If you are planning to start saving for college, then you may be considering using a 529 investing plan. These plans are great because they often come with tax benefits and they may also offer sign up bonuses. In addition, they often garner more interest than traditional savings accounts and may even enable you to deduct a monthly amount from your paycheck before you pay taxes on your earnings.

However, one of the drawbacks of a 529 investing plan is that there are probably a pretty limited number of investing options. At best, you will likely only have about a dozen or so investing portfolios at your disposals, including some static portfolios that are either 100 percent stock or 100 percent bond funds. Of course, you will also have the option of some age-based portfolios that mix stock and bond investing that tend to get more conservative the closer college looms. In addition, you may have some mutual fund options. This is generally the case with mutual fund families like Vanguard, Fidelity Investments and TIAA CREF.

While this may sound like a lot right now, in reality these represent only about four investing options. You need to be sure that you are investing in a plan that will meet your investing needs and will earn as much money as possible over the life of the investment. This will depend largely on when you open the account. If you only have a few years until college, you need to invest very conservatively so that you:

• Earn as much money as possible
• Do not deplete your funds paying fees
• Do not “gamble” on your college education

This means that you should look for programs that offer “no-tax” options as long as funds are used for college and that you should look for programs with guaranteed returns if possible.

On the other hand, if you are a parent saving for a child’s education and you have many years ahead to save, you might want to try some stock-based options or options that enable you to invest more at a higher interest rate but may have a few more fees involved. These are called “active” funds and often are managed by an account manager rather than allowed to sit and garner interest. Of course, you should always make sure that you have fully funded your retirement before you start a college plan.