College Savings Plans

What is a 529 plan?

There are 328,589 reasons for you to start saving for college now. In just 18 years, the cost of a four-year college education at a private college is expected to be $328,589. Public college education costs are also estimated to skyrocket to $110,635. (1) With these kinds of projections, its easy to see the need to begin investing now for tomorrows education. 529 College Savings Plans are a smarter way to save for the student in your life. Take a look at a few of the advantages you'll enjoy:

  • Federal income tax benefits. Investment earnings grow tax-deferred and qualified withdrawals are tax-free for federal income tax purposes. (2,3)
  • Professional investment management. Choose from a wide range of investment options managed through an established investment fund company.
  • High contribution limit. Parents, grandparents, other relatives, and friends may all open separate accounts for the same beneficiary, provided the total contribution does not exceed the combined maximum account limit of $305,000.
  • Full control over account assets. As the account owner, you decide when and how the funds are spent. Control remains entirely in the hands of the owner, not the beneficiary.
  • No income qualifications. Open and contribute to a 529 Plan regardless of your income; the Plan has no minimum or maximum income limits.
  • Affordable. Open an account with as little as $250 per fund and subsequent contributions of just $50.
  • Special gift and estate tax treatment. For each beneficiary, up to $13,000 per year ($26,000 for married couples) may be excludable for federal gift and estate tax purposes or annual contributions up to $65,000 ($130,000 for married couples) can be prorated for gift tax purposes over a five-year period. (3)

Not FDIC Insured • May Lose Value • No Bank Guarantee

  1. Source: U.S. Department of Education, as reported for the 2001-2002 school year. Investing in a 529 plan does not guarantee admission to college nor guarantee sufficient funds to pay for college. The value of an investment in the plan may fluctuate and investors may have a gain or a loss from investment in the plan.
  2. Earnings on nonqualified withdrawals are subject to income taxes and a 10% federal penalty. Per provisions of the Economic Growth and Tax Relief Reconciliation Act of 2001, qualified distributions are federal income tax free.
  3. You should consult your tax and estate advisor before investing. For an offering statement containing more complete information including risks, fees and expense contact your representative at 800-816-0232 (Toll Free).