Using 529 plans makes saving for college easier and more affordable for families. But, did you know the option wasn’t always available?
Congress created the state plans in 1996 by writing a section of IRS tax code – section 529 – that allowed states to offer the option to families. On July 7, 1997, Wisconsin opened its first prepaid Tuition Unit college savings accounts, pre-cursor to the popular Edvest (direct-sold) and Tomorrow’s Scholar (advisor-sold) plans.
Over the last 20 years, the Wisconsin College Savings Program has helped thousands of families save for their child’s higher education expenses. Edvest and Tomorrow’s Scholar have grown to more than $4.4 billion in assets and over 200,000 accounts. More than $3 billion has been distributed over the years to pay for college expenses—dollars that did not have to be borrowed in the form of student loans.
20 Years of Connecting with People
Edvest, Wisconsin’s direct-sold college savings plan isn’t the same program it was 20 years ago – and that’s great! As the needs of families change, Edvest is committed to changing along with them offering lower costs, a wider selection of investment options and digital access to your accounts and Plan news.
Today, Edvest ranks as the fifth lowest-fee 529 plan in the nation1 and decreased fees by more than 60% in October 2012. Age-based investments are now offered, which automatically shift from an aggressive to a conservative mix as a child ages. And Wisconsin’s state tax benefit for Edvest and Tomorrow’s Scholar is now linked to an inflation calculation and includes a carry-forward provision.
Families can now log on to Edvest.com to open or manage their account across multiple devices virtually anywhere. It’s easy for everyone to stay connected with Edvest through social media, a phone call, or at in-person events and appearances throughout the state (Wisconsin Farm Technology Days is coming up in Kewaunee County, July 11 to 13 – will we see you there?).
20 Years of Excellence
In 2016, Edvest again received a 5-Cap Rating2 for in-state residents by SavingForCollege.com – the highest rating given by the organization – for its overall attractiveness to investors. Edvest has also maintained a Bronze Rating3 by Morningstar in the organization’s annual review of 529 plans.
We know Wisconsin families are counting on us to help their little ones’ dreams come true. That’s why we worked hard over the last 20 years to be a plan you can count on, and why we will keep working hard at that for the next 20 years and beyond.
1The Strategic Insight 529 College Savings Quarterly Fee Analysis (Q1 2017) is based on program descriptions and participating agreement documents gathered by a third-party research firm and analyzed by Strategic Insight. As part of the process, Strategic Insight analyzes the 529 program manager and state agency disclosure statements, press releases and organization websites to ensure data quality and categorization. The average minimum, maximum and total annual asset based fees at the plan levels are calculated via an un-weighted index average, or arithmetic mean method.
2Source: Savingforcollege.com, January 5, 2016. The Edvest College Savings Plan received a 5-Cap Rating for Wisconsin residents and non-residents. A 5-Cap Rating represents the attractiveness of a 529 plan, relative to all other 529 plans, by assigning an overall rating to each 529 program ranging from 1 Cap (least attractive) to 5 Caps (most attractive). 5-Cap Ratings represent an assessment based on many considerations such as flexibility, liquidity and availability, ownership rights, state benefits, investment approach and safety, program resources and financial aid impact. It is not strictly a measure of historical returns, and it is not a predictor for future investment performance, level of investment risk or financial solvency of the program funds. These ratings are not the result of a fixed formula and a significant portion of the analysis is subjective. Past performance does not guarantee future results.
3Source: http://news/morningstar.com. In an annual review (10/25/2016) of the largest 529 college-savings plans (63 total), Morningstar identified 33 plans that rose above their typical peers, awarding those plans Gold, Silver, and Bronze Morningstar Analyst Ratings for 2016. 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. For more information about Morningstar’s overview of Edvest go to 529.morningstar.com. Past performance does not predict future results.
To learn more about the Wisconsin College Savings Plan, its investment objectives, tax benefits, risks, and costs please see the Disclosure Booklet at edvest.com. Read it carefully. Investments in the Plan are neither insured nor guaranteed and there is the risk of investment loss. If the money isn’t used for qualified higher-education expenses, a 10% penalty tax on earnings (as well as federal and state income taxes) may apply. Check with your home state to learn if it offers tax or other benefits for investing in its own 529 plan.
Taxpayers should seek advice from an independent tax advisor based on their own particular circumstances.
Neither TIAA-CREF Tuition Financing, Inc., nor its affiliates, are responsible for the content found on any external website links contained herein.
TIAA-CREF Tuition Financing, Inc., Plan Manager. TIAA-CREF Individual & Institutional Services, LLC, member FINRA, distributor and underwriter for the Wisconsin College Savings Plan.
All social media platforms are managed by the State of Wisconsin.