Checklist for the TNStars College Savings 529 Program

The Savingforcollege.com 529 Selection Checklist is a simple tool designed to assist you in your research and selection of a 529 college savings plan. Before investing in a 529 plan, be sure to read the official program offering materials.

Steps:

1. Use a separate checklist for each 529 plan you are considering.
2. Use the "Notes" line to add any notes or thoughts you feel are relevant to that particular question. Information about the 529 plan being evaluated can be gathered from its official program disclosures, the plan web site, and third-party sources like Savingforcollege.com.
3. Use the "Acceptable, Unacceptable, or Not Important" checkboxes to indicate your conclusions as to how well the 529 plan you are evaluating meets the various criteria. Some criteria will not make any difference in your selection of your plan and should be noted as Not Important. In lieu of simply indicating acceptable or unacceptable you may want to develop a rating scale, e.g. 1 through 5.
4. Compare the checklists for the various 529 plans being considered and use the results to help you select the appropriate 529 plan.

Enrollment Issues:

Who is eligible to use this particular 529 plan?

U.S. citizens and legal residents at least 18 years old, UGMA/UTMA custodians, and legal entities.

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How do I enroll: through a financial advisor (generally higher expense) or directly with the program (generally lower expenses)?

Enroll directly with the program.

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What, if any, age or time limits are imposed by this 529 plan that may restrict how long I can hold the plan?

Any contribution made to an account must be on the account for 21 days before it can be withdrawn.

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Can I complete the enrollment process for this 529 plan online (including funding the account)?

Yes

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Can I meet the plan's minimum contribution requirements either with a lump-sum contribution or by signing up for automatic contributions?

The minimum initial or subsequent contribution to an account for each investment option is $25. Once an initial contribution is made to the account, there are no required subsequent contributions. There is a minimum $25 contribution to establish the account, regardless of the number of investment options selected.

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Is the plan's maximum contribution limit high enough to accommodate my college funding desires?

$350,000 including all accounts in the program held for the same beneficiary

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Will this 529 plan allow my other relatives and friends to make contributions directly to my account?

Yes

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Program benefits:

If I live in the state offering this 529 plan, what are the state income tax deductions or credits I can claim for my contributions to it? (Note: If you live in Arizona, Kansas, Missouri, Maine, and Pennsylvania you do not have to use the in-state 529 plan to claim a deduction).

Not applicable. Tennessee does not have a personal income tax.

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If I live in the state offering this 529 plan, what matching contributions might I be eligible for?

Under the Tennessee Investments Preparing Scholars Program (TIPS), eligible families can receive a matching contribution of $100 for a minimum $25 investment, or $500 for a minimum $125 investment. Beneficiaries can receive a maximum match of $500 per year with a $1,500 lifetime maximum benefit per beneficiary.

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If the state offering this 529 plan administers its own student financial aid programs, will my account in this plan be excluded for purposes of determining eligibility?

No

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If I prefer an investment that automatically changes to a more conservative asset mix as my child approaches college age, what "age-based" options are offered in this 529 plan?

An age-based option offers ten age bands. Contributions are placed into the portfolio corresponding to the beneficiary's age and automatically shift to a more conservative portfolio over time.

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If I prefer one or more investments that do not adjust over time, what "static" options are offered in this 529 plan?

Select among 15 individual options investing in Vanguard, DoubleLine, Western Asset or Primecap funds

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Which mutual fund families, or other investment managers, are utilized in this 529 plan? Do the investment options consist of a single fund family or a mix of fund families?

Vanguard in the age-based option; Vanguard, DoubleLine, Western Asset and Primecap in the individual options.

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Does my preferred investment option in this program include foreign stocks, real estate, inflation-adjusted securities, or other sectors that I feel are desirable?

Vanguard in the age-based option; Vanguard, DoubleLine, Western Asset and Primecap in the individual options.

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Which type of mutual funds does my preferred investment option use: actively managed funds or passively managed index funds?

Both

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What is my assessment of the quality of the particular investment options in this 529 plan?

Both

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How acceptable is the range of investment options in this 529 plan in the event I wish to change investment options in the future?

Both

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Fees and expenses:

How much is the enrollment fee in this 529 plan? Do I qualify for a waiver?

None

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Notes: _______________________________________________________________________

How much is the account maintenance fee in this 529 plan? Do I qualify for a waiver?

None

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What is the total asset-based expense ratio (or range of ratios) for the investment options in this plan?

0.23% to 0.85%

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How do the fees and expenses of this program compare to other 529 plans that offer investment options very similar to my preferred investment option in this program?

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Notes: _______________________________________________________________________

Other issues:

What are the special creditor protections for this 529 plan under the laws of the sponsoring state?

Under Tennessee law, assets in a Tennessee or non-Tennessee 529 plan or other education savings plan are exempt from execution, attachment, garnishment, the operation of bankruptcy, the insolvency laws or other process whatsoever, and any assignment thereof shall not be enforceable in any court.

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Is this 529 plan linked into my favorite rewards service (e.g. Fidelity 529 College Rewards Card, Futuretrust, Upromise)?

Yes, the Upromise Rewards program can be linked to any 529 college savings plan. Upromise Rewards is free to join and offers members cash back for college.

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Will I have online access to my account for looking up my account values, etc?

Yes

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Who can I name as "payee" on distributions from this 529 plan? How easy is the process of requesting distributions?

The purchaser, beneficiary or the institution of higher education. Non-qualified withdrawals that are "refunds" or that are eligible for a waiver of the federal 10 percent penalty tax are payable to the purchaser.

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Notes: _______________________________________________________________________

Will this 529 plan accept my request to transfer the account owenership to someone else?

No provision for permitting an account owner change.

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How thorough and understandable are the program's official disclosure materials, and how much help is available through the programs web site, call center, etc.?

No provision for permitting an account owner change.

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Are there any other considerations unique to this program that can be considered advantages or disadvantages?

No provision for permitting an account owner change.

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Before investing, be sure to read and understand the official program materials provided on the 529 plan's website.

Click here to visit

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