While there has been a lot of emphasis on the predictions of billions of dollars flowing into 529 college savings plans, little has been said about the difficulties in operating these plans on a day-to-day basis.

Investment managers are well experienced in administering SEC-regulated mutual funds, but 529 plans are a different and far more complicated matter altogether. Because they are sponsored by individual state treasury departments, each 529 plan is considered a registered municipal security and is governed by the rules of the Municipal Securities Rulemaking Board, not the SEC.

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