A 529 plan is a tax-advantaged account that lets parents invest for their child's education expenses, and the plans vary by state. The difference between 529 plans and custodial accounts, however, is that 529 plans are reserved strictly for education. Plus, while 529 plan benefits vary by state (i.e., states have different, annual fees, maximum contribution limits and tax deduction limits), you can invest in another state's 529 plan as long as it doesn't require state residency. Below is a list of direct-sold 529 plans by state:Alabama - District of Columbia*None of the states above require you to be a state resident to open a 529 plan. Nevada - Oregon*You can only open a New Jersyey 529 plan if you're a state resident.

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