What is a Coverdell Education Savings Account (previously known as Education IRA)?

With an Education Savings Account (ESA), you can invest in the future of a child — tax-deferred and federal tax-free for elementary, secondary and higher education expenses.

It was created as a tax-deferred trust account by the U.S. government to assist families in funding educational expenses for beneficiaries who must be 18 years old or younger when the account is established. The age restriction may be waived for special needs beneficiaries. While more than one ESA can be set up for a single beneficiary, the total maximum contribution per year for any single beneficiary is $2,000. The student must disburse funds by age 30.

Reap the benefits

A coin being deposited into a piggybank.

Tax savings

Tax-deferred funds for child’s education

Investment options

Choose from savings, money market, or certificates

A hand collecting money.

Contribution limit

Up to $2,000 annually

Save for education

Can cover school expenses from K- college

Tax-free withdrawals

If you use the money for a qualified purpose, it’s tax-free

Tax-free earnings

Interest earned is tax-free1

College Savings Calculator

How much should I be saving for college?

Frequently Asked Questions

Tax-deferred savings for all things education
Get tax-free growth and tax-free withdrawals for school expenses.

1 Consult your tax advisor about Coverdell Education Savings Account (ESA) advantages.