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Fund Spy

Costs Weigh on the Nation’s Largest 529 Plan

Virginia’s CollegeAmerica earns praise for its investment team and underlying processes, so why does it net a just Bronze rating?

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At $91 billion in assets, Virginia’s CollegeAmerica 529 plan accounts for nearly one fifth of the entire 529 industry and is more than twice the size of the second-largest plan. It is sold nationwide entirely through financial advisors; this wide remit, plus Capital Group’s vast distribution capabilities, allows CollegeAmerica to reach more investors than 529 plans sold directly to savers, which tend to be held primarily by in-state residents.

Tom Nations does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.