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References
Investment Returns and Methodology
  • Long-run stock market returns. The approximately 11% long-run figure for U.S. stocks refers to the total return of the S&P 500. Source: Robert J. Shiller, “U.S. Stock Markets 1871–Present,” Yale University Department of Economics (data as of June 2026). (Link) [R-SP500]
  • Kiddos Capital Plan Generator — Outcome Projection Methodology:  The figures in a Kiddos plan are illustrative estimates, not predictions. To test whether a plan is likely to reach its goal, we simulate 10,000 possible market histories built from actual S&P 500 total returns since 1970, and run each family’s own contributions, loan, and fees through every one. A plan’s contribution is set so that it reaches the goal even in lower-outcome scenarios — by design, in roughly 9 of 10 of these simulated histories. Any “simulated return” shown is simply the steady annual rate that would produce that result for that specific plan; it is not a forecast of market returns. Past performance does not guarantee future results. For more on our methodology, please contact us. [R-Meth]
  • Tax-loss harvesting. Estimates of the added annual return from systematic tax-loss harvesting draw on Liberman, Sialm, Sosner, et al., “The Tax Benefits of Separating Alpha from Beta” (2019), which found net annual benefit in the range of roughly 0.85%–1.10%. (Link)  [R-TLH]
  • Active funds vs. the index. The finding that the large majority of actively managed funds underperform the index over long periods comes from S&P Dow Jones Indices, SPIVA U.S. Scorecard, Year-End 2024: 89.5% of actively managed U.S. large-cap funds trailed the S&P 500 over 15 years. (Link) [R-SPIVA]
529 Plans
  • Historic 529 Performance. To substantiate the 529 returns cited on this site, Kiddos Capital reviewed published since-inception performance for index-based target-enrollment (target-date) portfolios that have completed, or nearly completed, the full ~18-year glide path. Among low-cost, index-based plans — the most common choice — completed-cycle portfolios have returned roughly 4.7% to 5.0% per year since inception, net of fees. Representative figures:
    • New Hampshire UNIQUE Plan — NH Portfolio 2024 (Fidelity), inception 12/27/2004: 5.04% since inception (as of 03/31/2025). (Link)
    • Virginia Invest529 — Target Enrollment 2024: 4.69% since inception (as of 09/30/2026). (Link)

These portfolios hold a child’s savings from near birth to near college enrollment. By the enrollment window they have shifted largely into bonds and cash (the NH 2024 portfolio held roughly 85% bonds and short-term reserves and about 15% stocks), which is why their long-run return is well below the stock market’s historical average. Actively managed 529 plans have returned more over the same period, at higher cost and risk. Figures are historical and net of fund expenses; past performance does not guarantee future results.  [R-529RET]

  • Average 529 balance at enrollment. The average 529 balance was about $34,000 ($34,084 as of December 31, 2025). Source: Saving for College, “Average 529 Plan Balance: How Do You Compare?” (Link) [R-529BAL] 
  • How 529 savers invest. Nearly 7 in 10 529 accounts use an age-based (glide-path) investment track. Source: Vanguard, “Saving and investing in 529 plans” (July 2023), based on 1.9 million accounts. (Link) [R-VANG]
  • How a 529 glide path shifts over time. A 529 target-date portfolio typically starts heavily in stocks and moves toward conservative holdings as college approaches, ending near 10%–20% in stocks at enrollment. Representative allocations are published in each plan’s program description (for example, the Virginia Invest529 and Fidelity plans cited above).  [R-GLIDE]
Cost of College
  • Net price of college by family income. Figures for what families actually pay after grants and scholarships are drawn from the U.S. Department of Education’s IPEDS database (National Center for Education Statistics). For families with income above $110,000, the average net price at a public four-year university is about $85,000 over four years, and about $163,000 at a private nonprofit four-year university. (Link) [R-IPEDS]
  • Tuition has been flat; living costs have risen. Inflation-adjusted tuition at public universities has been roughly flat since 2010, while room and board has grown faster than inflation. Sources: College Board, “Trends in College Pricing and Student Aid” (2024 and 2025) (Link); and Federal Reserve Bank of Richmond, “Tracking College Tuition Growth” (July 2024) (Link). [R-CB]
  • Living expenses as a share of college cost. Reporting on the rising share of college cost tied to housing and food is drawn from The Hechinger Report (August 2024) (Link) and the Urban Institute, “Five Facts about the Sharp Rise in College Living Costs”.  (Link) [R-RB]
  • Long-run tuition inflation. Historical tuition-inflation figures draw on EducationData.org, “College Tuition Inflation Rate,” which compiles NCES/IPEDS and Bureau of Labor Statistics data. (Link) [R-EDDATA]
Student loans, debt and market-timing risk
  • Average student loan debt. Figures for average student borrowing are drawn from EducationData.org, “Average Student Loan Debt.” (Link) [R-SLDEBT]
  • Parent borrowing. Many families also borrow through federal Parent PLUS loans. The average Parent PLUS balance is about $25,600. Source: Adam Looney and Vivien Lee, “Parents are borrowing more and more to send their kids to college—and many are struggling to repay,” Brookings Institution (November 2018). (Link) [R-PLUS]
  • Why selling in a downturn matters. A family paying tuition from an investment account has to sell on the college’s schedule, not the market’s. We reviewed the last 30 years of S&P 500 history against the twice-a-year windows when tuition bills typically come due. In 10 of the last 60 of those payment windows, there was no day on which a family could have sold without taking a loss of 15% or more from the market’s recent high — and those windows clustered into two multi-year stretches (2001–2003 and 2008–2010). The point isn’t that markets don’t recover; they do. It’s that dollars sold at the bottom to pay a bill never participate in the recovery. (Based on S&P 500 price-index history, 1992–2025. Past performance does not guarantee future results. For the full analysis, please contact us.) [R-DOWN]
Tax Rules
  • 529-to-Roth IRA rollover. The ability to roll unused 529 funds into a Roth IRA (up to a $35,000 lifetime limit, after a 15-year account-seasoning period, effective 2024) was established by the SECURE 2.0 Act of 2022, §126. (Link) A plain-language summary is available from the IRS. (Link) [R-Secure]
  • Penalty on non-qualified withdrawals. Withdrawals from a 529 not used for qualified education expenses are subject to income tax plus a 10% penalty on the earnings portion. Source: IRS Publication 970, “Tax Benefits for Education.” (Link) [R-PUB970]
Firm and Regulatory
  • Firm registration. Kiddos Capital LLC is an investment adviser registered in the State of Illinois. Our registration and Form ADV are available through the SEC’s Investment Adviser Public Disclosure site. (firm brochure) [R-ADV2A]
  • Fees. Our fees are disclosed in our Form ADV, Part 2A. (firm brochure) [R-ADV1] 

  • Custody. Client securities are held at Altruist Financial LLC, a member of SIPC. (Link) [R-SIPC]