Assets in 529 college savings plans rose 38% in the first quarter from a year ago, the College Savings Foundation announced. Assets topped $75.1 billion in the quarter, compared to $54.5 billion in the first quarter of 2005.
Net sales during the period were $5.1 billion, the largest total on record.
"This dramatic escalation in college savings plan assets illustrates the buoyant demand on the part of American families for tax-advantaged college savings vehicles," said David Pearlman, president of College Savings Foundation.
"Competition among plan providers for expiring contracts with the states is greater than ever," said Brian Boswell, a research analyst with Financial Research Corp. "In many cases, 529s are providing a broader investment selection and lower fees, making the programs more attractive."