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OK, Here's my first post. As a dedicated Fool, I've read the first 2 Motley Fool Books and have taken control of my own personal investing. That said, isn't the whole idea of an a 529 Plan run counter to everything the Motley Fool espouses? I should let an institution invest for me, give a substandard (below market return) and then pay them for it?

For example, if I were to start of with $1,200 and add $100 per month to the account with an Education IRA invested in an index fund (10.5% return), at the end of 18 years, I would end up with $58,574.

Investing in a 529 plan with a 7% return, I could expect $42,697 (by also investing the state tax write off into the fund). This is a difference of nearly $16,000!

At this point, the only benefits I see to a 529 plan are the following:

1) I'm not limited to the $2k/year limit
2) Somehow, 529 plans aren't considered assets of the student going to school and this doesn't count against them for financial aid.

My question now is which one do I invest in? Is $58k of assets enough to be denied financial aid/student loans? By my projections, in 18 years, a state college education will run about $120k, minimum. I kinda think that the laws will change in order to help out more families trying to get their kids an education. 

I've already looked at, but that whole Web-site seems to be biased towards 529 plans. Am I the only one who thinks this is out of whack?

Any input is most appreciated.

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