More than ever before, American families are committing to saving for future education expenses by opening a 529 plan, with 10.7 million open accounts at year-end 2011 – a 6.6 percent increase since 2010,” said Hon. Michael Fitzgerald, chair of CSPN.
Lexington, Ky. (PRWEB) April 16, 2012
The College Savings Plans Network (CSPN), the nation’s authority on 529 College Savings Plans, announced that Americans used funds from 1.4 million 529 accounts to pay for college expenses in 2011, according to its 529 Report infographic released today. Total investments in 529 plans reached a record high of $164.9 billion at year-end, including growth from new net contributions and investment returns, an increase of 4.7 percent since 2010.
The report is based on data aggregated exclusively by CSPN from all 107 savings and prepaid tuition programs nationwide, and examines 529 plan assets, contributions and distributions. The report shows that saving for college continues to be a priority for American families, with more than half (52 percent) of accounts receiving contributions in 2011.
“More than ever before, American families are committing to saving for future education expenses by opening a 529 plan, with 10.7 million open accounts at year-end 2011 – a 6.6 percent increase since 2010,” said Iowa State Treasurer Michael Fitzgerald, chair of CSPN. “This exclusive, unbiased data also shows that families that saved with a 529 plan are seeing the reward, with $11.3 billion in distributions made in 2011 to pay for college.”
Today’s 529 Report infographic also shows:
- Contributions to 529 accounts nationwide exceeded $19.7 billion in 2011. While 52 percent of accounts received new contributions, approximately 13 percent of accounts took a distribution to pay for higher education expenses. The 1.4 million 529 plan accounts used to pay for college represent approximately five percent of all U.S. college students, based on the Chronicle of Higher Education’s estimated 22 million students as of 2007-2008.
- The average 529 plan account balance decreased slightly in 2011, from $15,492 to $15,349, attributable to a mixed year for investment performance and a 6.6 percent influx in new accounts, which tend to carry smaller balances as families set out on their path to saving.
- The 2011 average account balance of $15,349 exceeds the $14,932 average balance at year-end 2007 – the beginning of the economic recession.
“Findings from the 2011 year-end 529 Report infographic highlight that, now more than ever, millions of American families see the benefit in investing in a 529 plan, and are continuing to use college savings plans to make their children and grandchildren’s higher education dreams become a reality,” said Fitzgerald. “With more than 107 plans to choose from, most of which offer tax deductions or credits, and with minimum contributions of as little as $15 a month, 529 plans are a convenient way for families of all income levels to save for college. We know that students who have any savings in their name are six times more likely to attend a four-year college than children with no dedicated college savings account. This means that by investing in a 529 plan early-on, our nation’s children will have a better chance at getting a higher education and being competitive in the global job market.”
The year-end 529 Report is based on data aggregated exclusively by CSPN from all 107 Section 529 savings and prepaid tuition programs from Jan. 1, 2011 to Dec. 31, 2011. Data is collected by CSPN twice a year to provide consumers and financial advisors with the most timely, complete and accurate information available on 529 plans. Visit http://www.CollegeSavings.org to view the 529 Report infographic, and for resources and tools that families can use to make informed decisions about saving for college.
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.