Author Topic: 529 - PA or Vanguard  (Read 1791 times)


  • 5 O'Clock Shadow
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529 - PA or Vanguard
« on: October 28, 2015, 07:35:55 PM »
I'm planning to set up a 529 plan for my 1.5 year old daughter, and was looking for insight on if I should set it up through Vanguard or PA529 (the state run plan, I'm a PA resident).
Both have the tax deductions, but it appears there are some addiitonal benefits to opening the plan through PA529.

As a Pennsylvania resident, you get special treatment. Not only are your contributions deductible from your Pennsylvania state income tax, the entire value of your account is exempt from Pennsylvania inheritance tax.* Assets held in a PA 529 plan are not counted when determining state financial aid for college. Assets in any other state 529 plan are counted. PA 529 assets are also protected from creditors in Pennsylvania. Assets in out-of-state plans are not protected.

The PA plan has expenses about 0.2% higher than Vanguard. I'm wondering if the account being excluded from state aid figures would negate that? Or would the Vanguard plan also qualify for that?
Vanguard comparison of the two.

Also, I'm wondering if anyone has insight on what investment option to choose. 100% stocks seems aggressive for a 16 year time-frame, I'm thinking 75/25 stock/bond would be a good option.