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5 Top Rated 529 College Savings Plans

Jun 24, 2012

Every year since the 529 plan was implemented, states plans have become better and better. With most states having a 529 plan, a bit of a competition has begun. When you have almost 50 states competing for your college savings dollar, the product they have is going to get better.

According to Morningstar, plans are getting good marks for lower fees and higher quality investments. This is the eighth year 529 plans have been rated. Besides lower fees, investment options have grown stronger.

Six plans have risen to the top of the list for quality, investment options, and low fees. Here are the top 529 plans:

1. T. Rowe Price College Savings Plan and Maryland College Investment Plan.
The Maryland plan run by T. Rowe Price is constructed on well planned funds. They have age based options for asset allocation. Most of the funds are index funds, but if you want actively managed funds they are available.

2. CollegeAdvantage 529 Savings Plan
The Ohio plan has a mix of fund family's. They include Vanguard, PIMCO, Oppenheimer, and GE. Ohio believes clients want a larger variety of funds to choose from. The various funds are becoming more common and that produces lower fees.

3. The Vanguard 529 College Savings Plan
The Nevada based plan feature Vanguards famously popular list of index funds. A $3,000 minimum is required to open an account. This puts off many savers who are starting their college saving. Utah has the same investment option but does without the high minimum investment.

4.Utah Educational Savings Plan
The Utah plan offers Vanguards index funds also. The plan offers a set it and forget option. You can indicate what investments you want your plan to have and every year the investment percentages are adjusted as the child nears college age.

This Virginia based plan has American Funds in its inventory. It's the nation's largest 529 plan by far. American Funds wide range of investments make financial planners happy with their mix and match style of building a 529 plan. Like the others, this one in inexpensive and packed with high quality investments.

Plans that didn't get pick were penalized by confusing investment options, high fees, and below average returns.

Got further questions? Catch me on twitter and DM me @529SavingsPlans or e-mail me at 529CollegePlans at Want to be heard? Leave a reader comment below.

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