As a followup to my recent article on 529 plans, I thought I’d highlight the most recent batch of 529 plan ratings from Consumer Reports. For those that aren’t familiar with them, 529 plans are tax-advantaged savings plans that are designed to encourage people save for future college costs.
The following list of the best 529 plans is based on investment flexibility, fees and expenses, and 2008 performance. While it’s tough to learn much from performance during such a dismal year, some plans have clearly been holding inappropriate allocations. For example, one of Utah’s age-based portfolios, which is targeted at students over the age of sixteen (i.e., with just 1-2 years before they need the money), was so heavily weighted toward stocks that it lost over 26% last year.
With that as a backdrop, here are the ratings…
The five best 529 plans
- Path2College 529 Plan (Georgia; TIAA-CREF)
- College Savings Iowa (Iowa; Vanguard/Upromise)
- Bright Start College Savings Program (Illinois; Oppenheimer)
- Mississippi Affordable College Savings Program (Mississippi; TIAA-CREF)
- Direct Portfolio College Savings Plan (Colorado; Vanguard/Upromise)
Note that, as long as you’re using a “college savings plan” as opposed to a “pre-paid tuition plan, ” you’re not locked into a particular school (or even state). See my earlier article for details.
Don’t forget the tax breaks
Another factor to consider is that many 529 plans offer state residents an income tax deduction on at least a portion of their contributions. While that won’t be enough to tip the scales in favor of a fee-laden plan, it might be enough to make a decent plan look great.
Hello there! I could have sworn I’ve been to this blog before but after browsing through some of the post I realized it’s new to me.
Anyways, I’m definitely delighted I found it and I’ll be bookmarking and checking back
often!
You do it by making a plan, reading labels, avoiding certain foods and dieting
under stress. A brand new you in a couple of handfuls of trail
mix for a snack.
I am not sure where you are getting your information, but great topic.
I needs to spend some time learning more or understanding more.
Thanks for magnificent information I was looking for this info for my mission.
If you would like to grow your familiarity simply keep visiting this site and be
updated with the most up-to-date gossip posted here.
I drop a leave a response when I appreciate a post on
a blog or if I have something to contribute to the conversation.
It’s triggered by the sincerness displayed in the article I read. And on this article The Best 529 Plans – 2009 Edition. I was actually moved enough to post a thought 🙂 I do have 2 questions for you if you tend not to mind. Is it only me or do a few of the comments come across as if they are written by brain dead folks? 😛 And, if you are posting on other online sites, I’d like to follow everything new you have to post.
Could you list the complete urls of all your social pages like your linkedin profile,
Facebook page or twitter feed?
Before you guys going thinking Illinois’ plan is all that, you might want to check this out:
http://newsblogs.chicagotribune.com/clout_st/2009/05/treasurer-defends-suv-purchase-from-college-savings-program.html
Yep, just checked, and they still offer Vanguard. I listed Oppenheimer above because that’s what CR listed, but I can only assume that the plan ranks as highly as it does because of Vanguard.
Jeff: Bright Start also has Vanguard funds, don’t they? They added them back in July 2007, though I guess it’s possible that they’ve since dropped them.
I have to assume that Consumer Reports had a mix up on the state of Illinois plan. Our state has two 529 plans: Bright Start and Bright Directions. Bright Start is the program that current State Treasurer is pursuing legal action against them (Oppenheimer) for investing outside the stated guidelines of their Core Bond fund.
http://www.progressillinois.com/2009/4/24/closer-look-bright-start
Bright Directions on the other hand is a pretty decent program. Not the best, but compared to Bright Start, far superior.
I think Bright Start should have been included as one of the 5 worst instead.