“Heresy! Heresy!”
“Everyone knows that a 529 fund is the best way to save for your child’s education!!”
Before you throw the rotten tomatoes…
I have nothing against 529 plans. They are a fantastic opportunity to save for your child’s college expenses. I do, however, have a complaint against the high fees that some of the plans are charging.
In my recent study of 529 plans I came to three conclusions:
- Some plans charge exorbitant fees,
- Almost all of the plan literature is hard to wade through and compare to competing plans, and
- It needn’t be so complicated.
I set out to determine whether the high fees charge by many 529 programs offset the tax advantage. Below is a spreadsheet I wrote to compare three scenarios. (You’ll need to click on the image to make it readable).
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