529 college savings plans can be confusing, and people may have misconceptions about how 529 college savings plans work. Here is the truth.

 

Fiction: The assets in your SSGA Upromise 529 Plan account can only be used at schools in your home state.

Fact: You can use the assets in your SSGA Upromise 529 Plan account at any eligible school around the country and abroad, including 2- and 4-year colleges, graduate schools (including law and medical), and vocational/technical schools.1

 

Fiction: You can only use the assets in your SSGA Upromise 529 Plan account to pay for tuition.

Fact: You can use your SSGA Upromise 529 Plan account assets for many higher education expenses, including tuition, fees, and certain room and board costs.2

 

Fiction: It costs a lot to open and maintain an account.

Fact: You can open a SSGA Upromise 529 Plan account with as little as $15. You can also set up payroll direct deposit for $15 per paycheck or an automatic investment plan (AIP) for $50 per month.3 To help families save more, the SSGA Upromise 529 Plan offers additional programs, like Ugift — Give College Savings, which allows account owners to invite family and friends to make gift contributions, and Upromise rewards, a service that lets account owners earn college savings when they shop online, dine out, and more.4

 

Fiction: You have to make a lot of investment decisions.

Fact: We’ve made it easy. The SSGA Upromise 529 Plan offers four types of investments. The College Date Portfolios are designed to make investing as easy as selecting the year in which the beneficiary is expected to start college. With a college date investment option, the portfolio’s investment track is automatically adjusted from more aggressive to more conservative as your beneficiary grows older (and closer to the selected college date year). If you prefer investing in strategies that are designed specifically to match the level of risk you are comfortable taking on in your account, then the Risk-Based Portfolio choices may be a good fit for you. You can also choose from 15 Static Portfolio options to create your own personalized investment mix. Lastly, The Savings Portfolio is a lower-risk, Federal Deposit Insurance Corporation (FDIC)-insured option for account owners seeking a conservative investment choice for their college savings.

 

Fiction: It's too late to start a 529 plan.

Fact: It's never too late. Even if your student is in high school you can benefit from a 529 plan. Earnings grow federal tax deferred in a SSGA Upromise 529 Plan account, and when you withdraw the money for a qualified higher education expense, it's federal tax free.2 Any assets not used can be rolled over to another family member (as per Plan rules).

 

Fiction: You make too much money for a 529 plan account.

Fact: There are no income limitations for the SSGA Upromise 529 Plan. In fact, as part of the tax advantages offered by a 529 plan, account owners can contribute $14,000 ($28,000 if married, filing jointly) in a single year without incurring a gift tax.

 

Fiction: A 529 plan is only for kids.

Fact: There’s no maximum age for a 529 plan. Are you considering career retraining or an advanced degree? As long as your school is eligible, you can use your 529 plan assets — even if you’re not attending full-time.

 

Fiction: If the child doesn’t go to college, you lose your money.

Fact: The 529 plan account owner controls the account. That means you can change your beneficiary to another eligible “member of the family” (as per IRS rules) with no tax penalty.5

 

Fiction: Only a parent can be an account owner.

Fact: Parents, grandparents, aunts, uncles, friends…almost anyone can be an account owner.6 You can also open an account for your own education.

 

Fiction: It’s difficult to open up a 529 plan account.

Fact: It's fast and easy to enroll online. You can open an SSGA Upromise 529 Plan account at nevadas529.com.

 

Fiction: It’s too hard for family members to contribute to my child’s 529 plan account.

Fact: Using Ugift, family members or friends can easily contribute to any of your accounts. Contributions can be made online or by check, with no service fees or registrations for the gift giver.


1 An eligible institution is one that can participate in federal financial aid programs.

2 Earnings on non-qualified withdrawals are subject to federal income tax and may be subject to a 10% federal penalty tax, as well as state and local income taxes. The availability of tax or other benefits may be contingent on meeting other requirements.

3 A plan of regular investment cannot assure a profit or protect against loss in a declining market.

4 Upromise rewards is an optional service offered by Upromise, Inc., is separate from the SSGA Upromise 529 Plan, and is not affiliated with the State of Nevada. Terms and conditions apply to the Upromise service. Participating companies, contribution levels, and terms and conditions are subject to change at any time without notice. Upromise, Inc. is affiliated with Sallie Mae Bank.

5 You should consult with a tax advisor when considering a change of beneficiary.

6 You must be a U.S. citizen or resident alien, have a Social Security number or tax Identification number, and have a permanent U.S. address (not a P.O. Box).

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Reach out to the SSGA Upromise 529 Plan

For more information about the SSGA Upromise 529 Plan ("the Plan") download the Plan Description and Participation Agreement or request one by calling 1-800-587-7305. Investment objectives, risks, charges, expenses, and other important information are included in the Plan Description and Participation Agreement; read and consider it carefully before investing.

Please Note: Before investing in any 529 plan, you should consider whether your or the beneficiary's home state offers a 529 plan that provides its taxpayers with favorable state tax and other benefits that are only available through investment in the home state's 529 plan. You also should consult your financial, tax, or other advisor to learn more about how state-based benefits (or any limitations) would apply to your specific circumstances. You also may wish to contact directly your home state's 529 plan(s), or any other 529 plan, to learn more about those plans' features, benefits and limitations. Keep in mind that state-based benefits should be one of many appropriately weighted factors to be considered when making an investment decision.

The Plan is administered by the Board of Trustees of the College Savings Plans of Nevada (the "Board"), chaired by the Nevada State Treasurer. Ascensus Broker Dealer Services, Inc. (“ABD”) serves as the Program Manager. ABD has overall responsibility for the day-to-day operations, including distribution of the Plan and provision of certain marketing services. State Street Global Advisors (“SSGA”) serves as Investment Manager for the Plan except for the Savings Portfolio, which is managed by Sallie Mae Bank, and also provides or arranges for certain marketing services for the Plan. The Plan's Portfolios invest in either (i) Exchange Traded Funds and mutual funds offered or managed by SSGA or its affiliates; or (ii) a Federal Deposit Insurance Corporation (FDIC)-insured omnibus savings account held in trust by the Board at Sallie Mae Bank. Except for the Savings Portfolio, investments in the Plan are not insured by the FDIC. Units of the Portfolios are municipal securities and the value of units will vary with market conditions.

Investment returns will vary depending upon the performance of the Portfolios you choose. Except to the extent of FDIC insurance available for the Savings Portfolio, you could lose all or a portion of your money by investing in the Plan, depending on market conditions. Account Owners assume all investment risks as well as responsibility for any federal and state tax consequences.

Upromise is an optional service offered by Upromise, Inc., is separate from the SSGA Upromise 529 Plan, and is not affiliated with the State of Nevada or ABD. Separate terms and conditions apply to the Upromise service and are available on the Upromise website at www.upromise.com. Participating companies, contribution levels, and terms and conditions are subject to change at any time without notice. Transfers from Upromise to an SSGA Upromise 529 Plan account are subject to a $25 minimum.

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Upromise and the Upromise logo are registered service marks of Upromise, Inc. Ugift is a registered service mark of ABD. State Street Global Advisors and SSGA are registered trademarks of State Street Corporation. All other marks are the exclusive property of their respective owners. Used with permission.