The Minnesota 529 College Savings Plan (MNSAVES) Announces Lower Fees and Enhanced Investment Options
NEW: MNSAVES named a Best in Class 529 Plan by Morningstar*!
ST. PAUL, Minn., Oct. 28, 2019 /PRNewswire/ -- For nearly two decades, MNSAVES has sought to make higher education more accessible to families across Minnesota. MNSAVES is excited to announce that current and future account owners will see more of their hard-earned money invested toward their college savings goals with average Plan fees dropping to 0.15 percent, more than three times lower than the 0.61 percent national average fee for all 529 plans**. The fee reduction of over 30 percent could save MNSAVES account owners a combined total of approximately $1.2 million annually.
As we continuously look for ways to improve MNSAVES, we are bringing industry best practices to the education savers of Minnesota by introducing an Enrollment Year Investment Option. The Plan's Age-Based glide path structure, commonly offered in most 529 plans, will be replaced with an Enrollment Year structure establishing investment portfolios tied to a beneficiary's expected enrollment date of use. This structure is more progressive with more frequent investment reallocations to conservative investments over time which may improve investor results during extreme market events.
With these enhancements, MNSAVES was identified by Morningstar, Inc. as a best in class 529 plan, and was one of only 13 plans in the country to receive a "Silver" rating in 2019. MNSAVES was noted for its low fees, high quality investment strategies, and the State's strong oversight of the Plan*.
"It's no small achievement that Minnesotans have saved almost $1.5 billion dedicated to higher education expenses," said Chris Lynch, President of TIAA-CREF Tuition Financing, Inc. "Since MNSAVES launched in 2001, families have withdrawn more than $857 million from the Plan for qualified education expenses benefiting more than 31,000 children (as of 9/30/19). These statistics demonstrate the success of the Minnesota 529 College Savings Plan over the past 18 years and we look forward to future success as MNSAVES continues to fulfill their mission of supporting higher education with providing easy and affordable access to all Minnesota families."
About the Minnesota 529 College Savings Plan
The Minnesota College Savings Plan (MNSAVES), Minnesota's official 529 college savings plan, makes it easier for families to save for higher education expenses. It takes just $25 and 15 minutes to open a MNSAVES account and funds saved can be used at colleges, technical schools and graduate schools nationwide and many abroad. In addition to tuition, funds may be used for certain room and board expenses, books, supplies or other qualified expenses.
Minnesota taxpayers can reduce their state taxable income up to $1,500 per year per individual and up to $3,000 per year for a married couple filing jointly for 529 contributions. Or taxpayers may be eligible for a maximum state tax credit amount up to $500, subject to phase-out based on certain federal adjusted gross income thresholds. Deadline is 12/31 of the applicable calendar tax year.
*In an annual review of the largest 529 college-savings plans (62 total), Morningstar identified 30 plans that rose above their typical peers, awarding those plans Gold, Silver, and Bronze Morningstar Analyst Ratings for 2019. These forward-looking, qualitative ratings signal Morningstar's conviction in the plans' abilities to outperform their relevant benchmark and peer groups on a risk-adjusted basis over the long term. Morningstar evaluates college-savings plans based on five key pillars--Process, Performance, People, Parent, and Price. Gold- and Silver-rated plans are those that Morningstar analysts consider the most appealing to college savers, with reasonable fees, strong investment options, and capable oversight. Analysts award Bronze ratings to those plans that also have attractive features, although these plans don't garner as much conviction as the Gold- and Silver-rated plans. A Morningstar Analyst Rating for a 529 college savings plan is not a credit or risk rating. Analyst ratings are subjective in nature and should not be used as the sole basis for investment decisions.
**Strategic Insights 3rd Quarter 2019 529 Fee Analysis
To learn more about the Minnesota College Savings Plan, its investment objectives, tax benefits, risks, and costs please see the Plan Description at mnsaves.org. Read it carefully. Investments in the Plan are neither insured nor guaranteed and there is the risk of investment loss. Check with your home state to learn if it offers tax or other benefits such as financial aid, scholarship funds or protection from creditors only available for investing in its own 529 plan. Consult your legal or tax professional for tax advice. If the funds aren't used for qualified higher education expenses, a 10% penalty tax on earnings (as well as federal and state income taxes) may apply.
TIAA-CREF Individual & Institutional Services, LLC, Member FINRA, distributor and underwriter for the Minnesota 529 College Savings Plan.
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SOURCE Minnesota 529 College Savings Plan
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