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529 College Savings Plans

News

Automatic IRAs a Good Start, But Need Improvement: Aite Group

Government’s effort to boost retirement savings could overburden small employers.

Plan to Lock in Tuition Rates at 275 Colleges

The Tuition Plan Consortium said Monday it re-launched Independent 529 Plan as Private College 529 Plan, to foster pre-purchasing of tuition fees as present rates. The consortium said its Private College 529 Plan will offer investors a way to lock in tuition rates at more than 275 private colleges and universities.

Americans Saving for Retirement, Not College

Despite rising tuition fees, the uncertain state of the economy is causing more people to put their own retirement savings ahead of their children’s college education and future.

T. Rowe Price Lowers 529 Fees, Elbows Competition

Education Trust of Alaska is the beneficiary of the latest move in ongoing price competition among 529 college savings plans. Between Nov. 1 and Dec. 1, plan managers lowered total 529 fees to 1.17% from 1.19% on adviser-sold plans and to 0.69% from 0.71% on direct-sold plans, according to FRC.

High School Seniors Worried About College Costs: Fidelity

Survey finds 70% of seniors feel overwhelmed about high cost of attending college.

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Articles

College-Savings Firms Adopt Cash-Back Loyalty Programs

Two college-savings companies are borrowing a page from the consumer cash-back loyalty playbook, offering customers rebates on services including refinancing mortgages or opening online bank accounts. Futuretrust, a unit of Destination Maternity Corp., and Upromise Investments have partnered with a series of other financial services companies to offer rebates that can be swept into section 529 college-savings plans. Futuretrust has teamed up with Citigroup and Wells Fargo's Wachovia Bank to introduce a program where customers get 25 basis points of the amount that they refinance or originate in a mortgage deposited in a 529 plan, said Adam Bashe, a managing director at the company. It also has partnered with Waterfield Bank, an Irvine, Calif., online banking company, to deposit 1% annually of a customer's average daily balance in a 529 plan.

Treasury Recommends 529 Savings Plan Fixes

The Treasury Department has proposed several improvements for Section 529 college savings plans, including the use of age-based index funds and the elimination of home-state biases. The report, prepared for the White House Task Force on Middle-Class Working Families, was introduced at a meeting of the White House task force, chaired by Vice President Joe Biden, at Syracuse University in New York, where attendees discussed ways to help families save and pay for college.

College Savings Plan Gets Smarter

Friends and family members of New York college-bound students can now make contributions to a student's 529 college savings plan, thanks to a change in New York State law that mirrors similar programs in other states. With $8.3 billion in assets, New York's 529 plan has bragging rights to having the largest direct-sold channel with $7.1 billion across 500,000 accounts as of May 2008. Its companion advisor-sold plan channel has additional assets of $1.2 billion and 100,000 accounts. With combined assets, New York is overall the fourth largest college savings plan in the nation.

Hartford Courts College Plans in Other States

After a year of record growth, Hartford Financial Services wants to expand its 529 college savings business over the next two years by increasing sales and, perhaps, in what would be a shift in strategy, by becoming a plan sponsor in another state. Last year, the Simsbury, Conn., company increased its 529 college savings plan sales a record 29.5%, to $250 million, and its 529 plan assets under management 21%, to $1.1 billion. Now it says it will start examining requests for proposals to determine if it wants to become a provider for states other than West Virginia, whose plan it has sponsored since 2002.

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