Overall, findings indicate that millions of American families continue to invest in higher education for their children, and see 529 plans as a good choice for their investments,” said Joan Marshall.
Lexington, KY (PRWEB) April 27, 2011
The College Savings Plans Network (CSPN), the nation’s authority on 529 College Savings Plans, announced that American families’ total investments in 529 plans reached a record high of $157.4 billion in 2010, according to its latest biannual 529 Report. The report is based on data aggregated exclusively by CSPN from the country’s 104 savings and prepaid tuition programs and examines 529 plan assets, contributions and distributions from Jan. 1, 2010 to Dec. 31, 2010. The 2010 year-end report shows that saving for college has remained a priority for American families, with more than half (54 percent) of all 529 plan accounts receiving contributions last year.
“Overall, findings from the 2010 529 Report indicate that millions of American families continue to invest in higher education for their children, and see 529 plans as a good choice for their investments,” said Joan Marshall, Chair of CSPN and Executive Director of the College Savings Plans of Maryland. “This exclusive, unbiased data collected by CSPN from our members responsible for administering 529 plans across the country shows that the average 529 plan account balance increased 18 percent during 2010. We are very pleased to see this nationwide account balance grow to reach an all-time high, in that it reflects net contributions, distributions, and investment performance.”
Highlights of the 529 Report:
The average balance of a 529 plan account in 2010 was $15,492 – an 18 percent increase from 2009. “While this growth is a welcome trend, it is important to note that the current account balance in a 529 plan is still less than today’s one-year total average cost of attending an in-state public college,” said Marshall. “We are continuing to see more families using 529 plans to save for higher education, but we clearly have a long way to go to achieve our vision of helping all families save for future higher education expenses and reduce their reliance on student loan debt.”
Contributions to new and existing accounts nationwide exceeded $18 billion in 2010. More than half (54 percent) of all 529 accounts received a contribution, and approximately 1.1 million (11 percent) 529 accounts took a distribution.
Assets under management in 529 plans increased 11.5 percent in 2010 net of contributions and distributions from the plans, as compared with a 15 percent increase reported for the S&P 500 and a 5.5 percent increase reported for the Barclays Capital Aggregate Bond Index. “The returns of individual investment options in 529 plans vary due to the account holder’s ability to invest in a variety of strategies including fixed income, equities, guaranteed return or a blend of these,” said Marshall. “A majority of individual options offered positive returns in 2010.”
The 529 Report is based on 2010 year-end data collected from administrators of all 104 529 savings and prepaid tuition programs. 529 Report data is aggregated by CSPN twice a year to provide the market with the most timely, accurate information available on 529 plans. For more information on the CSPN 529 Report plus resources and tools families can use to make informed decisions about saving for college, visit http://www.CollegeSavings.org.
About College Savings Plans Network (CSPN)
College Savings Plans Network (CSPN) is the only unbiased source for information on Section 529 College Savings Plans, one of the most popular, convenient and tax-advantaged ways to save for college. CSPN is a not-for-profit association affiliated with the National Association of State Treasurers (NAST) that brings together state administrators of 529 savings and prepaid plans as well as their private sector partners. Information that families of all income levels can use to make informed saving decisions is available on CSPN’s website, http://www.CollegeSavings.org.