Delaware College Investment Plan Enhancements Announced
Enhanced 529 Plan Features Lower-Costs and Index Fund Investing Options
Dover, DE - Delaware's families who are preparing to send a child to college received some news to be thankful for this Holiday season as State Treasurer and Chairperson of the Delaware College Investment Plan Jack Markell announced sweeping enhancements to the Delaware College Investment Plan that will assist families in saving for a child's education.
"Fewer than half of Delaware parents recently surveyed with children age ten or younger have started a college savings account," Mr. Markell said. "I'm delighted to announce that the Delaware College Investment Plan has added some real enhancements to encourage more Delaware families to open an account to prepare for college education."
The enhanced Delaware College Investment Plan, administered by Fidelity Investments, offers investors:
- A wider range of investment options for every type of investor, including new Index Fund investment options. Unlike "actively managed funds", index funds are mutual funds that invest in stocks or bonds that are included in a specific index and are not actively traded or managed by the portfolio manager.
- Lower fees. Fees on index portfolios are capped at 50 basis points. In addition, the minimum initial investment for all accounts has been reduced from $500 to $50. The minimum monthly investment has been reduced from $50 to $15.
- New opportunities to earn rebates through credit card purchases. Fidelity offers a Fidelity Investments 529 College Rewards ® American Express ® Card which allows participants of Fidelity's direct and advisor-sold plans to earn rebates on all net retail purchases. In addition, Fidelity 529 College Rewards American Express Cardmembers have access to special offers to save on dining, shopping, travel and more.
"Delaware families have been asking for additional, low-cost college savings options, so we're excited to be able to announce these enhancements to the Delaware College Investment Plan," Markell said.
The 529 Delaware College Investment Plan, administered by Fidelity Investments, provides professionally managed investments, high contribution limits, no income restrictions, and the ability for parents, guardians or grandparents to maintain control of an account specifically dedicated for college or accredited trade school expenses. The plan offers unlimited, complimentary planning and guidance services to participating families.
529 savings plans are named for a section of the federal tax code that allows parents, grandparents and others to set up investment accounts for college expenses. The investments grow tax-free and are free of federal tax when the funds are used to pay for tuition, fees, room, board, books and supplies. In most instances, the funds can be used for any college or university, not just schools in the state that sponsors the plan. Because Delaware follows federal tax regulations, withdrawals from the Delaware College Investment Plan are completely tax-free for residents. Currently over 23,470 families participate in the Fidelity administered plan and they have saved over $300 million for education.
To learn more about the new enhancements to the Delaware College Investment Plan or to set up an account, please call Fidelity at 800/343-3548 or visit www.fidelity.com/delaware
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Brokerage services are provided by Fidelity Brokerage Services LLC, Member NYSE, SIPC.
