The research looks at the saving and investing behavior of the owners of 1.9 million 529 plan accounts over the 12-month period ended December 31, 2022. In aggregate, the accounts held $59 billion in assets, of which 53% were in glide-path options and 31% were self-directed. The rest either held a mixture of glide-path and other options or had 100% of their assets in short-term investments.
The self-directed investors in the study sample tended to be more concentrated in equities, potentially leaving them more vulnerable to market volatility around the time the plan beneficiary approaches college age. Glide-path investors, by contrast, shift to an allocation of mostly short-term fixed income and cash as tuition-paying time approaches.
