529 plans

The difference costs can make

Don't ignore the price of investing. High costs can make a huge impact on how much you have left to pay for education.


Open a Vanguard 529 account

Open a Vanguard 529 account

What you're paying for

Investment costs, which pay for the management of the plan and its investments, are measured in small percentages known as expense ratios. Even a seemingly small expense ratio can make a big dent in your savings.

Let's say you have $10,000 to invest in your newborn's education fund and you're choosing between two 529 plans. In the first plan, the investment you're interested in has an expense ratio of 0.53%, which is the industry average.* A similar investment in The Vanguard 529 Plan has an expense ratio of 0.14%.

Such a small difference couldn't matter that much in the long run, right?

Well, in year one, you'd pay $53 for your investment in the first plan, versus $14 in The Vanguard Plan. So your balance at the end of the year would be $39 higher in The Vanguard Plan, all else being equal.

But wait—that's not the end of it. The $39 that you didn't pay in expenses to Vanguard will keep earning returns over the next 17 years. In fact, by the time you're ready to use your education savings, that $39 could actually be worth $105.

And remember, this scenario will keep playing out every year that you have money in your account. Put it altogether, and that 0.53% expense ratio could knock $2,463 off your final balance. That number drops to $671 with The Vanguard Plan. That's an additional $1,792 your child can use for education.

The moral of the story is: Don't let costs erode your savings.

You could keep more money for education by choosing Vanguard

This hypothetical illustration assumes an average annual 6% return over 18 years and does not represent any particular investment nor does it account for inflation. "What you lose to costs" represents both the amount paid in expenses as well as the "opportunity costs"—the amount you lose because the costs you paid are no longer invested. There may be other material differences between investment products that must be considered prior to investing. Numbers are rounded. The rate of return is not guaranteed.

The Vanguard 529 cost advantage

Our costs are among the lowest in the industry. Since our plan was introduced in 2002, we've cut our expenses 10 times. Because we stay focused on reducing your investment costs, more of your money can stay in your account—working toward your goals.

Fees you won't pay at Vanguard:

  • Enrollment fees.
  • Transfer fees.
  • Commissions.

Want to roll over money you have in another 529 plan?

  • Learn how to move money to The Vanguard 529 Plan

    Learn more
  • Use our college savings planner to see if you'll have enough for college

    Learn more

Open a Vanguard 529 account

Open a Vanguard 529 account

The Vanguard 529 College Savings Plan is a Nevada Trust administered by the office of the Nevada State Treasurer.

*Average annual asset-based fees for asset allocation portfolios across all 529 plans. Source: ISS Market Intelligence, December 2021

For more information about The Vanguard 529 College Savings Plan, visit vanguard.com to obtain a Program Description, which includes investment objectives, risks, charges, expenses, and other information; read and consider it carefully before investing. Vanguard Marketing Corporation, Distributor.

If you are not a Nevada taxpayer, consider before investing whether your or the designated beneficiary's home state offers any state tax or other benefits that are only available for investments in such state's qualified tuition program. Other state benefits may include financial aid, scholarship funds, and protection from creditors.

The Vanguard Group, Inc., serves as the Investment Manager for The Vanguard 529 College Savings Plan and through its affiliate, Vanguard Marketing Corporation, markets and distributes the Plan. Ascensus Broker Dealer Services, LLC, serves as Program Manager and has overall responsibility for the day-to-day operations. The Plan's portfolios, although they invest in Vanguard mutual funds, are not mutual funds. Investment returns are not guaranteed and you could lose money by investing in the Plan.

All investing is subject to risk, including the possible loss of the money you invest.