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U.Fund College Investing Plan

4 / 5

Our rating

Good MA resident benefits

MA resident benefits

Massachusetts' U.Fund College Investing Plan, a Fidelity-managed 529 plan follows the same approach as other Fidelity plans in Arizona, Connecticut, Delaware and New Hampshire. It features three age-based options; one using Fidelity Series actively managed funds; one using Fidelity Series index funds; and a third using a combination of the two. The plan also offers 11 static options, and an option that invests in an interest-bearing deposit account.

U.Fund College Investing PlanHigh Honors

KEY METRICS

OVERVIEW

Program type

Savings

Inception

1999

State agency

Massachusetts Educational Financing Authority (MEFA)

Tax deduction

For single filers: $1,000/yr per beneficiary

For joint filers: $2,000/yr per beneficiary

Program manager

Fidelity Investments

Program distributor

Fidelity Brokerage Services, LLC

Manager contract term

MORE INFORMATION

Eligibility

State residency requirements:

None

Who can be a participant/owner in the program?

U.S. citizens and resident aliens at least 18 years old, UGMA/UTMA custodians, and trusts.

Significant time or age restrictions imposed by the program:

None

Contributions

Maximum contributions:

Accepts contributions until all account balances in Massachusetts' 529 plan for the same beneficiary reach $500,000.

Minimum contributions:

There is no minimum to open an account. With the automatic investment plan, the minimum contribution level is $15 per month or $45 per quarter.

Does the program offer an e-gifting platform for receiving gift contributions?

This plan offers an online tool to share a gift contribution link with family and friends.

SPONSORED

Other great plans to consider

You are not limited to your own state's 529 plan, so compare the plan and tax benefits offered by your state to other options. Here are some plans that are available to residents of any state and have earned awards in our 529 Plan Ratings:

Investment Options

Investors in U.Fund College Investing Plan can select from the following investment options. Click on a portfolio name for more information.

Choose between 3 age-based options, one invested in Fidelity Series actively managed funds, another invested in Fidelity Series index funds, and a Fidelity Blend option with a combination. Contributions are placed into the portfolio corresponding to the beneficiary's age. The portfolios automatically shift to a more conservative investment allocation over time.
PortfolioE.R. % Equity1yr performance
Fidelity Blend: Portfolio 20240.41%15%5.32%
Fidelity Blend: Portfolio 20270.44%26.47%5.43%
Fidelity Blend: Portfolio 20300.48%40.04%5.29%
Fidelity Blend: Portfolio 20330.51%52.78%5.23%
Fidelity Blend: Portfolio 20360.54%66.41%5.32%
Fidelity Blend: College Portfolio0.4%15%5.38%
Fidelity Blend: Portfolio 20390.56%79.64%5.44%
Fidelity Funds: MA Portfolio 20390.8%79.63%5.33%
Fidelity Index Fund: MA Portfolio 20390.14%79.63%6.55%
Fidelity Blend: Portfolio 20420.59%92.97%5.58%
Fidelity Funds: MA Portfolio 20420.83%92.95%5.39%
Fidelity Index Fund: MA Portfolio 20420.14%92.95%6.79%
Fidelity Funds: MA Portfolio 20240.61%15.01%5.19%
Fidelity Funds: MA Portfolio 20300.7%40.03%5.22%
Fidelity Funds: MA College Portfolio0.6%15.01%5.23%
Fidelity Index Fund: MA Portfolio 20240.14%15%5.51%
Fidelity Index Fund: MA Portfolio 20300.14%40.02%5.88%
Fidelity Index Fund: MA College Portfolio0.14%15%5.57%
Fidelity Funds: MA Portfolio 20270.64%26.48%5.29%
Fidelity Index Fund: MA Portfolio 20270.14%26.48%5.75%
Fidelity Funds: MA Portfolio 20330.74%52.77%5.17%
Fidelity Index Fund: MA Portfolio 20330.14%52.79%5.99%
Fidelity Index Fund: MA Portfolio 20360.14%66.39%6.27%
Fidelity Funds: MA Portfolio 20360.77%66.41%5.24%

Age-based/Enrollment Year investment options:

Choose between 3 age-based options, one invested in Fidelity Series actively managed funds, another invested in Fidelity Series index funds, and a Fidelity Blend option with a combination. Contributions are placed into the portfolio corresponding to the beneficiary's age. The portfolios automatically shift to a more conservative investment allocation over time.

