Q. Which state has the best 529 plans?
A. If your state offers state tax incentives to participate a 529 plan, generally that will make your home state's 529 plan the best option for you.
If your resident state doesn't offer any tax incentives for 529 plan savings, you are free to shop around other states' 529 plans, in this case, your top consideration will be cost and investment options.
A new survey of college savings plans rated the following 4 states' 529 plans:
Alaska, Maryland, Nevada, and Utah.
We will use the Nevada's 529 plans as an example to illustrate why it's one of the best 529 plans, it offers 5 options (the prepaid option is only available for residents).
A. If your state offers state tax incentives to participate a 529 plan, generally that will make your home state's 529 plan the best option for you.
If your resident state doesn't offer any tax incentives for 529 plan savings, you are free to shop around other states' 529 plans, in this case, your top consideration will be cost and investment options.
A new survey of college savings plans rated the following 4 states' 529 plans:
Alaska, Maryland, Nevada, and Utah.
We will use the Nevada's 529 plans as an example to illustrate why it's one of the best 529 plans, it offers 5 options (the prepaid option is only available for residents).
- Prepaid tuition plan: a contract-type prepaid plan, which can be purchased to cover between 1 to 5 years of future tuition either on a lump sum or installment basis.
- Putnam 529 for America is a broker-sold 529 saving plan, which is sold only through financial advisors. Using an advisor means you get the benefit of advice and expertise of an investment professional, but may mean you pay sales charges or incur other fees that are used to compensate the advisor.
- SSgA Upromise 529 Plan is a direct-sold 529 savings plan, which allows investors to purchase directly from the plan manager. You will have to rely on your own research to identify your best options, or you can hire a fee-based financial planner. Direct-sold 529 plans are approved and monitored by each state and are managed by professional investment firms. There are no sales charges with these plans.
- The Vanguard 529 Savings Plan is a direct-sold 529 savings plan, which allows investors to purchase directly from the plan manager. You will have to rely on your own research to identify your best options, or you can hire a fee-based financial planner. Direct-sold 529 plans are approved and monitored by each state and are managed by professional investment firms. There are no sales charges with these plans.
- USAA 529 College Savings Plan is a direct-sold 529 savings plan, which allows investors to purchase directly from the plan manager. You will have to rely on your own research to identify your best options, or you can hire a fee-based financial planner. Direct-sold 529 plans are approved and monitored by each state and are managed by professional investment firms. There are no sales charges with these plans.
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