If you’ve heard about Iowa’s Education Savings Accounts (ESAs) but aren’t sure what they do—or whether they’re too good to be true—this post is for you. We’ll walk through exactly how ESA funds must be used, and then show the kinds of educational expenses families can cover beyond tuition. No jargon. No hidden caveats. Just clarity
What Is an ESA (and How It Works in Iowa)
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An ESA is a state-managed account (not your personal bank account) that holds public education funds directed toward a student.
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In Iowa, the program is called the Students First Act ESA. The state funds the ESA and contracts with Odyssey to administer the application process, vendor marketplace, and payments.
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For the 2025–26 school year, each eligible student receives $7,988 in ESA funds (Iowa Department of Education).
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The first priority of these funds is private school tuition and fees at an Iowa-accredited nonpublic school. That requirement is built into the law.
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Only after tuition and fees are paid can any leftover funds be used for other educational expenses—but only through approved vendors via Odyssey’s Marketplace. Purchases outside that marketplace are ineligible for reimbursement.
In short: ESA funds aren’t a free-spending check. They’re tightly controlled to ensure they serve educational purposes, with direct vendor payments handled by Odyssey
What You Can Pay For (Beyond Tuition)
Once your child’s tuition and fees are covered, any remaining ESA funds can go toward a wide variety of educational supports. Below is a practical list drawn from Iowa’s ESA rules and Odyssey’s marketplace guidance.
After tuition and fees are covered, ESA funds don’t just sit idle—they can be put toward a wide range of learning needs. The state’s rules and Odyssey’s marketplace guidance make it clear that these dollars are for education only, but within that framework families have real flexibility. Some of the most common approved uses include:
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Textbooks & Curriculum – Core and supplemental books, full curriculum packages, workbooks, and specialty programs.
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Tutoring / Instructional Services – Certified tutors or tutoring centers, remedial instruction, or enrichment lessons.
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Special Education / Therapy Services – Speech therapy, occupational therapy, psychological assessments, and behavioral supports.
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Digital Learning / Software – Subscriptions to online learning platforms, software programs, or virtual courses.
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Computers & Tech Devices – Laptops, desktops, or tablets (when used for educational purposes).
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Testing Fees – Standardized assessments, AP exams, ACT/SAT, and credentialing tests.
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Instructional Materials & Supplies – Science lab kits, art supplies, musical instruments, and calculators.
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Transportation – When directly tied to private school attendance (if allowed by ESA rules)
How It Might Work in Practice
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Imagine a student whose school tuition is $6,200. With roughly $1,788 left in the ESA, the family could use part of the balance for a weekly math tutor and the rest for a Chromebook purchased through an approved vendor.
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Or picture a family paying $7,000 in tuition. With nearly $1,000 left, they could cover weekly speech therapy sessions for their child through a licensed provider listed in Odyssey’s marketplace.
These simple illustrations show that ESA funds aren’t just about tuition—they can also make room for tutoring, technology, or specialized services that directly support a child’s learning.
Why This Framework Matters
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Strong accountability — You can’t just spend the money anywhere. It must be for educational use, via authorized vendors, and be approved by the system.
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Flexibility within constraints — While tuition is the first use, the program acknowledges that education often requires many supplemental supports. ESA funds can extend beyond that.
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Transparency — Because purchases go through Odyssey, there’s a clear audit trail; families and the state can see exactly how funds are used.
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No reimbursements — You don’t front the cost and wait to get paid back. The vendor is paid directly.
For taxpayers wondering whether ESA funds will be abused, the structure makes it difficult to stray outside of permitted educational spending
A Practical, Focused Program
Education Savings Accounts are practical tools for Iowa families who want options. They start with tuition, but they don’t end there. By covering everything from textbooks to therapy, ESAs are designed to make education more accessible, personalized, and effective.
For parents and grandparents new to the concept, or even those who may doubt its scope, the takeaway is simple: ESAs are about more than tuition—they are about giving families the resources to meet their children’s full educational needs.