Each quarter Savingforcollege.com analyzes the investment performance figures for thousands of 529 portfolios and ranks the 529 savings plans from best to worst for one-year investment performance, three-year investment performance, five-year investment performance and ten-year investment performance.
The top-performing 529 plans
In producing our rankings, we compared the reported investment performance of a subset of portfolios from each 529 savings plan. The ‘performance score’ determines the ranking. For more details, please view our methodology.
Here are our 529 performance rankings as of June 30, 2017.
We ranked plans that consumers can enroll in directly (see below), as well as those sold through brokers and fee-based financial planners).
Top 10 performing 529 college savings plans
How to rank 529 plan performance
Ranking over 3,000 investment options is no easy task, considering the wide variety of options found in 529 savings plans, and it requires a special methodology.
Step one: We select specific portfolios from each 529 plan that can be compared on an apples-to-apples basis to portfolios in other 529 plans, based on their allocation among stocks, bonds and short-term instruments (money market and guaranteed investments). We’ve set up seven different asset-allocation categories ranging from 100 percent equity to 100 percent short-term.
Step two: Within each of the seven categories, we compare historical performance of the selected portfolios and assign each plan a percentile ranking between one (best) and 100 (worst). Separate rankings are developed for one-year, three-year, five-year and ten-year performances.
Step three: We take the average of each 529 plan’s percentile rankings in the seven asset-allocation categories to produce a combined or ‘composite’ percentile ranking. We then produce reports showing how the 529 plans rank against each other in their composite percentile rankings. Note: We currently produce these composite rankings for one-year, three-year, five-year and ten-year performances.
For a more in-depth explanation of our methodology, please read our white paper.
Links to our full report on the composite rankings for this quarter are provided below for the direct-sold 529 plans. Only our Premium subscribers have access to composite rankings for advisor-sold 529 plans, to the underlying data supporting the rankings and to separate one-year, three-year, five-year and ten-year rankings for each of the seven different asset-allocation categories. In addition, subscribers can easily look up the historical performance for every 529 portfolio in every available share class by using our Fee and Performance Lookup Tool.