Only 10% of Americans have ever heard of a 529, according to a survey by Oppenheimer. But a recent feature in Parenting magazine highlighting the investment vehicles might help to change that. In fact, the magazine piece is so praiseworthy and so understandably written that any mutual fund company running a 529 plan might want to run out and pick up the April issue.

529s offer "smart investment choices," are run by "well-known financial services companies," and most importantly, are tax-free in both the accumulation and withdrawal stages, as long as the money is used for tuition, housing or books, Parenting says. In addition, 24 states and the District of Columbia allow investors to deduct all or part of their contributions on their state income taxes.

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