No. Parents are not relegated to buying a 529 plan in the state in which they live; parents have the option to buy a 529 plan in other states. It is prudent to research state deductions and determining if your state offers a deduction for in-state plans. If the deduction is small, its benefit may be irrelevant when compared to other state options that offer lower fees and have more and higher quality investment choices. In other words other state's 529 plan's advantages may outweigh the given deduction for using the in-state 529 plan where you live.