The 10 best college savings plans in America that anyone can use
REUTERS/Jessica Rinaldi
In 18 years, the cost to attend a public college is estimated to be about $54,000 a year - over $200,000 for a 4-year degree, according to a recent analysis by investment management company Vanguard. At private colleges, that figure is about $120,000 a year - nearly half a million dollars in total.
Given that enormous expense, it's no wonder many parents worry about how - and when - to start saving for college.
Some families look to 529 plans, an account that allows college savings to grow tax-free, similarly to saving for retirement in an IRA. Some states offer a full or partial tax deduction on 529 contributions as well. When the funds are used to pay for college and other qualified education expenses, withdrawals from a 529 plan are not taxed.
But the offerings in 529 plans vary from state to state, meaning families need to do their due diligence before signing up. Savingforcollege.com (SFC) takes some of the guesswork out of deciding on a plan. The site provides "5-Cap Ratings" - rating each plan from 0 to 5 - in areas such as investment performance, costs (fees and other expenses), and reliability (flexibility to make changes and the quality of financial disclosures from the program).
Still, there are additional things to keep in mind when choosing a 529 plan. If you select an out-of-state plan but live in a state with income tax, you may miss out on a valuable tax deduction. And each plan has a different fee schedule, which should be taken into consideration before making a choice.
Below, take a look at the top 10 college savings plans in America. All scores are out of a possible five points.
- I spent $2,000 for 7 nights in a 179-square-foot room on one of the world's largest cruise ships. Take a look inside my cabin.
- Saudi Arabia wants China to help fund its struggling $500 billion Neom megaproject. Investors may not be too excited.
- Colon cancer rates are rising in young people. If you have two symptoms you should get a colonoscopy, a GI oncologist says.
- 10 Best things to do in India for tourists
- 19,000 school job losers likely to be eligible recruits: Bengal SSC
- Groww receives SEBI approval to launch Nifty non-cyclical consumer index fund
- Retired director of MNC loses ₹25 crore to cyber fraudsters who posed as cops, CBI officers
- Hyundai plans to scale up production capacity, introduce more EVs in India