The New Jersey Better Educational Savings Trust (NJBEST) program is the State of New Jersey's affordable and convenient college savings program. It is administered by the New Jersey Higher Education Assistance Authority. In our increasingly complex society and economy, the need for postsecondary education has never been greater. The life-long economic benefits of a college education make it a highly worthwhile investment.
For New Jersey families, purchasing a home, sending a child to college, and providing for retirement are vital savings and investment goals. NJBEST is designed to help families invest in a child's educational future.
The tax advantages, affordability, and other features of the NJBEST program can help you put college within your reach.
What is NJBEST? The New Jersey Better Educational Savings Trust (NJBEST) program is the State of New Jersey's affordable and convenient college savings program.
NJBEST makes it possible for anyone who wants to save for future college costs (the contributor) to set up an account in the name of a specific person (the beneficiary). Contributions to NJBEST accounts are invested, and when the beneficiary is ready to attend an institution of higher education the savings are withdrawn and used for college expenses (tuition, fees, books, room and board, etc.). Earnings on the account are free from state income tax if the savings are used for higher education, and federal taxes on the earnings are deferred until the savings are used to pay for college costs.
Special features of NJBEST include a $500 scholarship if the beneficiary attends college in New Jersey and meets other saving criteria, and the exclusion of up to $25,000 in NJBEST savings from consideration in the award of State need-based financial aid.
What are the advantages of NJBEST?
When used to pay eligible expenses, the earnings on NJBEST accounts are state tax free, and federally tax deferred until withdrawn. When withdrawn, the income is taxed at the beneficiary's (lower) income tax rate.
There is no application fee to open an account.
There is professional investment management by the New Jersey Department of Treasury, Division of Investment.
The first $25,000 in savings is exempt from New Jersey need-based financial aid consideration.
A NJBEST Scholarship is available for those who qualify.
Who is administering NJBEST?
The Higher Education Student Assistance Authority (HESAA) is administering NJBEST. By making use of the personnel and financial aid expertise already available at NJOSA, costs for establishing and maintaining the program are minimized.
