Savings Incentives and Prices: A Study of the 529 College Savings Plan Market
Posted: 17 Mar 2009
Date Written: March 16, 2009
Despite the fact that 529 College Savings Plans have existed for over a decade, there has been limited scholarly attention on investment questions related to this savings vehicle. I analyze the market for 529 plans using a plan level panel data set of 529 College Savings Plan information covering the years 2002 - 2006. I find evidence of limited market competition and a positive relationship between state tax rates and 529 plan fees. A $100 increase in potential wage benefit from investing in a 529 plan is associated with a 3-5 basis point increase in fees for direct sold 529 College Savings Plans.
Keywords: 529 Plans, Fee Structure, Savings Incentives
JEL Classification: G10, G11, H24, I22
Suggested Citation: Suggested Citation