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529 Plans Continue to Make the Grade With College Savers

Morningstar's 2014 529 College-Savings Plans Industry Survey shows strong growth, even though returns and fees don't always keep up.

As higher-education costs trend up, 529 college-savings plans remain a compelling choice for college savers. New research released today from Morningstar shows that college savers continue to send sizable new assets to the nation's 84 traditional 529 college-savings plans, even though returns and costs haven't always kept up with similar mutual funds.

Diversified Options Continue to Gain Assets
Assets in 529 plans continued to climb in 2013, reaching nearly $200 billion as of the end of 2013, an increase of 20% from the prior year. Both advisor-sold plans and direct-sold plans (which are used primarily by do-it-yourself investors as well as those working with fee-based advisors) saw an uptick in assets, with direct-sold plans maintaining a slight edge at $102 billion versus $98 billion for advisor-sold plans.  

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