New York State may have changed the way mutual fund companies compete in the 529 college savings plan market when it replaced TIAA-CREF as the manager of its program with Upromise Investments, Vanguard and FleetBoston's Columbia Management Group late this summer.

Cost was probably an important factor; one person familiar with the bidding said the new team's proposal came in some 20 basis points lower than the 60 basis points TIAA-CREF charged investors. But also important, many said, was the fact that the new management group's advisor-sold platform offered a distinct sales advantage over TIAA-CREF's direct-sold model.

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