What Is the Highest Performing 529 Plan?
No single 529 plan stays at the top forever. Performance varies in line with the market, the timeline measured, and the investments chosen, as well as the fees charged. For instance, Saving for College's February 27, 2026 update put the Maryland College Investment Plan in the lead for direct-sold, age-based options — using data through the end of 2025 — presenting a 9.08% average return. The Alaska 529 was right behind at 9.03%.
Meanwhile, Morningstar’s 2025 ratings took distinct factors into consideration and awarded Gold ratings to five programs: Alaska, Illinois, Massachusetts U.Fund, Pennsylvania, and Utah. As ranking methods change, a plan that leads today might not hold that exact spot tomorrow.
Which 529 plans rank highly right now?
| Measure | Current answer |
|---|---|
| Recent performance ranking | Maryland College Investment Plan — 9.08% average return |
| Close runner-up | Alaska 529, 9.03% average return |
| Gold-rated plans from Morningstar | Alaska, Illinois, Massachusetts U.Fund, Pennsylvania, Utah |
| Main reason rankings move | Fees, investment choices, and the specific timeframe measured |
What should Massachusetts families look at first?
For families living in MA, the U.Fund is a strong contender. Fidelity indicates that this program earned Morningstar’s Gold Rating 2 years running. It also presents a state income tax deduction for eligible contributions — up to $1,000 for single taxpayers & $2,000 for married couples filing jointly.
This means the optimal preference for you might not be the one leading a national return chart. An out-of-state option might present a slightly higher past return, but the U.Fund could leave more money in the pocket after factoring in the local tax deduction, the program's quality, and the personal risk tolerance. Performance figures fluctuate, so it is always better to check current numbers — rather than relying on an old ranking.
How do you choose a 529 plan without chasing headlines?
The specific age-based portfolios should be compared — rather than just the overall program name
Look closely at fees before looking at raw returns
Find out if the home state gives you a tax break for using its specific program
Align the investment risk with how soon your child will actually head to college
Review performance across multiple timeframes, like 1, 3, 5, and 10 years.
A big short-term return generally means the portfolio took on more risk. That aggressive stance might suit someone else, but it might not be correct for your situation. When evaluating the options, long-term consistency & the actual makeup of the investments carry heavy weight.
Why Contact Dimov Associates?
Our expert can evaluate the tax impact of the 529 preferences before depositing or withdrawing any funds. We are available to compare the Massachusetts U.Fund against out-of-state alternatives, calculate the value of your local deduction, and verify that the planned withdrawals align with education expenses & current tax rules. Reach out to Dimov Associates today.
