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Morningstar’s Best and Worst 529 Plans
By JLP | April 18, 2008
Here’s a look at Morningstar’s recently published list of the best and worst 529 plans:
The Best
Illinois Bright Start College Savings Program - OppenheimerFunds Inc.
Maryland College Inv Plan - T. Rowe Price
Virginia CollegeAmerica* - Virginia (American Funds)
Virginia Education Savings Trust - Virginia
Colorado Scholars Choice College Savings Program* - Legg Mason, Inc.
The Worst
Ohio Putnam CollegeAdvantage* - Putnam Investment Management
Mississippi Affordable College Savings Program - TIAA-CREF
Mississippi Affordable College Savings Program* - TIAA-CREF
New York 529 College Savings Program - Upromise
Nebraska AIM College Savings Plan* - Union Bank (AIM)
* denotes advisor-sold plans.
You’ll have to read Marta Norton’s Morningstar piece to find out why these plans were on the best and worst list. I will say that fund performance, expenses, and investment choice were the main deciding factors.
As a side note, while putting his post together I decided to check out Saving for College’s 5-Cap ratings for each of these plans. One thing that troubles me is NEARLY EVERY PLAN has an above average 5-Cap rating (the ratings are lower for out-of-state residents). I realize that rating these plans is somewhat subjective. However, it seems as though Saving for College may be a little too generous with their ratings, which almost makes them worthless. I would only use Saving for College as a starting point for 529 plan research.
Topics: College Funding, Investing |