Illinois has one of the least costly college savings plans

By David Nicklaus

Post-Dispatch, St. Louis, MO

Published Thursday, February 15, 2008

A new fee study by Joseph Hurley’s SavingforCollege.com finds that Illinois’ Bright Start is among the least costly college-savings plans. In fact, among plans that are available nationwide, only Ohio’s CollegeAdvantage  has lower costs than Bright Start. (Louisiana, Utah, Oregon and Kansas have cheaper options that are available only to state residents.)

Hurley has calculated the 10-year cost of a $10,000 investment in each of the plans. He includes annual fees along with the underlying cost of each fund’s investments.  For investors choosing the lowest-cost option in Bright Start, investment expenses will take $359 out of your account over 10 years. For the highest-cost plan in the study, the Montana Pacific Life Funds 529, expenses are a whopping $2,616 over 10 years.

Missouri’s MOST plan is in the middle of the pack, at best. If you choose its lowest-cost option, which relies on Vanguard index funds, fees will set you back $774 on a 10-year, $10,000 investment. In MOST’s actively managed options, the fees can rise as high as $1,802, which is the sixth-highest figure for any plan.

The study compared only plans that are sold directly to investors, not the versions sold through brokers. The broker-sold plans usually have higher costs.

  
     
 
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