# AI boom makes parents question college savings plans

> As artificial intelligence reshapes the job market and higher education, families are rethinking whether 529 college savings plans still make sense.
- Title: AI boom makes parents question college savings plans
- Summary: As artificial intelligence reshapes the job market and higher education, families are rethinking whether 529 college savings plans still make sense.
- Keywords: 529 plans, college savings, artificial intelligence, higher education, education costs, job market, financial planning, Business Insider
- Source: Business Insider — https://businessinsider.com/ai-kids-college-529-savings-rethink-2026-11
- Author: Henry Chandonnet
- Published: 2026-11-14T11:00:01.27+00:00
- Read time: 2 min
- Topics: 529 plans, college savings, artificial intelligence, higher education, education costs, job market, financial planning, business, technology
## Nataliya Konovalova halves college savings
When her sons were babies, Nataliya Konovalova set up 529 plans. Now aged eight and ten, she has halved contributions, doubting they will attend traditional four-year college.

> I honestly don't think they will go to a traditional four-year college.
## AI tightens entry-level job market
Konovalova discussed AI's impact on hiring with her husband, who works in tech. They concluded AI is tightening the entry-level job market for graduates.
## 529 plans grew 80% since 2010
For decades, 529 tax-advantaged plans have been the standard for education savings. The number of plans across the US has grown eighty percent since two thousand ten.
## AI challenges higher education value
Students use AI to cheat. Tech executives say chatbots are better than human teachers. Silicon Valley is pitching AI-powered college alternatives, making degree value harder to predict.
## One quarter of parents rethinking savings
Of nine hundred twenty-one K through eleven parents polled by Intuit Credit Karma slash Harris, more than a quarter said they are rethinking how much to save for education.
## Microsoft AI CEO unsure about college
A mother of two asked Microsoft AI CEO Mustafa Suleyman whether she should save for college in two thousand twenty-five. He laughed and said probably not, then corrected himself.

> I don't know. It's really hard to judge.
## David Graham stops funding 529s entirely
David Graham, a fifty-two-year-old retired physician from Billings, Montana, stopped funding his children's 529 plans two years ago. He estimates his son has fifty thousand dollars and his twin girls have fifteen thousand dollars each.

> If he wants to go to school, I'll just write a check.
## Financial planner sees thirty percent redirecting
Michael Reynolds, a certified financial planner from Indianapolis, said about thirty percent of parents he worked with were redirecting funds away from 529s as they doubt college's future value.

> More and more conversations are happening around: Do we put all our eggs in this basket?
## Omar Khan chooses taxable brokerage accounts
Omar Khan, a millennial father of two, invests for his children via taxable brokerage accounts instead of a 529. He wants flexibility for whatever his kids' futures require.
## Matthew Crowson hopes 529 rules expand
Matthew Crowson, a thirty-nine-year-old physician at Harvard Medical School, continues saving in a 529 for his sons aged three and five. He hopes the government will expand what counts as qualified education.

> That's a very cautiously optimistic take.
## 529 rules have expanded before
In two thousand eighteen, the government allowed parents to use 529 funds for private high schools. In two thousand twenty-four, parents could roll over money into a Roth IRA tax-free.
## Key takeaway

Parents are reducing or abandoning 529 college savings plans as AI disrupts higher education and entry-level hiring, with some redirecting funds to more flexible accounts.