The college year now in full swing, Morningstar Inc. has released its ratings of top Section 529 savings plans based on expected risk-adjusted performance into the future. With total assets in the savings vehicles reaching $214 billion as of Sept. 30, up 18% from last year, advisers are taking note.
Out of 64 plans studied (which hold about 95% of all assets in 529s), eight reached the top two echelons: four golds (“best in breed”) and four silvers (“notable advantages”). Three plans got a negative rating because Morningstar sees “at least one major flaw” in them that could seriously damage long-term returns. [In alpha order by rating. Ratings not included here were bronze and neutral.]