Ascensus College Savings Publishes 2016 529 Plan Trends Report

Data from nation’s #1 program manager suggests families use 529 plans
to save steadily over time

NEWTON, Mass.–(BUSINESS WIRE)–Ascensus
College Savings
, one of the nation’s largest administrators of 529
plans, celebrates 529 College Savings Day® with the release
of its Inside
529: The 2016 Ascensus College Savings Plan Report
.

Ascensus College Savings currently administers over 3.5 million 529 plan
accounts, representing more than 27 percent of the total 529 accounts
administered across the nation. The company provides services for 31
plans across 17 states and ranks as the #1 529 program manager in the
nation.1

As one of the largest recordkeepers in the industry, Ascensus College
Savings is in a unique position to shed light on how families are using
529s to save for post-secondary education. In 2015, Ascensus College
Savings processed over 18 million individual contributions to and nearly
800,000 qualified withdrawals from 529 accounts. When analyzing year-end
data across its platform, Ascensus College Savings identified the
following trends:

  • The average balance across all accounts was $20,070.
  • In 2012, there were over $21 million in Ugift®
    contributions made to Ascensus College Savings 529 accounts. In 2015,
    this amount increased by 299 percent to over $87 million in Ugift
    contributions.
  • Over 75 percent of individual contributions made in 2015 were $200 or
    less.
  • Sixty-one percent of accounts had total annual contributions of $2,000
    or less.
  • Seventy percent of withdrawals from 529 accounts that account owners
    identified as qualified were for $5,000 or less.

The report’s findings suggest that 529s are predominantly used to save
steadily during a beneficiary’s childhood. By making strategic and
modest withdrawals over the course of a student’s education, 529 savers
appear to be lessening their reliance on loans which could otherwise put
both parents and students in debt post-college.

“Saving for higher education doesn’t have to mean saving to cover all of
tuition and related expenses,” states Jeff Howkins, president of
Ascensus College Savings. “Each dollar saved in a 529 plan is a dollar
that doesn’t need to be paid back with interest in the future, and our
data shows that more families are embracing this concept. When it comes
time to finance a child’s four-year college, community college, or trade
school education, 529 funds can make a meaningful impact for those who
have the foresight to save.”

By using 529 plans, families and individuals can save for the increasing
cost of higher education at eligible schools nationwide, including
four-year universities, community colleges, and vocational schools (most
accredited schools are eligible). The benefits of 529 plans include a
range of investment options, account owner control of the account, tax
advantages for qualified withdrawals,2 flexibility to change
beneficiaries, and much more. For more information on 529 plans, please
visit www.AscensusCollegeSavings.com.

About Ascensus

Ascensus
is the largest independent retirement and college savings services
provider in the United States, helping over 6 million Americans save for
the future. With more than 35 years of experience, the firm partners
with financial institutions to offer tailored solutions that meet the
needs of financial professionals, employers, and individuals. Ascensus
specializes in recordkeeping, administrative, and program management
services, supporting over 40,000 retirement plans and over 3.5 million
529 college savings accounts. It also administers more than 1.5 million
IRAs and health savings accounts and is home to one of the largest ERISA
consulting teams in the country. For more information about Ascensus,
visit www.ascensus.com.

View career opportunities at careers.ascensus.com or on LinkedIn at linkedin.com/company/ascensus.
For the latest company news, follow @AscensusInc
on Twitter.

1 According to Strategic Insight’s 529 College Savings
Quarterly Data Update for the first quarter of 2016, Ascensus College
Savings ranked #1 529 program manager in the U.S. for assets under
management.

2 Earnings on nonqualified withdrawals are subject to federal
income tax and may be subject to a 10 percent federal penalty tax, as
well as state and local income taxes. The availability of tax or other
benefits may be contingent upon meeting certain requirements.

For more information about 529 plans managed or administered by Ascensus
College Savings call 1-877-529-2980 or visit www.AscensusCollegeSavings.com.

Before investing in any 529 plan, you should consider whether your or
the designated beneficiary’s home state offers a 529 plan that provides
its taxpayers with state tax and other benefits that are only available
through the home state’s 529 plan. You also should consult your
financial, tax, or other advisor to learn more about how state-based
benefits (or any limitations) would apply to your specific
circumstances. You also may wish to contact directly your home state’s
529 plan(s), or any other 529 plan, to learn more about those plans’
features, benefits and limitations. Keep in mind that state-based
benefits should be one of many appropriately weighted factors to be
considered when making an investment decision.

Investment objectives, risks, charges, expenses, and other important
information such as specific benefits, limitations, rules and guidance
are included in a 529 plan’s offering statement; read and consider it
carefully before investing.

When you invest in a 529 plan you are purchasing municipal securities
whose value will vary with market conditions. Investment returns will
vary depending upon the performance of the portfolios in the 529 plan
you choose. Depending on market conditions, you could lose all or a
portion of your money by investing in a 529 plan. Account owners assume
all investment risks as well as responsibility for any federal and state
tax consequences. Carefully read any disclosure statements and detailed
information relative to your investment goals or needs, or consult with
a tax advisor for their specific tax applications or consequences.

Contacts

Ascensus
Roberta Hess
Vice President
Marketing &
Communications
215-648-1426
Roberta.Hess@ascensus.com