Backer offers the most features with the best pricing.
As the first and only robo-advisor focused exclusively on education savings, we offer the most comprehensive college savings platform.
Here's how we compare:
| Feature |
Backer |
Brokers & traditional advisors |
Account Fees |
Free with a $1.99 contribution fee, or $2.99/month with Backer Pro ($29/year) | Upfront commission or initial sales charge (~5%) + annual asset-based fee (~1%) |
Investment Expenses |
0.14% - 0.15% annually | 0.89% per year on average for advisor-sold plans |
Hidden Fees |
None | Enrollment or other one-time fees |
Gifting Platform |
$1.99 per gift or free for Backer Pro members | Limited with service fees or not offered |
Why Backer is the Smarter Choice:
- Affordable and Transparent: You won’t find any hidden fees or surprise charges with Backer. We offer a free account with a $1.99 contribution fee, or you can upgrade to Backer Pro for $2.99/month or $29/year, which includes additional features and benefits.
- No Asset-Based Fees: With Backer, you won't pay more just because you're saving more. Instead of asset-based fees, we charge a predictable monthly or annual fee, ensuring the more you save, the more you keep.
- No Commissions or Sales Charges: Unlike traditional brokers or financial advisors, we don’t charge any upfront commissions or initial sales fees.
- Low Investment Expenses: Our recommended 529 plan comes with an investment expense of just 0.14% - 0.15% per year, much lower than typical advisor-sold plans.
- Gift Contributions Made Easy: Send gifts with ease for just $1.99 per gift or enjoy this feature for free with a Backer Pro subscription.
At Backer, we’re on a mission to make college savings simple, transparent, and affordable for every American family.
529 Plan Fees
Please note that our monthly fee is separate and apart from any distribution or transaction fees charged by the 529 plan or its affiliates. Information about these other fees is disclosed in the 529 plan disclosure documents, which are provided to you upon enrollment. We do not collect those fees and we do not receive revenue from any 529 plan or its affiliates, nor from any funds that make up the 529 plan portfolio, nor from any fund manager.
529 plan fees can vary widely. State-sold 529 plans charge on average around 0.60% per year, while advisor-sold 529 plans charge on average around 0.89% per year. Backer makes sure to only recommend a 529 plan and associated portfolio with low fees. As of 2020, the average fund fees for the 529 plan and portfolios recommended by Backer ranged from 0.14% – 0.15% per year, or approximately $16 to $18 per year on a $10,000 investment.
Below is a chart that compares the average 529 plan fees with the investment option that Backer recommends:
529 Plan |
Average fees charged |
Average fees charged on hypothetical $10,000 investment |
|
Direct-sold 529 plan |
0.60% per year |
$60 per year |
|
Advisor-sold 529 plan |
0.89% per year |
$89 per year |
|
Backer-recommended 529 plan |
0.14% - 0.15% per year |
$14 - $15 per year |
We believe it is important to recommend a 529 plan with low fees because it will help you save more in the long term. You will pay fees and costs whether you make or lose money on your investments. Fees and costs will reduce any amount of money you make on your investments over time.
How much more will I save?
Compared to a broker, you could save $37,000 over the life of your account.** This hypothetical pricing comparison calculation is for informational purposes only and is based on the following assumptions. You start a college fund for your child with an initial investment of $5,000 in a 529 plan and contribute $250 every month to the fund over 18 years. You start a second college fund when your second child turns 4 years old with the same initial investment and recurring contributions. Your investment has an annual return of 8%. You pay us a monthly advisory fee with no upfront commissions or initial sales charges, and your 529 plan has an underlying expense fee of 0.17% per year. This is compared to a hypothetical financial advisor who charges you a 5% upfront commission or initial sales charge and an annual asset-based fee of 1% for your 529 plan investment, and a hypothetical 529 plan that has an underlying expense fee of 0.89% per year (which was the industry average for advisor-sold 529 plans as of 2020). This does not include additional fees that the hypothetical advisor or 529 plan may charge, such as fees for rollovers or withdrawals, which are free with Backer. The actual costs of working with a financial advisor may be different from these assumptions and your account may perform differently due to changes in recurring investments, time horizon, or returns.