No. 1 - When are 529 plans going to be federalized?

http://www.savingforcollege.com/articles/no-1---when-are-529-plans-going-to-be-federalized

I think it's way too confusing to compare 529 plans when the states all have different rules. When are these things going to be federalized?"" - CS, New York Answer: Don't hold your breath waiting, CS. I agree that shopping for a 529 plan is made more difficult when every state does things their own way. But the states came up with these things in the first place and they have a vested interest in retaining control of them. How would you like it if, for example, you invented a popular software program and the federal government tried to subvert it? (Sorry, Bill.) Besides, the federal government has its own college savings plan. It's called the Coverdell ESA. Not surprisingly, the feds really messed this one up when it first came out in 1997 law as the ""Education IRA"", but now it's much improved. In fact, the ESA is a worthy competitor to the 529 plan for first $2,000 of your child's college savings each year. What concerns me more than the differences between the 529 plans is the degree of uncertainty. The 529 landscape is subject to regular change as new programs are launched, older ones are refurbished, and federal and state laws are revised. What you see now in a particular 529 plan may not be what you see a year from now. For example, let's say you select a certain 529 savings program because you like the program manager, or perhaps the particular mutual funds available in the program. At the end of their multi-year contract, the state could replace the old program manager with a new one, and your account could be shifted from the investment option you were sold on to a different mutual fund or other investment. There will probably be nothing you can do about it, short of rolling over your investment to another state's 529 plan. The complexity and uncertainty is the price you pay for the tax breaks and other benefits of a 529 plan. Many college savers will decide that it is a price worth paying. That includes me.