Static investment options:

Select among 6 multi-fund portfolios, 5 individual-fund portfolios, and a Bank Deposit Portfolio and a Money Market portfolio.

Underlying investments:

Fidelity Investments. For the Bank Deposit Portfolio only, a deposit in a FDIC-insured interest-bearing account (Wells Fargo).

Underlying fund allocations:

Portfolio Fees & Performance Lookup

Fees & Expenses

Enrollment or application fee:

None.

Account maintenance fee:

None.

Program management fees:

0.09% for the index fund options (includes 0.045% state fee); 0.17% for the Fidelity fund options (includes 0.10% state fee); 0.12% for the Fidelity Blend fund options (includes 0.07% state fee). For the Bank Deposit Portfolio, there is a 0.10% Program Management Fee (includes 0.05% state fee) and is based on the Federal Funds Target Rate.

Expenses of the underlying investments:

Ranges from 0.01% to 0.05% annualized in the Fidelity index fund portfolios, from 0.30% to 1.05% annualized in the Fidelity funds portfolios, and 0.28% to 0.50% in the Fidelity Blend portfolios. For the Money Market 0.18% annualized in the Fidelity Funds. For the Bank Deposit Portfolio, there is no underlying fund expense. There is, however, a Bank Administration Fee, which ranges from 0.00%-0.40% and is based on the Federal Funds Target Rate.

Total asset-based expense ratio:

0.10% - 1.22%

Taxes and other Benefits

Tax deduction for single filers:

$1,000/yr per beneficiary

Tax deduction for joint filers:

$2,000/yr per beneficiary

Program match on contributions:

BabySteps MA (formerly known as SeedMA Baby) is an expansion of the SeedMA initiative started in 2016. Beginning in January 2020, every baby born to or adopted by a Massachusetts resident is eligible for a free $50 seed deposit into a U.Fund 529 college savings account.

State tax deduction or credit for contributions:

Effective January 1, 2017, contributions to Massachusetts 529 plans of up to $1,000 per year by an individual, and up to $2,000 per year by a married couple filing jointly, are deductible in computing Massachusetts taxable income.

Calculate your Massachusetts 529 tax benefit

Find out how much you can save on state taxes this year by contributing to a Massachusetts 529 plan.

Your tax savings per year
$0

Household income

$100,000

Monthly Contribution

$100

State tax recapture provisions:

A portion of withdrawals from this plan for a reason other than to pay qualified higher education expenses is included in Massachusetts taxable income to the extent of prior Massachusetts tax deductions, unless the withdrawal is due to the beneficiary's death, disability or receipt of a scholarship. It is unclear whether withdrawals for K-12 tuition, apprenticeship program expenses or qualified education loan payments are considered qualified higher education expenses for Massachusetts deduction recapture purposes.

State definition of qualified expenses

For purposes other than state tax deduction recapture, the state conforms with the federal definition of qualified higher education expenses, which includes expenses for higher education, apprenticeship programs, interest and/or principal on qualified education loans up to a $10,000 lifetime cap, and up to $10,000 per year in tuition in connection with enrollment or attendance at an elementary or secondary public, private, or religious school. It is unclear whether withdrawals for K-12 tuition, apprenticeship program expenses or qualified education loan payments are considered qualified higher education expenses for Massachusetts deduction recapture purposes. Rollover distributions from a 529 account to another 529 program, an ABLE account or a Roth IRA are not considered a qualified higher education expense for state tax deduction recapture purposes.

State tax treatment of qualified distributions:

Qualified distributions from Massachusetts and non-Massachusetts 529 plans are exempt.

State tax treatment of rollovers:

Massachusetts follows federal tax-free treatment for state income tax purposes other than state tax deduction recapture.

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

Is there a rewards program or outside scholarship program that works with this program?

Yes, Fidelity Rewards Visa Signature Card rebates 2% of purchases.

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.

Statutory protection of an account from creditors:

Distributions & Terminations

To whom are distributions made payable:

To whomever the account owner specifies - the account owner, the beneficiary, a school, or anyone else.

Account Changes

Policy regarding participant/owner changes:

Account ownership may not be transferred prior to the owner's death or incapacity.

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:

Contact

Website:

https://www.fidelity.com/529-plans/massachusetts

Telephone:

1-800-544-2776

Twitter

https://twitter.com/#!/MEFAtweets

A good place to start:

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