PROVIDENCE – The Rhode Island 529 education savings plan, CollegeBound Saver, was rated as one of the best 529 education savings plans in the country by savingforcollege.com, the R.I. Office of the General Treasurer announced Monday.
Both of the state’s direct-to-consumer and adviser plans were rated 5 out of 5 for in-state participants this year. The site describes a “five cap” rating as, “a program that offers outstanding flexibility, attractive investments and additional economic benefits (such as generous state tax incentives) that for some people, at least, will provide a substantial boost to their savings,” adding that, “there are few, if any, weaknesses noted in the program.”
The site ranked programs on performance, costs, features, reliability and resident benefits.
Both the direct-sold and the adviser-sold 529 plans in Rhode Island ranked less well for out-of-state participants.
The direct-sold non-resident offering was given a score of 4.5 out of 5, while the adviser program was given a 4 out of 5 rating.
The Ocean State’s direct-sold plans were one of 12 among the 50 states and the District of Columbia that received a 5 out of 5 rating. At the same time, Rhode Island’s adviser-sold plans were one of six government given top marks.
“The cost of college is out of control, and too many Rhode Islanders are having to take on student loan debt that they will be paying off for decades,” stated General Treasurer Seth Magaziner, whose office administers CollegeBound Saver. “Our office made Rhode Island’s 529 program easy and affordable for Rhode Island residents, and it’s great to see it recognized as one of the best 529 plans in the country.”
The state’s 529 program previously had received poor marks from other independent reviewers. Magaziner touted his changes to the program, citing a lower fee structure, an “improved menu of investment options and a new program manager,” which was listed as Ascensus College Savings.
Saving for College also noted that both the direct-sold and adviser programs were “substantially changed in 2016.”
The direct-sold program does not have a management fee for Rhode Island residents, but does have a 0.25 percent management fee for non-residents.
The program also allows state tax deductions of up to $500 per year for a single filer or $1,000 for jointly filing taxpayers.
The adviser 529 offering has a range of fees.