Montana 529 Plan F.A.Q.
The information represented in this F.A.Q. is not meant for, nor should it be used as, the basis for any investment decisions. MGSLP suggests you contact either College Savings Bank or Pacific Life Funds, or speak with an investment professional before investing in a 529 plan.
Frequently Asked Questions about Montana's 529 College Savings Plan
What is a 529 plan?
Why Should I invest in a 529 plan?
Does Montana have a 529 plan?
Who manages the MFESP?
What are my investment options with MFESP?
Does the MFESP offer any type of index fund?
What are the advantages of MFESP?
Am I only allowed to invest in MFESP?
What are the fees associated with MFESP?
Does the MFESP charge any type of account maintenance fee?
What options do I have for purchasing shares in MFESP?
How can I contribute to my account?
As an employer, how do I make payroll deductions available for my employees?
What is a 529 plan?
A 529 plan is a tax advantaged college savings vehicle, named after section 529 of the internal revenue code. With a 529 plan, contributions into an account are allowed to grow tax free, while at the same time allowing for tax free disbursements when the funds are used to pay for schooling at any accredited institution world wide. 529 plans are sponsored by a state’s government and are usually managed by a program administrator. Most states offer tax incentives for resident investors who contribute to 529 plans.
Why Should I invest in a 529 plan?
As college costs continue to rise, a 529 college savings plan is one of the best mechanisms available to families to pay for college. By combining a well thought-out investment strategy with the tax advantages offered by many states, a 529 college savings account is an outstanding way to cover the cost of college.
Does Montana have a 529 plan?
Yes, Montana has its own 529 plan which is collectively called the Montana Family Education Savings Plan, or MFESP.
Who manages the MFESP?
The Montana Board of Regents of Higher Education (the program trustee) has contracted with College Savings Bank to serve as the program manager of Montana 's 529 plan. College Savings Bank in turn has contracted with Pacific Life Funds to serve as investment manager. Both College Savings Bank and Pacific Life offer college savings products through the Montana 529 plan.
What are my investment options with MFESP?
MFESP offers you two ways to save for your child’s education. You can choose from College Savings Bank’s FDIC insured CollegeSure CD, or the Pacific Life Funds 529 College Savings Plan (MT), which offers 5 investment choices. Or you can use both to save for your child’s future.
Does the MFESP offer any type of index fund?
Yes. The Montana Family Education Savings Program recently added a new investment product called the InvestorSure CD. The InvestorSure CD is a variable rate certificate of deposit indexed to the Standard and Porrs' 500 Composite Stock Price Index (S&P 500). The InvestorSure CD does not risk prinicipal and is FDIC insured for up to $100,000. For more information please visit the Montan Family Education Savings Program's website.
What are the advantages of MFESP?
There are several reasons to invest in Montana 's 529 plan:
Montana residents may invest in any state 529 plan they choose, however, a resident may only receive a reduction to their state adjusted gross income when they invest in MFESP.
What are the fees associated with MFESP?
There are several fees generally associated with the MFESP:
Does the MFESP charge any type of account maintenance fee?
Pacific Life Fund's Mutual Fund accounts are charged a $25 annual maintenance fee. However, the fee is waived for accounts which 1) have balances greater than $25,000, 2) have a preauthorized automatic or payroll deduction agreement, or 3) are purchased direct by a Montana resident. College Savings Bank does not charge an annual fee.
What options do I have for purchasing shares in MFESP?
Montana residents have the option of purchasing shares either with the assistance of an investment professional (advisor sold), or by contacting the vendor directly to open an account (direct sold). Purchasing directly waives any front end sales charge that would normally be paid to the investment professional.
How can I contribute to my account?
Contributions to your 529 account may be made by the following means:
Employers interested in offering payroll deductions should call (800) 888-2723 for College Savings Bank and (800) 722-2333 for Pacific Life Funds.
Frequently Asked Questions about Montana's 529 College Savings Plan
What is a 529 plan?
Why Should I invest in a 529 plan?
Does Montana have a 529 plan?
Who manages the MFESP?
What are my investment options with MFESP?
Does the MFESP offer any type of index fund?
What are the advantages of MFESP?
Am I only allowed to invest in MFESP?
What are the fees associated with MFESP?
Does the MFESP charge any type of account maintenance fee?
What options do I have for purchasing shares in MFESP?
How can I contribute to my account?
