A couple of basic 529 tips:
- Invest more conservatively as the college years approach. In 2008 the average 529 lost 28%, reflecting the stock market's plunge that year (compared to -37% for the S&P 500). A strong argument can be made to shift 529 assets to cash completely in the two to four years before college.
- Shop carefully for low fees and competitive performance. Average 529 fees and performance tend to be less attractive than their retail mutual fund counterparts.