Despite news that many Americans still aren’t aware of 529 college savings plans, the number of accounts opened and the average size of accounts have increased, according to the College Savings Plans Network (CSPN).
CSPN, an affiliate of the National Association of State Treasurers based in Kentucky, is a national non-profit association that monitors state-administered 529 plans and provides information on them.
During 2017, 529 assets grew by $44 billion, or 16 percent, to $319 billion, a new record. The number of accounts rose by 3 percent, to 13.3 million, up from 12.9 million at the end of 2016, CSPN said. The average account size rose to an all-time high of $24,057, from about $20,000 in the years from 2013 through 2016.
This small victory for the 529 sector demonstrates to CSPN that more Americans are prioritizing college savings in their family financial planning, said James DiUlio, CSPN’s chair. Efforts by state-run 529s to increase awareness of the college savings vehicle may be working. State-run plans like the Wisconsin College Savings Program boasted of how its plan has assets that reached $5 billion.
State departments and banks have been creative in getting people to embrace 529 plans; some have helped fund starter accounts with competitions like diaper derbies or 529 gift cards. Some organizations have found ways to link 529 accounts to an employer’s benefits package. Widespread media coverage on 529 plans during the tax overhaul debate in 2017 also helped to raise their visibility.