It’s Time to Save

Senator Ross Romeroby Senator Ross Romero
District 7

September is National College Savings Month, and I wanted to make sure all the parents and families of future college students know about the Utah Educational Savings Plan (UESP).  The importance of a college education cannot be overemphasized.

Did you know?

1.     College graduates age 25 and over earn nearly twice as much as workers who only have a high school diploma.

2.     Earnings from 529 plans are not taxed when used to pay for eligible college expenses.

3.     Utah taxpayers receive a 5% tax credit on contributions up to $1,650 per beneficiary, equaling $82.50.  If filing jointly, the 5% credit is applied to contributions up to $3,300 per beneficiary, equaling $165.  The UESP 529 account must be established before the beneficiary’s 19th birthday to qualify for the credit.

4.     No minimum investment is required to open or maintain a Utah Educational Savings Plan college savings account.

Did you know the UESP has been nationally recognized for its management?

“You will typically find the lowest costs among direct-sold 529s, such  as Utah’s Educational Savings Plan, with expenses of 0.38% or less.”

Money Magazine
August 2007

“The Utah Educational Savings Plan, which is run by the state, remains a top choice due to a diverse lineup of portfolios and low annual expenses, which mostly range from 0.25% to 0.38% across its portfolios.”

Wall Street Journal
March 1, 2007

While I have provided examples from UESP’s program, there are many other 529 plans which you may want to consider.  I personally have opened a UESP account for my son.  I know how much my university experience and education have meant for me (including meeting my wife), and I wanted to make sure he also has those same opportunities.

If you would like more information about saving for college, please review www.collegesavings.org/didYouKnows.aspx.

If you would like more information about USEP or would like to open an account, please visit www.uesp.org.

2 thoughts on “It’s Time to Save

  1. USEP is touted as a low cost 529. Not. There are fund fees, administrative fees, and worse if you divide your contributions into different investment options each of these options is hit with fees.

  2. Dear Mr. Waddswoth:

    UESP stands by its low fee moniker.

    Two fees are charged on a quarterly basis. (1) The annual maintenance fee tops out at $15/year. It is waived for Utah residents. (2) The UESP administrative asset fee is .22%. This is less than one quarter of one percent. Most other 529 plans charge twice as much or more.

    Vanguard is also known for its low fees. For example, the S&P 500 Index fund fees are .025% which are netted against the value of the shares. For purposes of full disclosure, the fund fees are added to the UESP admin fee as you see in the magazine quotes above.

    In the name of transparency, UESP’s quarterly statements show the UESP fees applied to each of your underlying investments, making it look like there are multiple fees. A 401(k) statement would total all such fees into one amount.

    Please call us at 1.800.418.2551. We would be happy to review your account with you.

    Sincerely,
    Lynne Ward
    UESP Director

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