“It changes the time line for educational saving, but allocation will depend on the time line for each client,” says Edelman. “If [assets in an L-3 account] will not be touched for 30 to 40 years, the money would need to be in equities for the vast majority of time. It looks significantly different from the life cycle or target-date funds you see in 529 accounts, where assets shift dramatically from equity to bonds around the time the beneficiary turns 18.”
Few Americans Understand How To Save For Education
May 26, 2017
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This is a good discussion of the challenges and opportunities that we in the 529 community face. But there is an exception to the declaration that states are responsible for originating 529s. That exception is Private College 529 Plan, of which I am president. Private College 529 is a prepaid tuition plan owned by nearly 300 private colleges and universities. (Think Princeton to Stanford and everything in between.) Families buy future tuition that can be used at any member school at today’s prices. The schools guarantee the prepaid tuition no matter how much tuition increases or what happens in the stock market, so account owners are protected from market downturns. Furthermore, families pay no fees. I attend multiple financial advisor conferences every year, and know that many advisors are unaware of this option. But once they hear about how it works, they see a role for it in a college savings portfolio.