Three steps to a $1 million college fund

Three steps to a $1 million college fund
Three steps to a $1 million college fund

Beyond the tax benefits, investors should know about the two types of 529 college savings plans: those sold directly by the states and those sold through financial advisors. (To make matters more confusing, there are also 529 prepaid plans that allow account holders to buy tomorrow's tuition at today's prices at in-state public colleges and certain private schools.)

Direct-sold 529 plans generally have lower investment fees than advisor-sold ones. However, advisor-sold plans tend to offer more investment options.

Parents of multiples or several children may have to consider investing aggressively to meet their college savings goals, said David Frisch, a CFP and president of Frisch Financial Group in Melville, New York.

Frisch, the father of 14-year-old triplets, has 529 plans for each of his children, and he uses the same investment strategy for all of them.

"If any one of them had one more cent than the other, there would be hell to pay," Frisch said. "My biggest fear now is potentially having all three graduate on the same day in three different places."


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