saving in each of these college savings options. It also lists who to contact to discuss your specific questions and circumstances about each benefit.

WIC (Special Supplemental Nutrition Program for Women, Infants, and Children)

529 ACCOUNT

No – There is no resource test for WIC eligibility determinations.

BANK SAVINGS ACCOUNT

No – There is no resource test for WIC eligibility determinations.

CONTACT INFORMATION

WIC Office
42-71 65th Pl
Woodside, NY 11377
(718) 715-7001

Free and reduced-price lunch

529 ACCOUNT

No.

BANK SAVINGS ACCOUNT

No.

CONTACT INFORMATION

Lunch is free for all NYC public school students

Medicare and Medicare Savings Plans

529 ACCOUNT

No – Medicare is not a means-tested benefit and does not have a resource test.

BANK SAVINGS ACCOUNT

No – Medicare is not a means-tested benefit and does not have a resource test.

CONTACT INFORMATION

Queens Community
Medicaid Office
4512 32nd Pl, Long Island
City, NY 11101
(718) 752-4540

SSDI/Disability (Social Security Disability Insurance)

529 ACCOUNT

No – SSDI is not a means-tested benefit and does not have a resource test.

BANK SAVINGS ACCOUNT

No – SSDI is not a means-tested benefit and does not have a resource test.

CONTACT INFORMATION

Social Security Office
31-08 37th Ave,
Long Island City, NY 11101
(800) 772-1213

Low Income Home Energy Assistance Program (LIHEAP)

529 ACCOUNT

No – There is no resource test for LIHEAP eligibility determinations.

BANK SAVINGS ACCOUNT

No – There is no resource test for LIHEAP eligibility determinations.

CONTACT INFORMATION

NYC Human Resources
Administration/HEAP
PO Box 1401
Church Street Station
New York, NY 10008
(212) 331-3126

Emergency Low Income Home Energy Assistance Program (LIHEAP)

529 ACCOUNT

Possibly – Savings in this account count as a resource
and could affect this benefit.

To receive Emergency LIHEAP, households are allowed up to $2,000 in resources and up to $3,000 in resources if a household member is more than 60 years old.

BANK SAVINGS ACCOUNT

Possibly – Savings in this account count as a resource
and could affect this benefit.

To receive Emergency LIHEAP, households are allowed up to $2,000 in resources and up to $3,000 in resources if a household member is more than 60 years old.

CONTACT INFORMATION

NYC Human Resources
Administration/HEAP
PO Box 1401
Church Street Station
New York, NY 10008
(212) 331-3126

New York City Housing Authority (NYCHA) Housing

529 ACCOUNT

No – the total amount of savings in a 529 account is not counted.

NYCHA will not count any self-reported interest earned in the 529 account towards your income.

BANK SAVINGS ACCOUNT

Possibly – The total amount of savings in a bank account
is not counted.

However, NYCHA can count any self-reported interest earned in a traditional savings account towards your income.

CONTACT INFORMATION

NYCHA’s Customer Contact Center
(718) 707-7771

New York City Housing Authority’s (NYCHA’s) Section 8 Program

529 ACCOUNT

No – the total amount of savings in a 529 account is not counted.

NYCHA will not count any self-reported interest earned in the 529 account towards your income.

BANK SAVINGS ACCOUNT

Possibly – The total amount of savings in a bank account
is not counted.

However, NYCHA can count any self-reported interest earned in a traditional savings account towards your income.

CONTACT INFORMATION

NYCHA’s Customer Contact Center
(718) 707-7771

Affordable Housing (Housing subsidized by the NYC Department of Housing Preservation and Development or Housing Development Corporation)

529 ACCOUNT

Possibly – If all of your assets are worth less than $5,000, the interest they earn is counted toward your
income.

If all of your assets are worth more than $5,000, either the interest they earn or 0.06% of their value is added your income, whichever amount is greater.

(“Assets” includes all the money in this account and any other savings or assets you may have.)

BANK SAVINGS ACCOUNT

Possibly – If all of your assets are worth less than $5,000, the interest they earn is counted toward your
income.

If all of your assets are worth more than $5,000, either the interest they earn or 0.06% of their value is added your income, whichever amount is greater.

(“Assets” includes all the money in this account and any other savings or assets you may have.)

CONTACT INFORMATION

NYC Housing Connect
212-863-5610

Children’s Health Insurance Program (CHIP)

529 ACCOUNT

No – There is no resource test for CHIP eligibility determinations.

BANK SAVINGS ACCOUNT

No – There is no resource test for CHIP eligibility determinations.

