1 / 15

Michigan’s Section 529 Qualified Tuition Programs

Michigan’s Section 529 Qualified Tuition Programs. TIAA-CREF, TFI selected as manager of college savings programs in: California, Connecticut, Idaho, Kentucky, Michigan, Minnesota, Missouri, Mississippi, Oklahoma, Tennessee, Vermont, Georgia

ayita
Download Presentation

Michigan’s Section 529 Qualified Tuition Programs

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Michigan’s Section 529 Qualified Tuition Programs

  2. TIAA-CREF, TFI selected as manager of college savings programs in: California, Connecticut, Idaho, Kentucky, Michigan, Minnesota, Missouri, Mississippi, Oklahoma, Tennessee, Vermont, Georgia • Total account balance can be used for qualified higher education expenses at any eligible higher education institution in the nation or abroad

  3. MESP Benefits • Minimal Contribution Amount $25 • Maximum Contributions $235,000 • State Income Tax Deduction • Tax Exempt Earnings until 2010 • Federal Gift Tax Exemption • Low Fee Program • Three Investment Options • Matching Grant

  4. Investment Options • Core Option • Managed Allocation - Age Based • Supplemental Options • Guaranteed • 100% Equity • IRC Sec. 529 Regulation - Account owner does not control how the savings are invested - can change once per calendar year • Contributions gain or lose value based on performance of mutual funds • No residency requirements

  5. Matching Grant Matching grant • The State will match $1 for every $3 contributed • Maximum $200 per beneficiary • Requirements -- when the MESP account is opened • Beneficiary must be 6 years old or under • Beneficiary must reside in Michigan • Household income of the beneficiary’s custodial parent(s) must be $80,000 (AGI) or less • Available only the 1st year the beneficiary is enrolled in the program • State ultimately determines who is eligible • Proceeds are invested in the TIAA-CREF Institutional Bond Fund • For tuition only

  6. Funding for Match • Funding is appropriated annually by the Legislature: • 2000-01 - $10 million • 2001-02 - $1 million • 2002-03 - $1 million • 2003-04 - $1 million • 2004-05 - proposed $900,000

  7. Marketing the Match • Program Brochure • Enrollment Kit • MESP Web Site • Presentations

  8. Financial Overview • As of October 31, 2003: • Total Accounts - 97,031 • Assets - $479.5 million • Match Accounts - 12,608 • Avg. Account Eligible for Match - $1,770 • Match Funds - $2.3 million • Avg. State Match Account - $184

  9. SEED/IDA Partnership • April 2003 - Meeting with State Treasurer • May 2003 - Letter of Support for SEED Proposal • July 2003 - SEED Grant Awarded • Aug. to Oct. - Experimental Design Evaluation Discussions • Nov. to April - Program Planning • Expectations, Roles & Responsibilities • Fall 2004 - Expected Implementation

  10. SEED/IDA Partnership • 500 Children will be enrolled • Initial $800 deposit in each SEED Account • Child’s family has 4 years to save additional $1,200 to be matched 1:1 by SEED • SEED accounts will be placed in MESP as required by the experimental initiative • Eligible for State Match

  11. SEED Initiative • Implementation will begin with 3 & 4 year olds enrolled in the Head Start Program • Currently 1,745 children & families enrolled in Head Start • Federal Poverty level $18,100 for family of four

  12. SEED Demographic • More than 70% families are employed • 36% are two parent families • 64% single parent families • 35% African American • 8% Latino • 54% Caucasian • Balance Native American, Asian and Multi-Ethnic

  13. Issues To Be Decided • Administrative • What is the financial aid impact? • Impact on eligibility for other means-tested programs

  14. QUESTIONS? • Robin McMillan, MET & MESP • mcmillanr@michigan.gov • (517) 335-4767 • Don Jones, Oakland Livingstone Human Service Agency (OLHSA) • donj@olhsa.org • (248) 209-2620 • Eric Muschler, Michigan IDA Partnership • muschler@earthlink.net • (734) 542-3951

More Related