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Comparing My529 and Other Top Direct-Sold 529 Plans




Comparing My529 and Other Top Direct-Sold 529 Plans

The "bang for your buck" in a 529 plan generally comes down to low fees, minimal contribution requirements, and high-quality, sensible investment options.

529 Plan (State)Key Fund ManagersTypical Total Expense Ratios (Range)Minimum ContributionKey Advantage for Budgeters
My529 (Utah)Vanguard, DFA, PIMCOVery low (approx. 0.09% - 0.13% for core portfolios)$0 (No minimum)Lowest barriers to entry and excellent diversity of low-cost funds.
Vanguard 529 Plan (Nevada)VanguardLow (approx. 0.14% - 0.16% for age-based portfolios)$1,000 for initial, or $50 for recurring contributionsAccess to the full reputation and brand of Vanguard's low-cost index funds.
New York's 529 Direct PlanVanguardVery low (0.11% for all portfolios)$0 (No minimum)Extremely low, single expense ratio across all portfolios.
ScholarShare 529 (California)TIAA-CREF, Vanguard, DFAExtremely low (0.01% - 0.39%)$0 (No minimum)Some of the absolute lowest fees for passive (index) portfolios.

Note: Total Expense Ratio (TER) is the combination of the administrative fee and the underlying investment fund fee. Fees are subject to change, so always check the official program description.

Where My529 Gets the Most Bang for Your Buck

My529 is considered a top-tier plan for budget-conscious families due to the combination of these factors:

1. The Lowest Barrier to Entry (The "Start Today" Factor)

My529's minimum contribution is the most significant benefit for new or budget-constrained savers.

  • Why it Matters: A family living paycheck-to-paycheck might only be able to commit to a $10 or $25 automatic monthly transfer. My529 allows them to start right away, whereas a plan requiring a $1,000 initial deposit (like Nevada's Vanguard plan) would be completely inaccessible. The ability to save anything is better than saving nothing.

2. Diverse, High-Quality, Low-Cost Investment Options

While other plans rely solely on one fund family (like Vanguard), My529 offers a slightly more diversified selection of institutional-class, low-cost funds:

  • Vanguard: Excellent for broad market indexing.

  • Dimensional Fund Advisors (DFA): Provides access to passively managed, research-driven strategies that are generally only available to institutional investors, but without the high fees of active management.

  • PIMCO Stable Value: Offers a competitive conservative option.

This combination provides flexibility and sophisticated investment choices while maintaining exceptionally low costs.

3. Fee Competitiveness

My529's fees are consistently competitive with the absolute lowest-cost options in the country (like New York and California):

  • The Total Expense Ratio for My529's core options (around 0.113% - 0.124% for Target Enrollment portfolios) is in the same league as the best index options from ScholarShare (California) and New York's 529 Direct Plan. For out-of-state savers, My529 is a clear winner in the fee comparison against higher-cost alternatives.

When a Different Plan Might Be Better

While My529 is excellent, you should always check if your home state's plan offers a key benefit that outweighs the fees of an out-of-state option.

State Tax Deduction/Credit

If your state offers a tax deduction or credit for 529 contributions, choosing your home state's plan might be the biggest financial advantage:

  • Example: If you live in a state like New York or Illinois, the state tax break you get for contributing to your local plan could easily be worth more than the slight fee difference between your local plan and My529.

The Bottom Line: My529 for Out-of-State Savers

For any family living in a state that does not offer a state tax deduction for 529 contributions (like California, Florida, Texas, etc.), or for a family that needs a plan with zero minimums to start saving small amounts:

My529 offers the best "bang for your buck" due to its rare combination of virtually non-existent barriers to entry and institutional-quality, ultra-low-cost investments.

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