CONTACT INFORMATION

Queens Community
Medicaid Office
4512 32nd Pl,
Long Island City, NY 11101
(718) 752-4540

Medicaid

529 ACCOUNT

Possibly – There are no Medicaid resource limits for children, parents with a dependent child, or pregnant women (MAGI group).

There are resource limits for the blind, disabled or persons 65 years old or older (non-MAGI). Certain non-MAGI groups are exempt from the resource test (e.g., under 21 ADC-related). This resource test varies depending on the category of eligibility and household size.

Withdrawals during the look-back period (the five years before a Medicaid application) could delay the disbursement of Medicaid payments. This account may need to be spent down first before becoming eligible for Medicaid.

BANK SAVINGS ACCOUNT

Possibly – There are no Medicaid resource limits for parents and pregnant women. There are resource limits for the blind, disabled or persons 65 years old or older.

Withdrawals during the look-back period (the five years before a Medicaid application) could delay the disbursement of Medicaid payments. This account may need to be spent down first before becoming eligible for Medicaid.

CONTACT INFORMATION

Queens Community
Medicaid Office
4512 32nd Pl,
Long Island City, NY 11101
(718) 752-4540

Food Stamps/SNAP

529 ACCOUNT

No – Funds in a 529 account are exempt from counting towards the resource limit test.

BANK SAVINGS ACCOUNT

Possibly – Households with elderly or disabled members and “categorically eligible” families are not subject to the gross income test. Food stamps are not impacted if the savings account is just for college savings.

Non-categorically eligible families’ food stamps could be affected. This includes households with income that is more than 200% of the Federal Poverty Level ($49,200 for a family of four in 2017) and households with members that have been sanctioned. If you have resources of $2,250 ($3,250 for a household with a person who is at least 60 years old or has a disability), your Food Stamps could be cut.

CONTACT INFORMATION

Food Bank For NYC SNAP Benefits Helpline
(212) 894-8060

Public Assistance (Temporary Assistance for Needy Families /TANF, Cash Assistance, Welfare, Family Assistance or Safety Net Assistance)

529 ACCOUNT

No – Since this account is established for the single purpose of paying for educational needs and cannot be used for any other purposes, the funds are exempt from the resource limit test.

BANK SAVINGS ACCOUNT

Possibly – Families are allowed up to $1,400 in a separate savings account dedicated solely for tuition at a two-year or four-year college without the funds counting towards the resource test.

If savings are used for other purposes, the full account amount will count towards the resource test and could affect benefits.

Families who are applying for public assistance, including families who previously received public assistance and are reapplying, who have any savings whether it is for tuition or not, will have to pass a resource test. If you have more than $2,000 in assets (or $3,000 if someone is age 60 or older), you could not be eligible for public assistance.

CONTACT INFORMATION

Human Resources Administration (HRA) Helpline
(718) 557-1399

Supplemental Security Income (SSI)

529 ACCOUNT

Yes – Savings in this account count as a resource and could affect eligibility.

To receive SSI, individuals are allowed up to $2,000 in resources and couples up to $3,000 in resources, unless the money is invested in an ABLE Account.

BANK SAVINGS ACCOUNT

Yes – Savings in this account count as a resource and could affect eligibility. To receive SSI, individuals are allowed up to $2,000 in resources and couples up to $3,000 in resources.

CONTACT INFORMATION

Social Security Office
31-08 37th Ave.
Long Island City, NY 11101
(800) 772-1213

Ready to open an account? Click one of the links below for instructions.

For free, one-on-one support with fitting college savings into your overall financial picture, consider visiting one of the NYC Financial Empowerment Centers located throughout the city. At the Financial Empowerment Centers, you can meet one-on-one with a professional financial counselor who can help you tackle debt, improve your credit, create a budget, open a bank account, save and plan for your future, and more. You can also get information about saving for your child’s college education and making a plan to start saving. To schedule an appointment at a Financial Empowerment Center near you, call 311 or visit nyc.gov/dca.

 

The NYC Kids RISE Save for College Program is a scholarship and savings program administered by NYC Kids RISE Inc., a nonprofit, in partnership with the NYC Department of Education and the City of New York. NYC Kids RISE is neither affiliated with, nor an authorized distributor of, New York’s 529 College Savings Program and does not solicit investments or provide investment advice. The City of New York and the NYC Department of Education offer no endorsement or recommendation about, and do not control, own or are affiliated with the NY 529 Program Manager and any particular college savings or other investment vehicle, including ones which families may learn about through the Save for College Program.

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