Filed Under:Life Insurance, Life Planning Strategies

Net flows into 529 plans highest since 2011

The report records net flows (contributions minus withdrawals) during the first quarter of $3.3 billion.
The report records net flows (contributions minus withdrawals) during the first quarter of $3.3 billion.

Total 529 savings plan assets hits $180.3 billion at the close of the first quarter, up from $168.5 billion in the four quarter, according to a new report.

Financial Research Corp., a Boston-based division of Strategic Insights, discloses this finding in a first quarter 2013 report on IRC section 529 college savings plans. The report is based on year-over-year highs in assets under management and investor usage of 529 plans.

The report records net flows (contributions minus withdrawals) during the first quarter of $3.3 billion. This is up from a net flow of $3.1 billion in the fourth quarter and a net outflow of $0.8 billion in the third quarter of 2012.

The first quarter result is the highest recorded by FRC since the first quarter of 2011, when net flows last reached $3.3 billion. The result further indicates that “investors are successful using 529 plans for their intended purpose of savings and spending their savings on qualified higher education expenses,” the report states.

“From an industry asset level perspective, 529 plans continue to reach year-over-year all-time highs,” the report adds. “Therefore investor interest in 529 plans and saving for education in a tax-efficient manner continues to rise.”

The charts below provides data on the Top 10 529 plans by 1Q13 assets.

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