“FINRA, a private self-regulatory organization for the financial industry, has been cracking down on brokers for selling funds with excessive fees to those saving in 529 accounts, which can cost investors thousands of dollars over the long term.” (CNBC, December 2020).
The SEC highly recommends that investors review the 529 Plan’s offering circular to understand fees. Other important information from the SEC:
What is a 529 Plan?
“A 529 plan is a tax-advantaged savings plan designed to encourage saving for future education costs. 529 plans, legally known as “qualified tuition plans,” are sponsored by states, state agencies, or educational institutions and are authorized by Section 529 of the Internal Revenue Code.”
529 Plans Rules
“Fees and expenses will vary based on the type of 529 plan (education savings plan or prepaid tuition plan), whether it is a broker- or direct-sold plan, the plan itself and the underlying investments.”
529 Plans and Taxes
“Investing in a 529 plan may offer savers special tax benefits. These benefits vary depending on the state and the 529 plan.”
Peiffer Wolf Carr Kane & Conway is investigating Excessive Fees related to Fidelity’s 529 Plan. If you have invested in Fidelity’s 529 Plan, please Contact Us for a FREE consultation by filling out a Contact Form or by calling 504-523-2434.