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Montana Family Education Savings Program - CollegeSure® 529 Plan
Montana
Three FDIC-insured options are offered in this 529 plan: (1) the CollegeSure CD with a variable interest rate pegged to a private-college tuition index, (2) the InvestorSure CD with an interest rate pegged to a percentage of the increase in the S&P 500 Index over a five-year period, and (3) fixed-rate CDs with one-year or three-year maturities.
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General
Did you know?
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.
Program type:
Savings
How to enroll:
Enroll directly with the program.
Initial year of operation:
1998
State agency(ies):
Montana Board of Regents of Higher Education
Program manager:
College Savings Bank
Program distributor:
College Savings Bank
Manager contract term:
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Eligibility
State residency requirements:
None
Who can be a participant/owner in the program?
Individuals of legal age, UGMA/UTMA custodians, state/local governments, and 501(c)(3) organizations. Joint ownership by spouses is permitted.
Significant time or age restrictions imposed by the program:
CollegeSure® CDs have maturities ranging from one year to 22 years. InvestorSure CDs have a five-year maturity. Fixed-rate CDs have one- or three-year maturities. The CDs are subject to early redemption penalties ranging from 1% to 10% of principal for withdrawals prior to maturity.
Contributions
Maximum contributions:
Accepts contributions until all account balances in Montana's 529 plans for the same beneficiary reach $335,000.
Minimum contributions:
CollegeSure CD:
With lump-sum contributions, the minimum initial contribution is $250. With the automatic investment plan, the minimum contribution level is $100 per portfolio per month or $250 per quarter via bank transfer, or $25 per pay period via payroll deduction.
InvestorSure CD:
With lump-sum contributions, the minimum initial contribution is $500. With the automatic investment plan, the minimum contribution level is $250 per month via bank transfer, or $100 per pay period via payroll deduction. Deposits under $1,000 are held in an interest bearing savings account, and each time the balance reaches $1,000, a CD purchase is made.
Fixed Rate CDs:
With lump-sum contributions, the minimum initial contribution is $500. With the automatic investment plan, the minimum contribution level is $250 per month via bank transfer, or $100 per pay period via payroll deduction. Deposits under $500 are held in an interest bearing savings account, and each time the balance reaches $500, a CD purchase is made.
Investment Options
Age-based investment options:
None
Static investment options:
The interest rate on the CollegeSure CD is pegged to a private-college tuition index, less a 3% margin, not to fall below 2% annually. (If average private-college tuition increases by 6% over the term, the yield is 3%.) The InvestorSure CD has a five-year maturity, and earns interest tied to a percentage of the increase in the S&P 500 Index (between 85% and 100%). Fixed-rate CDs earn interest at the rate posted at the time of purchase, and posted rates may change at any time.
Underlying investments:
FDIC-insured certificates of deposit from College Savings Bank.
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:
None
Expenses of the underlying investments:
Not applicable, interest rate on CD is tied to a formula.
Total asset-based expense ratio:
None
Taxes and other Benefits
Program match on contributions:
None
State tax deduction or credit for contributions:
Contributions to any of Montana's 529 plans of up to $3,000 per year for an individual taxpayer, and $6,000 per year for married taxpayers filing jointly, are deductible in computing Montana taxable income. Only contributions made by the account owner, the account owner's spouse, or the account owner's custodian/parent are deductible. Contribution deadline is December 31 postmark.
Value of in-state tax benefits:
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State tax recapture provisions:
The principal portion of rollovers, qualified withdrawals within three years of establishing the account, and nonqualified withdrawals from this plan are subject to Montana tax at the highest Montana marginal rate to the extent of prior Montana tax deductions, but only after removal of non-deducted contributions.
State tax treatment of qualified distributions:
Montana law exempts qualified distributions from a Montana 529 plan (via specific exclusion) and from non-Montana 529 plans (via conformity to the federal tax exclusion).
State tax treatment of rollovers:
Montana follows tax-free treatment for rollovers into a Montana 529 plan. Montana tax treatment of rollovers out of a Montana 529 plan is unclear, as Montana law may require that the rollover be treated as a nonqualified withdrawal.
Does the sponsoring state exclude the value of an account for state financial aid purposes?
No
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:
Distributions are only made to the account owner at the address on record.
Account Changes
Policy regarding participant/owner changes:
Accepts requests to transfer account ownership (but only to the beneficiary, or to the owner’s spouse as part of a divorce proceeding).
Documents, Access & Reporting
Does participant have online password-protected access to account?
No
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
Telephone:
1-800-888-2723
Web site:
Plan News
- Montana 529 now offering S&P-linked equity CD (02/14/2008)
- Montana adds equity-indexed CD option (12/21/2007)
- Montana CollegeSure plan to offer equity-indexed CD (08/21/2007)
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