529 Savings Plans at All Time High

Two recently published reports conclude that funding of 529 college savings plans is significantly on the rise.  One report by Strategic Insight estimates that 529 plan assets reached $220.6 billion at the close of the second quarter of 2014; which is a 4.7 percent increase from first quarter assets.  Figures from the College Savings Plan Network shows the mid-year numbers to be even higher at $244 billion. 

While there may be a small difference in statistics, it is clear that 529 plans are increasingly popular among parents looking to fund their children’s higher education.  A key factor underpinning their high demand is the vehicle’s tax-favored status.  “From an industry asset level perspective, 529 savings plans continue to reach year-over-year all-time highs . . . Therefore, investor interest in 529 plans and saving for education in a tax-efficient manner continues to rise, and especially as part of year-end tax planning.”

See Warren S. Hersch, Studies: Funding of 529 College Savings Plans Hits Record High, Life Health Pro, Sept. 22, 2014.   

Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.