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Michigan Education Savings Program

Michigan

The Michigan Education Savings Program is similar to other TIAA-managed 529 savings programs. The Program features an age-based option, four multi-fund options, a single fund option and a principal protection option.

5-Cap Rating

Resident:
Non-Resident:

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)

Performance Costs Features Reliability Resident Upgrade
3.80 4.59 2.67 4.80 0.40

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General

Program type:

Savings

How to enroll:

Enroll directly with the program. Enroll Now

Initial year of operation:

2000

State agency(ies):

Michigan Department of Treasury

Program manager:

TIAA-CREF Tuition Financing, Inc.

Program distributor:

TIAA-CREF Individual & Institutional Services, LLC

Manager contract term:

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Eligibility

State residency requirements:

None

Who can be a participant/owner in the program?

U.S. citizens and resident aliens, UGMA/UTMA custodians, estates, trusts, 501(c)(3) organizations, corporations, and state or local government agencies and instrumentalities.

Significant time or age restrictions imposed by the program:

None

Contributions

Maximum contributions:

Accepts contributions until all account balances in Michigan's 529 plan for the same beneficiary reach $235,000.

Minimum contributions:

$25, or $15 per pay period via payroll deduction.

Investment Options

Age-based investment options:

The Age-Based Option is offered in 3 different risk levels (Aggressive, Moderate, and Conservative), each containing 9 portfolios of underlying mutual funds. Contributions are placed into the portfolio corresponding to the beneficiary's age and later reassigned to more conservative portfolios as the beneficiary approaches college age.

Static investment options:

Select among 4 multi-fund options (the International Equity Index Option, the Global Equity Index Option, the 100% Fixed Income Option, and the Balanced Option), the U.S. Equity Index Option and the Principal Plus Interest Option

Underlying investments:

TIAA-CREF institutional mutual funds. The Principal Plus Interest Option is invested in a funding agreement with TIAA-CREF Life Insurance Company that guarantees principal and a minimum annual rate (actual rate is declared annually).

Underlying fund allocations:

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Investment performance link:

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Portfolio Fees & Performance Lookup

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Fees & Expenses

Enrollment or application fee:

None.

Account maintenance fee:

None.

Program management fees:

0.06% manager fee plus 0.05% state fee. No fee for the Principal Plus Interest Option.

Expenses of the underlying investments:

0.07% - 0.17%. None for the Principal Plus Interest Option.

Total asset-based expense ratio:

0.20% - 0.30%. None for the Principal Plus Interest Option.

Taxes and other Benefits

Program match on contributions:

Michigan matching grants based on MESP contributions have been discontinued for the 2009-2010 year. In prior years, a Michigan resident with adjusted gross income of $80,000 or less and a beneficiary under seven years old could apply for a one-time matching grant of $1 for every $3 contributed, up to a maximum $200 grant.

State tax deduction or credit for contributions:

Contributions to a Michigan's 529 savings plan of up to $5,000 per year by an individual, and up to $10,000 per year by a married couple filing jointly, are deductible in computing Michigan taxable income. Contributions must be reduced by qualified withdrawals during the year for purposes of determining the amount that may be deducted. Rollover contributions are not deductible, according to the Michigan Department of Treasury. Contribution deadline is December 31.

Value of in-state tax benefits:

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State tax recapture provisions:

The principal portion of nonqualified withdrawals from this plan are included in Michigan taxable income to the extent of prior Michigan tax deductions. Qualified rollovers are not subject to recapture.

State tax treatment of qualified distributions:

Qualified distributions from Michigan and non-Michigan 529 plans are exempt. Also excluded are distributions made due to the beneficiary's death, disability, scholarship, or attendence at one of the U.S. military academies.

State tax treatment of rollovers:

Michigan follows federal tax-free treatment.

Does the sponsoring state exclude the value of an account for state financial aid purposes?

Yes

Does participation in the program provide beneficiaries with any advantages in qualifying for resident tuition status at state institutions?

No

Does the program have a formal agreement with a rewards program or outside scholarship program?

No

Statutory protection of an account from creditors:

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Distributions & Terminations

To whom are distributions made payable:

Eligible educational institution, beneficiary, institution and beneficiary jointly, or account owner, as directed by the account owner.

Account Changes

Policy regarding participant/owner changes:

Accepts requests to transfer account ownership.

Documents, Access & Reporting

Does participant have online password-protected access to account?

Yes

Can the complete enrollment process including funding be done online?

Yes

Documents and other services accessible or downloadable on the program's public Web site:

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Contact

Web site:

visit Enroll Now

Telephone:

1-877-861-6377

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