|
 Investors would have saved nearly $3.6 million had the deal been in
place last year. Frerichs was sworn-in as Treasurer in January.
“A college education opens doors that otherwise would remain locked.
That is why we must do everything possible to make higher education
affordable for Illinois families,” Frerichs said.
The elimination of the $10 set-up fee and $3 quarterly maintenance
fee means more investment dollars will go to college savings.
Management fees also will be slashed by 43 percent. More than
104,000 accounts will benefit from the new terms, which take effect
Nov. 15.
Independent rating agencies recognize Bright Directions as a solid
investment with a competitive price that offers 55 investment
options. The new fee structure is a result of negotiations with
Union Bank, which was selected to manage the fund through a
competitively bid process.
In addition to Bright Directions, Frerichs’ office manages the
Bright Start Advisor and Bright Start Direct college savings
programs. Like Bright Directions, these plans are qualified tuition
programs under Section 529 of the Internal Revenue Code, which
allows individuals to invest in higher education without paying
taxes on earnings. Earnings can be spent on qualified expenses at
eligible educational institutions, including public and private
schools, two-year and four-year colleges and universities, and
certain technical and vocational schools.
Currently, more than 400,000 residents hold a Bright Directions or
Bright Start account.
For more information about the Treasurer’s Office 529 College
Savings programs, visit
www.illinoistreasurer.gov.
About the Illinois Treasurer
The Illinois Treasurer is the state’s Chief Investment Officer and
Frerichs is a Certified Public Finance Officer. He protects
consumers by encouraging savings plans for college or trade school,
increasing financial education among all ages, and removing barriers
to a secure retirement. As the state’s Chief Investment Officer, and
Certified Public Finance Officer, he actively manages approximately
$25 billion. Currently, the portfolio includes $13 billion in state
funds, $7 billion in college savings plans and $5 billion on behalf
of local and state governments. The investment approach is cautious
to ensure the preservation of principal and returns $28 to the state
for every $1 spent in operations. The Treasurer’s office predates
Illinois’ incorporation in 1818. Voters in 1848 chose to make it an
elected office.
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The Bright Directions College Savings Program is part of the Illinois
College Savings Pool and is designed to qualify as a qualified tuition program
under the provisions of Section 529 of the Internal Revenue Code. The Bright
Directions College Savings Program is sponsored by the State of Illinois and
administered by the Illinois State Treasurer, as Trustee. Union Bank & Trust
Company serves as Program Manager, and Northern Trust Securities, Inc. acts as
Distributor. Investments in the Bright Directions College Savings Program are
not guaranteed or insured by the State of Illinois, the Illinois State
Treasurer, Union Bank & Trust Company, Northern Trust Securities, Inc., the
Federal Deposit Insurance Corporation, or any other entity.
An investor should consider the investment objectives, risks, and charges and
expenses associated with municipal fund securities before investing. This and
other important information is contained in the fund prospectuses and the Bright
Directions Program Disclosure Statement (issuer’s official statement), which can
be obtained from your financial professional and on BrightDirections.com and
should be read carefully before investing. You can lose money by investing in a
portfolio. Each of the portfolios involves investment risks, which are described
in the Program Disclosure Statement.
An investor should consider, before investing, whether the investor’s or
designated beneficiary’s home state offers any state tax or other benefits that
are only available for investments in such state’s 529 plan. Investors should
consult a tax advisor.
[From the office of the Treasurer
Michael Frerichs] |