As an employer, how do I make payroll deductions available for my employees?
What is a 529 plan?
A 529 plan is a tax advantaged college savings vehicle, named after section 529 of the internal revenue code. With a 529 plan, contributions into an account are allowed to grow tax free, while at the same time allowing for tax free disbursements when the funds are used to pay for schooling at any accredited institution world wide. 529 plans are sponsored by a state’s government and are usually managed by a program administrator. Most states offer tax incentives for resident investors who contribute to 529 plans.
Why Should I invest in a 529 plan?
As college costs continue to rise, a 529 college savings plan is one of the best mechanisms available to families to pay for college. By combining a well thought-out investment strategy with the tax advantages offered by many states, a 529 college savings account is an outstanding way to cover the cost of college.
Does Montana have a 529 plan?
Yes, Montana has its own 529 plan which is collectively called the Montana Family Education Savings Plan, or MFESP.
Who manages the MFESP?
The Montana Board of Regents of Higher Education (the program trustee) has contracted with College Savings Bank to serve as the program manager of Montana 's 529 plan. College Savings Bank in turn has contracted with Pacific Life Funds to serve as investment manager. Both College Savings Bank and Pacific Life offer college savings products through the Montana 529 plan.
What are my investment options with MFESP?
MFESP offers you two ways to save for your child’s education. You can choose from College Savings Bank’s FDIC insured CollegeSure CD, or the Pacific Life Funds 529 College Savings Plan (MT), which offers 5 investment choices. Or you can use both to save for your child’s future.
Does the MFESP offer any type of index fund?
Yes. The Montana Family Education Savings Program recently added a new investment product called the InvestorSure CD. The InvestorSure CD is a variable rate certificate of deposit indexed to the Standard and Porrs' 500 Composite Stock Price Index (S&P 500). The InvestorSure CD does not risk prinicipal and is FDIC insured for up to $100,000. For more information please visit the Montan Family Education Savings Program's website.
What are the advantages of MFESP?
There are several reasons to invest in Montana 's 529 plan:
- If you are a Montana resident you may deduct up to $3,000 ($6,000 if married and filing jointly) annually from your Montana adjusted gross income.
- Montana has one of the only 529 investment options in the nation, which charges 0% per contribution. The CollegeSure CD from College Savings Bank is a no fee based option whether purchasing direct or through a financial advisor. College Savings Bank will even pay up to 4% of advisor fees on your behalf if you choose to purchase with the assistance of an investment manager.
- MFESP has been recognized as an “excellent program” by industry experts such as Savingforcollege.com which recently awarded the Montana 529 plan a 3.5 and 4 out of 5 cap rating.
Montana residents may invest in any state 529 plan they choose, however, a resident may only receive a reduction to their state adjusted gross income when they invest in MFESP.
What are the fees associated with MFESP?
There are several fees generally associated with the MFESP:
- Investments through College Savings Bank have no fees.
- Investments purchased directly from Pacific Life have fees that range from 1.18% to 1.44%.
- There is an additional advisor fee of 5.5% when investors utilize an investment advisor.
Does the MFESP charge any type of account maintenance fee?
Pacific Life Fund's Mutual Fund accounts are charged a $25 annual maintenance fee. However, the fee is waived for accounts which 1) have balances greater than $25,000, 2) have a preauthorized automatic or payroll deduction agreement, or 3) are purchased direct by a Montana resident. College Savings Bank does not charge an annual fee.
What options do I have for purchasing shares in MFESP?
Montana residents have the option of purchasing shares either with the assistance of an investment professional (advisor sold), or by contacting the vendor directly to open an account (direct sold). Purchasing directly waives any front end sales charge that would normally be paid to the investment professional.
How can I contribute to my account?
Contributions to your 529 account may be made by the following means:
- Payment by check, the first of which must include a minimum initial investment of $500.00 for Pacific Life Funds and $250.00 for College Savings Bank.
- Payment through automatic withdrawal from a bank account. This is a preauthorized agreement between you and the program manager to automatically withdraw a set amount per month from your bank account and deposit it into your 529 account. Payment by this means waives the initial investment.
- Payment through payroll deduction is also available, if such a service is offered by your employer. Check with your employer to see if payroll deduction services are offered. Payment by this means waives the initial investment.
Employers interested in offering payroll deductions should call (800) 888-2723 for College Savings Bank and (800) 722-2333 for Pacific Life Funds.
