CollegeBoundfund® Lowers Investment Fees and Creates New Incentives for Rhode Islanders Every Rhode Island Baby Eligible for a $100 Starter Account
June 1, 2010 (PROVIDENCE, RI) – General Treasurer Frank T. Caprio, together with the Rhode Island Higher Education Assistance Authority (RIHEAA) Executive Director, William H. Hurry, announced today that Rhode Island’s CollegeBoundfund® will now offer Rhode Island residents the lowest cost age-based and index investment options available to Rhode Islanders from any 529 college savings plan across the nation.
“The slashing of costs for current and future CollegeBoundfund® investors means that more of the hard-earned money of Rhode Island families will grow in their children’s CollegeBoundfund® accounts,” said General Treasurer Frank T. Caprio. “A dollar saved in investment fees is a dollar invested in a child’s future,” he added. The fee reductions are expected to result in an average savings of $1,200 over the life of a 15-year $10,000 average CollegeBoundfund® investment.
For Rhode Island residents, the program management expenses on all age-based portfolios within CollegeBoundfund® have been lowered to 0.20%. This equates to an average expense reduction of 75%.
“The sizeable reduction of CollegeBoundfund® program management fees is a great incentive for Rhode Island families to save early and often for the higher education of their children,” said RIHEAA Executive Director William H. Hurry. “Knowing that CollegeBoundfund® is now available to Rhode Islanders at an even lower cost will hopefully encourage even more families to participate.”
New Incentives Created for Rhode Island Babies
In an unprecedented investment in the future of the State, CollegeBoundfund® will launch a new program so that every baby born or adopted in Rhode Island after July 1, 2010 will be eligible to receive a $100 contribution to a CollegeBoundfund® account set up in their name. The program will enable families to begin saving for college during the very first year of a child’s life, allowing them more time to grow their college savings.
“We are proud to now provide each and every child born in Rhode Island with a head start in life,” said Caprio. “The establishment of a college savings account today provides children with the hope of a college education in the future. We hope to inspire many families to save for their children’s education,” he added.
These CollegeBoundfund® enhancements are part of the State’s ongoing commitment to invest in Rhode Island families and to provide them with valuable resources needed to achieve brighter financial futures. These enhancements coincide with the State’s renewal of the CollegeBoundfund® management agreement with AllianceBernstein, L.P. As of April 30, 2010, Rhode Island residents had over 22,000 accounts totaling more than $248 million in the CollegeBoundfund® program.
CollegeBoundfund®, a Section 529 qualified tuition program, can be used at accredited colleges, universities, vocational schools and trade schools across the nation and offers a simple way to save and invest for a child’s higher education. For more information, please visit www.collegeboundfund.com/ri or call (888) 324-5057.
About the Rhode Island Office of General Treasurer: The Office of General Treasurer’s mission is to protect the State’s assets through sound financial investments, to strengthen the State’s financial position, to assist families in investing funds for their children’s higher education and to ensure Rhode Islanders receive superior service through all the programs he manages. For more information, visit www.treasury.ri.gov.
About Rhode Island Higher Education Assistance Authority The Rhode Island Higher Education Assistance Authority (RIHEAA) is responsible for the administration of CollegeBoundfund®, Rhode Island’s 529 college savings plan in which nearly 500,000 participants have invested more than $7.5 billion. RIHEAA also administers the RI State Grant and Scholarship Program and WaytogoRI.org, a free career and college planning resource being used in every school district in the state. RIHEAA is also the state’s designated guarantor for the Federal Family Education Loan Program. Since 1977, RIHEAA has guaranteed over $2 billion in student loans to over 300,000 borrowers. For more information, visit www.riheaa.org.