UPDATED FOR 2009

SHORTCUTS

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529 PLANS

Michigan Education Savings Program

Michigan

Similar to other TIAA-managed 529 savings programs, this one features an age-based option, three fixed multi-fund options, and a principal protection option.

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(Resident Rating)

(Non-Resident Rating)

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Obtain this plan's official enrollment materials by completing our form. It's free and we will forward your details to the program manager. Enroll Today!

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.

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Program type:

Savings

How to enroll:

Enroll directly with the program.

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, and 501(c)(3) organizations.

Significant time or age restrictions imposed by the program:

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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 three different risk levels (Aggressive, Moderate, and Conservative), each containing six 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 three multi-fund options (the 100% Equity Option, the 100% Fixed Income Option, and the Balanced 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:

0.45% manager fee; fee includes underlying fund expenses. No fee for the Principal Plus Interest Option.

Expenses of the underlying investments:

Not applicable, included in the program management fee.

Total asset-based expense ratio:

0.45%; None for the Principal Plus Interest Option

Taxes and other Benefits

Program match on contributions:

Michigan residents with adjusted gross income of $80,000 or less and a beneficiary under seven years old may apply for a one-time matching grant of $1 for every $3 contributed, up to a maximum $200 grant; the 2008 application deadline is September 30, 2008.

State tax deduction or credit for contributions:

Contributions to the Michigan Education Savings Plan of up to $5,000 per year for an individual taxpayer, and $10,000 per year for married taxpayers filing a joint return, 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. Rollovers may be subject to recapture.

State tax treatment of qualified distributions:

Michigan law exempts qualified distributions from MESP (via specific exclusion) and from MET and non-Michigan 529 plans (via conformity to the federal tax exclusion). Also excluded are distributions made due to the beneficiary's death, disability, scholarship, or attendence at one of the U.S. military academies.