Buoyed by record sales, assets in 529 college savings plans reached an estimated $75.1 billion at March 31, up 38% from the year earlier, according to data from Financial Research Corp. that was released Tuesday by the College Savings Foundation.
Estimated net sales during the first quarter were $5.1 billion, the largest quarterly net sales on record.
"Competition among plan providers for expiring contracts with the states is greater than ever," Brian Boswell, an analyst at Financial Research, a Boston consulting firm, said in a press release. "In many cases 529s are providing a broader investment selection and lower fees, making the programs more attractive."
The College Board said the average annual cost of attending a four-year public college or university rose 6.6%, to $12,127, in the past year and the cost to attend a four-year private college or university went up 5.7%, to $29,026. Assuming 5% annual increases in these costs, the total would top $100,000 a year for public colleges within 15 years, and $200,000 a year for private colleges.
The College Savings Foundation's first-quarter report on asset types in 529 college savings plan found that the fastest-growing category was the "static" portfolio, with permanent underlying investments such as a target-risk or a specific asset-class portfolio.
Load portfolios account for the bulk of assets, 62.4% of the $27.3 billion examined, and of sales, at 60%.
