Thanks to the Pension Protection Act of 2007, more than 25% of financial advisors who do not yet sell 529 college savings plans expect to do so soon, according to a new study.

The researchers who conducted the study, which was commissioned by MFS Investment Management, Boston, found that 33% of advisors currently selling 529 plans expect to increase their 529 plan sales volume, according to MFS.

The MFS 529 Savings Plan is sponsored by the state of Oregon.

There is still plenty of room for growth for the plans: Fewer than 13% of 73.5 million children under the age of 18 in the U.S. have 529 accounts opened in their names.

The PPA permanently extended the tax benefits of state-sponsored 529 plans, allowing funds to grow tax-deferred in these plans and then to be withdrawn tax-free, if used to pay for qualified education expenses.

Regional broker-dealers indicated they have a growing interest in 529s. With an older client base, these brokers also forecast greater 529 sales to grandparents hoping to create an education bequest for their families, MFS reports.

MFS says 80% of financial advisors have sold some form of college savings investment product to clients, with 66% saying 529 plans were their investment vehicle of choice.

Accounts set up under the Uniform Gifts to Minors Act or the Uniform Transfers To Minors Act represented the next most popular product line, with 20% of sales.

Most sales of college savings vehicles are made by independent advisors, who report such sales represent almost 25% of their books of business. Conversely, broker-dealers currently have only 5% of their business in college savings vehicles, MFS found.

Nearly twice as many active 529 plan sellers as nonsellers are aware of the details of the PPA as they affect 529s, the study found.

Advisors cited compliance issues as the top obstacle to successfully selling 529s. They mostly agreed that the best way to sell more products is by improving training of financial advisors and by educating consumers as well.