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Financial advisor here. We stopped opening 529 plans for clients because we don’t provide any value there other then setting plan for contributions and one-time allocation help. Most states have a similar non-advisor version.
It’s also likely not every trade but rather the initial contribution. It also should have breakpoints as you get more in assets there.
The asset fee on our local plan is .5%. It may not be worth whatever plan they are recommending if the fees are that much higher.
The 3.5% is likely the “A share” commission which should only be a one time fee and then a trail of .25% every year after.
I have a MI and WI 529s and both have been very easy to manage (I believe both are administered by TIAA so the interface is nearly identical).
Check out savingforcollege.com They have performance information for all the 529s as well as fee information so you can compare.
We have the Utah 529.
Our state plan didn’t offer tax incentives so we went with Utah too
Mentor
Never hold a dollar of assets in Edward Jones or another high fee broker.
Move it to a low fee 529 like the Vanguard one or the other ones mentioned here immediately.
You’re allowed one transfer per year for 529s. Your other accounts just make sure they are transferred in-kind and there are not any tax consequences.
I just went with Vanguard since my state doesn’t offer incentives, but see if your state offers any tax incentives
Thanks! I'll check out Vanguard and the various state plans. My state offers a deduction even if you're not invested in their state plan.
Definitely check your state rules. For Arkansas, you can only deduct up to $3000 per year for a non-Arkansas 529 account. If I go with the Arkansas 529 account, I can deduct up to $5000 per year.
Our state is pretty generous with the deduction for contributions to out of state plans. Although, we can't afford to contribute much to the 529s right now (prioritizing retirement savings first).
Generally, your state will have a state plan, but you can also use another state’s plan depending on whether yours gives you a tax break.
Y'all - I did some research. The 3.5% EJ commission is on EVERY buy like I thought. What a ripoff. Also, I found out the Florida 529 allows you to customize your investment options and they have no admin fees. So, you could invest the 529 funds in VIIX (0.02% expense ratio) and no other fees! My state still allows me to take the state income tax deduction if I contribute to another state's 529. So Florida may not be the best option for all. Interestingly, Vanguard's individual 529 portfolios have much higher expense ratios: https://investor.vanguard.com/investment-products/list/529-portfolios.
One important detail I forgot to look into is residency. Apparently, you have to be a Florida resident to open a Florida 529 savings plan.
Virginia529 in, you know, Virginia.
Yeah, I'm now realizing this. I'm going to stop contributing there and just open up an account with Virginia529.
Just do Utah
That’s what I did since my state (CA) doesn’t have any benefits.
Mnsaves.org
I thought you had to open a 529 in the state you liv. I use scholarshare for CA, management fees are .05%. Should I be looking elsewhere?
I believe most state 529s don't have residency requirements. I looked at the Utah and NH plans, and they didn't require you to be a resident of those states. I already have a Fidelity account, so that's why I looked at the NH plan (it's managed by Fidelity). Bottom line, I'm looking for low asset management fees and underlying fund expense ratios and the ability to choose funds to invest in. My state's 529 has pretty high fees and the investment options are predetermined.