Direct-sold 529 plans are increasingly accessible to advisors as they shift from commission to fee-based compensation, according to a Morningstar study released Wednesday.
“Direct-sold plans recognize that the market is shifting and so they want to provide some of that customization and flexibility that was previously limited to advisor-sold plans,” said Madeline Hume, analyst with Morningstar in Chicago.
The latest 529 College Savings Plan Landscape study found that direct-sold plans accounted for 57% of total 529 plan assets at year-end 2018 compared with 43% for advisor-sold 529 plans, with fees declining at a slower pace for direct-sold plans than advisor-sold plans.
Read more: Direct-Sold 529 Plans Coming to Advisor Market: Morningstar