Section 529 of the federal tax code is a provision in the tax code that allows parents and their children to save for college using a tax-free savings plan. While they retain a popular seat on the radio finance circuit, many people have developed a fear of these savings plans due to a rash of unscrupulous broker actions, high “surprise” fees and poor investment options and returns. However, if you do your research correctly, then you can save a bundle (and avoid those pesky student loans) by starting out your college saving early.
Here are three steps to getting started on a successful 529 investing venture:
1. Start at home.
Just as with college tuition rates, college savings rates and programs are generally better at home because you might qualify for a state tax benefit as well as the national tax breaks. Some states even off to match your savings up to a certain amount.

2. Know what you are dealing with.
There are more than 80 529 college savings programs. You need to know them all. It sounds like a lot of work, but when you consider how many thousands of dollars you may pour into this thing, you need to be sure that the option you ultimately select is the right one for you. At the very least, you need to know the fee structure and investment options for each. It will take some time, but you need to know this so that you can make the right decision for you and your money. If you do not, you risk making an investment that will not pay off and that could compromise your college career or that of your children.

3. Talk to financial advisor.
“Talk” is the key word here. Do not hand over the reins to your investment. Most financial advisors do not know all there is to know about 529 investing (or even close) and they will hack off 5 percent of your investment for their own commission. However, it will not hurt to consult a financial advisor (or more than one) before making your investing decision. Not only does this cost less in the long run, but many will do an initial consultation for free if they are hoping to make you one of their clients.