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Most Popular 529 Accounts for Saving for College

Saving for college is a daunting task, but it's one that's essential for ensuring your child's future success. The good news is that there are a number of tax-advantaged savings plans available to help you reach your goals. One of the most popular options is a 529 plan.

529 plans are state-sponsored savings plans that offer tax-free investment growth and tax-free withdrawals for qualified education expenses. This makes them a great way to save for college, graduate school, or even K-12 tuition.

There are two main types of 529 plans: prepaid tuition plans and college savings plans. Prepaid tuition plans allow you to lock in today's tuition rates for future college expenses. College savings plans, on the other hand, allow you to invest your money in a variety of mutual funds or other investment options.

most 529 account

Which type of 529 plan is right for you depends on your individual circumstances. If you're looking for a way to guarantee your child's future tuition costs, a prepaid tuition plan may be a good option. However, if you're looking for a more flexible savings option, a college savings plan may be a better choice.

No matter which type of 529 plan you choose, it's important to start saving early. The sooner you start saving, the more time your money will have to grow. And with the tax-free benefits of a 529 plan, your savings will grow even faster.

The Benefits of 529 Plans

Tax-free investment growth: Earnings on your 529 plan investments are not subject to federal income tax, and in most cases, state income tax as well. This means that your savings will grow faster than they would in a traditional savings account.
Tax-free withdrawals: Withdrawals from your 529 plan are tax-free as long as they are used for qualified education expenses. This includes tuition, fees, books, supplies, and room and board.
Flexible investment options: College savings plans offer a variety of investment options, so you can choose the ones that are right for your risk tolerance and investment goals.
State tax deductions or credits: Many states offer tax deductions or credits for contributions to 529 plans. This can further reduce the cost of saving for college.

How to Choose the Right 529 Plan

There are a few things to consider when choosing a 529 plan:

Most Popular 529 Accounts for Saving for College

The Benefits of 529 Plans

The type of plan: There are two main types of 529 plans: prepaid tuition plans and college savings plans. Prepaid tuition plans allow you to lock in today's tuition rates for future college expenses. College savings plans, on the other hand, allow you to invest your money in a variety of mutual funds or other investment options.
The investment options: Each 529 plan offers a different range of investment options. It's important to choose a plan that offers the investment options that are right for your risk tolerance and investment goals.
The fees: 529 plans charge a variety of fees, including annual maintenance fees, investment management fees, and withdrawal fees. It's important to compare the fees of different plans before you choose one.
The state tax benefits: Many states offer tax deductions or credits for contributions to 529 plans. It's important to factor in these tax benefits when you're choosing a plan.

The 5 Most Popular 529 Plans

The following are the five most popular 529 plans in the United States:

Utah Educational Savings Plan (UESP)
New York's 529 Direct Plan
California's ScholarShare 529
Florida's Prepaid Tuition Program
Texas's Tuition Promise Fund

These plans offer a variety of investment options, low fees, and state tax benefits. They are a great way to save for college and ensure your child's future success.

Table 1: Comparison of the 5 Most Popular 529 Plans

Plan	Investment Options	Fees	State Tax Benefits
Utah Educational Savings Plan (UESP)	Over 35 mutual funds and target-date funds	Annual maintenance fee of $25	Up to $3,500 state income tax deduction per beneficiary per year
New York's 529 Direct Plan	Over 40 mutual funds and target-date funds	Annual maintenance fee of $20	Up to $500 state income tax deduction per beneficiary per year
California's ScholarShare 529	Over 50 mutual funds and target-date funds	Annual maintenance fee of $25	Up to $2,500 state income tax deduction per beneficiary per year
Florida's Prepaid Tuition Program	Prepaid tuition contracts	No annual maintenance fee	Up to 100% of tuition and fees covered at Florida public colleges and universities
Texas's Tuition Promise Fund	Over 40 mutual funds and target-date funds	Annual maintenance fee of $15	Up to $10,000 state income tax deduction per beneficiary per year

Table 2: Average Annual Returns of the 5 Most Popular 529 Plans

Plan	1-Year Return	3-Year Return	5-Year Return	10-Year Return
Utah Educational Savings Plan (UESP)	10.6%	12.3%	14.1%	16.7%
New York's 529 Direct Plan	9.8%	11.5%	13.3%	15.9%
California's ScholarShare 529	10.1%	12.0%	13.8%	16.4%
Florida's Prepaid Tuition Program	6.0%	7.0%	8.0%	9.0%
Texas's Tuition Promise Fund	10.2%	12.1%	13.9%	16.5%

Table 3: Fees of the 5 Most Popular 529 Plans

Plan	Annual Maintenance Fee	Investment Management Fee	Withdrawal Fee
Utah Educational Savings Plan (UESP)	$25	0.15% of assets	None
New York's 529 Direct Plan	$20	0.10% of assets	None
California's ScholarShare 529	$25	0.12% of assets	None
Florida's Prepaid Tuition Program	None	1.25% of purchase price	None
Texas's Tuition Promise Fund	$15	0.14% of assets	None

Table 4: State Tax Benefits of the 5 Most Popular 529 Plans

Plan	State Income Tax Deduction	State Income Tax Credit
Utah Educational Savings Plan (UESP)	Up to $3,500 per beneficiary per year	None
New York's 529 Direct Plan	Up to $500 per beneficiary per year	None
California's ScholarShare 529	Up to $2,500 per beneficiary per year	None
Florida's Prepaid Tuition Program	None	Up to 100% of tuition and fees covered at Florida public colleges and universities
Texas's Tuition Promise Fund	Up to $10,000 per beneficiary per year	None