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Bright Directions College Savings Program
The Illinois Bright Directions College Savings Program, sold through brokers and fee-based financial advisors, features an extensive multi-manager platform offering a large number of age-based, static multi-fund, and individual-fund options. To find a financial advisor in your area, use the Directory of Financial Professionals.
Savingforcollege.com's 5-Cap Ratings provides an evaluation and comparison of 529 plans, utilizing a formula that examines dozens of factors grouped into the following categories. (Scale 0 to 5; 5 is highest)
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Enroll in Bright Directions College Savings Program through a financial advisor. Search our directory of qualified financial professionals to find one near you.
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Residents are not limited to investing in their own state's plan. Another state may offer a plan that performs better and has lower fees. If there is no tax break offered for in-state investors ... shop around!
Also, the plan chosen does not affect which state the student enrolls in. An investor can live in NY, invest in a plan from NV and send a student to college in FL.
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Illinois State Treasurer
Union Bank and Trust Company of Lincoln, Nebraska
Northern Trust Securities, Inc.
Through July 19, 2017.
Individuals, UGMA/UTMA custodians, and certain legal entities.
Accepts contributions until all account balances in Illinois' 529 plans for the same beneficiary reach $350,000.
The Age-Based option is offered in 3 different risk levels (Aggressive, Growth, and Balanced) each containing 5 portfolios of underlying mutual funds. Contributions are placed into the portfolio corresponding to the risk level selected and the number of years to expected enrollment, and later reassigned to more conservative portfolios as the beneficiary approaches college age.
Select among 7 multi-fund Target portfolios with varying risk tolerances and 32 individual-fund portfolios. Certain portfolios consist of underlying investments managed by women- and minority-owned investment managers. Fifteen additional individual portoflios invest in Vanguard ETF funds and are available only to account owners who establish an account through a registered investment advisor or advisor who is not compensated through commissions.
T. Rowe Price, DFA, Dodge & Cox, Harbor Funds, PIMCO, BlackRock, American Century, Baird Funds, MainStay Investments, Delaware Funds, Northern Funds, William Blair, Voya, Calvert, Templeton, Causeway, Ariel Investments,MFS, Oppenheimer Funds, Sit Mutual Funds, and Vanguard (Class F only).
Click here, you need Microsoft Excel to open this document.
Click here to visit, link to the program website containing most current performance data.
Fees & Expenses
0.23% manager fee (including 0.05% state fee), plus distribution/servicing fees of 0.25% (Classes A and E, except 0% for Money Market), plus distribution/servicing fees of 0.50% (Class C, except 0% for Money Market), or 0% distribution/servicing fee (Class F). 0.21% manager fee (including 0.03% state fee) for Class F Vanguard ETF portfolios.
Ranges from 0.26% to 0.49% (portfolio weighted average) in the age-based and static multi-fund portfolios, 0.07% to 1.34% in the individual-fund portfolios, and 0.72% to 1.34% in the female- and minority-owned portfolios.
Class A: 0.44% - 1.82%
Class C: 0.44% - 2.07%
Class E: 0.44% - 1.82%
Class F: 0.28% - 1.57%
BlackRock Cash Funds 529 Portfolio, PIMCO Short-Term 529 Portfolio, and Baird Short-Term Bond 529 Portfolio:
No sales charge, dealer receives 0.25% annual trail beginning immediately (except no trail on the BlackRock Cash Funds 529 Portfolio)
For all other portfolios:
Initial sales charge: 3.50%
Dealer: 3% commission and 0.25% annual trail beginning immediately
No sales charge or CDSC
Dealer: 0.50% commission and 0.50% annual trail beginning in month 13
No sales charge or CDSC
Dealer: 0.25% annual trail beginning immediately
(This share class is available only to account owners investing in the program through an employer-sponsored option.)
No sales charge or CDSC
Fee-based adviser: no compensation from the distributor (This share class is available only through qualifying fee-based registered investment advisers.)
Taxes and other Benefits
Contributions to an Illinois 529 plan of up to $10,000 per year by an individual, and up to $20,000 per year by a married couple filing jointly, are deductible in computing Illinois taxable income. For a rollover contribution, only the principal portion is eligible for the deduction. Contribution deadline is December 31 postmark. For tax years ending on or between 12/31/09 and 12/31/20, employers may claim a credit against Illinois tax for 25% of matching contributions made to an employee's account in an Illinois 529 plan, with a maximum annual credit of $500 per employee. Unused credits may be carried forward for five years.
Investment time horizon:
18 yrs (i.e. newborn): 0.22% annualized
10 yrs (i.e. 8-yr old): 0.39% annualized
2 yrs (i.e. 16-yr old): 1.97% annualized
Based on 5% IL tax rate. (For assumptions see 529 State Tax Calculator.)
Effective January 1, 2007, rollovers from this plan to an out-of-state program are included in Illinois taxable income to the extent of prior Illinois deductions. Effective January 1, 2009, nonqualified distributions from this plan are included in Illinois taxable income to the extent of prior Illinois deductions.
Qualified distributions from an Illinois 529 plan are exempt. Qualified distributions from a non-Illinois plan are exempt provided the plan meets certain disclosure requirements.
Illinois follows federal tax-free treatment except that, beginning in 2007, outbound rollovers are subject to the recapture of prior state tax deductions.
Does participation in the program provide beneficiaries with any advantages in qualifying for resident tuition status at state institutions?
Yes, Bright Directions 529 College Savings Visa with a 1.529% reward on qualifying purchases.
Under Illinois law, effective June 1, 2008, moneys held in an Illinois 529 account shall be exempt from all claims of the creditors of the participant, donor, or designated beneficiary of that account, except for certain fraudulent conveyances, for contributions during the 365 day period prior to filing for bankruptcy that in the aggregate are in excess of the amount of the annual gift tax exclusion, and for contributions during the 730 to 366 day period prior to filing for bankruptcy that in the aggregate are in excess of the ammount of the annual gift tax exclusion.
Distributions & Terminations
Eligible educational institution, beneficiary, or account owner, as directed by the account owner
Accepts requests to transfer account ownership.
Documents, Access & Reporting