Harris Insight Arranges College Credits
October 2, 2000
Harris Insight of Chicago has come up with a method of easing parents' anxieties about saving enough money to send their children to college. Harris' College In-Sight program, which has been actively promoted since March, encourages investors to save by offering college tuition reduction rewards based on their mutual fund account balances.
College In-Sight is similar to a frequent flyer program. Rather than free flights, however, investors are awarded tuition reductions amounting to approximately five percent of their fund assets on an annual basis. The maximum reward is one year's tuition or $13,800, whichever is less. The tuition reward is usually spread evenly over the four years of undergraduate education.
"This is a very attractive deal for a family whose income is too high to receive scholarships," said Bernie Whalen, Harris Insight's senior vice president for the investment products group.
The College In-Sight program is administered by SAGE Scholars, an educational consulting firm in Philadelphia. The program was originally developed by SAGE's founder, James B. Johnston, a former dean of the Wharton Business School at the University of Pennsylvania in Philadelphia.
Currently, 131 colleges and universities have signed up to participate in the program. Among participating institutions are
Clark University in Worcester, Mass., DePaul University in Chicago and St. Lawrence University in Canton, N.Y.
Investors must pay an annual membership fee of $35 per student to join SAGE. At present, Harris Insight is the only mutual fund company that is participating in the SAGE program.
College In-Sight is attractive to colleges and universities because it provides them early access to families who are committed to saving for college, said Whalen.
"Colleges want parents and families to start saving and planning for college sooner and this program helps them to do that," said Whalen.
In addition to receiving quarterly account statements and a record of the tuition reductions they have earned, College In-Sight investors hear from numerous participating colleges and universities.
"After the first year of high school, colleges and universities will mail promotional materials to the students to try to get them interested in their schools," said Whalen. "In addition, from time to time, the parents will receive material about college planning from SAGE Scholars."
Harris' marketing programs are directed at brokerage firms and registered investment advisors, but the fund company may get some help promoting College In-Sight from the colleges and universities themselves.
"It's up to the individual colleges and universities whether they pitch our program," said Whalen. "Some do more than others. A few schools have run articles in their alumni magazines."
Whalen said the arrangement has been well received by investors.
"This program gives investors another reason to look at our funds and we have hundreds on board," he said.
A key selling point of College In-Sight is that investors maintain ownership of investment assets, Whalen said.
"The tuition reductions are not deducted from Harris Insight fund assets, so those assets can continue to grow over time to meet other financial needs," said Whalen. "Parents or grandparents can invest for retirement as they normally would and receive the additional benefit of college discounts. If investors have a financial problem and need the money, they have access to the money without any penalty. This gives investors some flexibility and added control over their investment dollars. This program enables people to meet their own investment objectives and help send loved ones to school."