PROVIDENCE, RI -- General Treasurer Seth Magaziner today announced the successful launch of the improved CollegeBound program, Rhode Island's 529 college savings plan. The strengthened 529 college savings plan features lower fees, a wider array of investment options and improved customer service for the more than 18,000 Rhode Islanders with CollegeBound accounts.
"With these new improvements to CollegeBound, Rhode Island is poised to become even more competitive as a national leader helping to make college more affordable for Rhode Islanders and all Americans," Treasurer Magaziner said. "Higher education should not be accessible only to those with financial wealth. All children deserve access to higher education."
CollegeBound account holders both in Rhode Island and in other states will now benefit from a significantly reduced cost structure, which places CollegeBound among the lowest-cost 529 plans in the nation.
To make it easier for Rhode Islanders to open a college savings account, CollegeBound now has a Rhode Island-focused website and local customer service and marketing teams with offices in Warwick.
Financial professionals across the nation will also be able to navigate Rhode Island's advisor-sold 529 offerings with the help of a separate website and marketing team.
The new CollegeBound offers an expanded array of investment options that give participants the ability to customize their investment portfolios. Included among the new investment options, CollegeBound now offers a socially responsible investment strategy that eliminates exposure to fossil fuels and reduces exposure to investments in companies that produce tobacco, firearms and other products that cause social concern while seeking to produce competitive returns. Plan participants will also have the choice to remain in traditional investment products.
CollegeBound was launched in 1998 to help Rhode Islanders affordably save for college. The plan is open to residents in all 50 states and is among the largest 529 programs in the nation.
Investments and earnings growth can be used at accredited colleges, universities, vocational school and trade schools across the nation and offer a simple way to save and invest for a child's college education. Assets invested in the plan grow tax-free, and withdrawals for qualified higher education expenses are also federal income-tax free.
Rhode Island residents who open a CollegeBound Saver account can receive an annual state income tax deduction of up to $500 per individual and $1,000 per couple on funds contributed to the plan.
In late 2015, Treasurer Magaziner announced the conclusion of a highly competitive process to select a new manager of the CollegeBound program. Acensus College Savings and Invesco were selected as co-managers, and the improvements to the system announced today are a product of the collaboration between Rhode Island Treasury and these two new managers.
To learn more about CollegeBound please visit www.collegeboundsaver.com or call (877) 517-4829.