College savings plans are benefiting from the outflow of $1 trillion in money market funds since 2008, according to a new report by Financial Research Corp. in Boston. Net flows into the plans have risen by 75 percent in the past two years, and 529 college savings assets will grow to $237 billion by the end of 2015, FRC predicts.
And don't expect all that money to benefit teenagers. The research group sees a "substantial opportunity" for mid-career professionals to set up 529s. Firms are cutting their tuition reimbursement programs, FRC notes, and many employees expect they'll have to polish their skills to ensure a place in the work force.
FRC says 529s are being marketed more heavily now. New account openings are up by 15 percent, it reports in its new study, "529 Plans and Distribution Analysis."