Each year, we assign Morningstar Analyst Ratings to college savings plans based on five key pillars: Process, People, Parent, Price, and Performance. We also consider if any plans convey unique benefits, such as local tax breaks, grants, and scholarships, though these usually do not drive the overall outcome. In 2018, Morningstar assigned analyst ratings to 62 plans, which represent more than 95% of assets invested in 529 plans. Morningstar analysts upgraded two plans and downgraded nine.
Morningstar identified 31 plans that it believes to be best-in-class options, assigning these programs Analyst Ratings of Gold, Silver, or Bronze. These plans for the most part follow industry best practices, offering some combination of the following attractive features: low fees, a strong set of underlying investments, a solid manager selection process, a well-researched asset-allocation approach, an appropriate set of investment options to meet investor needs, and strong oversight from the state and program manager. These features improve the odds that a plan will continue to be a strong option for investors. Gold-rated plans have all or a vast majority of these attributes. Silver- and Bronze-rated plans embody most of these qualities but often have some room for improvement.