Despite rising college tuitions and ballooning student debt, only 36% of Americans can correctly identify a 529 plan as an education savings tool, according to a recent study conducted for Edward Jones — a one percentage point decline from 2012, when the firm did its first annual study of the plans.
The recent study also found that only 20% of parents report having saved or planning to save for their children's education using a 529 plan.
In lieu of saving for education with 529 plans, American parents have saved or are planning to save for education costs with a mix of personal savings strategies and financial aid options, with 40% utilizing a personal savings account, 23% relying on scholarships, and 22% employing federal or state financial aid in their education savings strategies, the company said in a release.
Barriers that respondents cited as keeping them from contributing to 529 plans included paying off their own student loans (15%), the fear of being penalized on unused funds if a child doesn’t go to college (14%), and the feeling that they don’t make enough money to open a 529 account (12%).
“With 67% of Americans admitting that they were not aware of the features and potential tax benefits of 529 plans and 65% unaware of their possible uses beyond higher education, there is an opportunity to fill the education gap with the help of a trusted financial adviser,” the firm said.
“Semiliquid funds are making private markets more accessible but are much pricier than public market funds,” according Morningstar.
Despite record plan participation, many workers remain at risk of inadequate retirement savings as Social Security’s future grows more uncertain.
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The recently rebranded Focus Partners Wealth is growing again, this time with a pending deal for a Fairfax, Virginia advisory firm.
The transaction significantly expands the firm's reach and capabilities.
Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.
Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.
