Hadley Seeks Simpler 529s

Hadley Seeks Simpler 529s

Hadley Investment Co. wants to make it easier for students and parents to find and fund 529 educational savings accounts. The West Hollywood-based company launched last month and was founded when chief executive Yosh Miller wanted to gift money to his niece’s college fund but couldn’t find the best way to do so.

That’s when Miller, who calls himself an “accidental founder,” discovered 529 plans, which are tax-advantaged savings accounts designed for educational cost savings. The company originally had a soft launch in August of last year and previously went through Interplay Ventures’ incubator program.

Hadley, named after Miller’s niece, has an app with a gifting portal with which friends, family or employers can directly fund an individual’s 529 plan to pay for things such as school supplies or even student loans. If an individual doesn’t have a 529 plan, Hadley will help match them with the best plan available depending on factors including state of residency and whether the account is for the user, their child or a future child. Hadley recommends age-based plans, which gradually and automatically shift towards a more conservative investment strategy – with lower risk and lower reward – if the child is older, and uses a more aggressive investment strategy with a potential for higher returns if the child is young and will not use the 529 funds for some time. 

“We need to view student debt as the crisis that it is, and we can lessen that crisis today by opening up 529 accounts and making it easier for not just the parents themselves to fund these accounts, or for the student to fund these accounts, but by building these technology pipes that lift the burden off the shoulders of those parents by allowing social contributions from family and friends,” Miller said.

Miller said that Hadley works with all 529 plans, which are sponsored by states. To set up the company’s operations and its gifting portal, he individually contacted each 529 plan to facilitate electronic contributions. Individuals can use their own state’s 529 plan, but may find lower fees and better investment options in other states, which are factors that can be figured out with Hadley.

The company is a public benefit corporation and registered investment advisor with the Securities and Exchange Commission. Instead of charging advisory fees throughout the life of a 529 plan, Hadley charges a flat processing fee of $1.49 for contributions of $150 or less and a 1% processing fee, which is capped at $20, for contributions over $150. 

“One in two Americans do not pursue their top preferred, or any, post-secondary paths simply and strictly out of cost, and we are already seeing the consequences of that where there’s a shortage of nurses, shortage of electricians and shortage of environmental engineers,” Miller said. “I wanted to democratize access so everyone can have access to their top preferred, most effective, most advantageous savings vehicle.”

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