529 College Savings Plans See Record Growth in the First Half of 2012

If prospective students are looking to save money for college, they may want to learn more about 529 plans.  It seems this year, many people are taking advantage of them.

The College Savings Plans Network (CSPN), the nation’s leading objective source about Section 529 College Savings Plans and Prepaid Tuition Plans, recently released its 2012 mid-year 529 Report which found record-level growth for college savings plans. Based on data collected by CSPN from all 529 plans in the country, including 106 savings and prepaid tuition programs, the mid-year 529 Report shows that for the first half of the year, total assets and total number of open accounts have reached nearly $180 billion and 11 million, respectively.

Highlights of the 529 Mid-Year Report:

• Total investment by American families in 529 plans has reached a record level of $179.02 billion. In the first six months of 2012, total assets in 529 plans grew by $14.16 billion dollars, nearly twice as much as the $7.43 billion increase in all of 2011.

• The total number of 529 accounts continued to increase substantially over the past 18 months, going from 10.16 million in December 2010 to 10.98 million as of June 30, 2012.

• The average 529 account size continues to grow, reaching an all-time high of $16,298 as of June 30, 2012, a 6.2% increase over the past twelve months.

• Including growth from contributions and investment returns, total assets in 529 plans grew by 8.6% since December 31, 2011.

• Saving for a college education continues to be a priority for parents and grandparents as 44% of all 529 accounts received contributions in the first half of 2012.

Hon. Michael L. Fitzgerald, Chair of the College Savings Plans Network and State Treasurer of Iowa

“The U.S. can be more prosperous when our children have better access to higher education. However, its price tag continues to rise and American families are responsible for footing an increasingly large bill,” said Hon. Michael L. Fitzgerald, Chair of the College Savings Plans Network and State Treasurer of Iowa. “With the account size and contributions to 529 plans steadily increasing, we’re seeing a continued commitment by American families to make a long-term investment in higher education. Families recognize that any amount of money saved for college is money they will not have to take out as loans and repay later with interest.”