While many executives in the fund industry quietly consider 529 plans to have been a disaster for most of those jumping into that business, 2003 may have held a surprise. A number of plans added a significant amount of assets during the year, reports USA Today.

Assets in the California program run by TIAA-CREF jumped 28 percent to $946 million, for example. Virginia, a state that runs both a direct-sold and an advisor-sold program, also reports an increase.

Total assets in the advisor-sold CollegeAmerica program jumped 165 percent to $5.3 billion, Diana Cantor, executive director, told the paper. Both the assets and growth in that plan outpace those in the direct-sold Education Savings Trust, which saw its asset base climb 71 percent to $358 million

Meanwhile, Michele Carlisle, chief financial officer of the Ohio Tuition Trust Authority, told the paper that its assets rose 42 percent to $3.7 billion. The growth in that plan came despite the administrator -- Putnam Investments -- being caught up in the recent fund scandals.

Still, 529 plans are not out of the woods yet. Tonight President Bush is expected to revive his LSA and RSA savings accounts. That could pose a problem for the product in 2004 and 2005 if the accounts are adopted and prove to be more alluring to investors than 529s. The good news is that few reforms proposed in State of the Unions ever make it out of Washington.  

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