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Beginning Aug. 17, 2017, Fifth Third Bank, an investment option partner with Ohio’s 529 Plan, will offer higher rates on two FDIC-insured 529 Certificates of Deposit (CDs): Those with terms of 6 - 11 months and those with terms of 12-23 months. The Annual Percentage Yield (APY) is now set at 1.00% for both CD terms. (Previously, the APY was set at 0.30% for the 6-11 Month CD and 0.50% for the 12-23 Month CD.)
CDs require a minimum $500 contribution and anyone — parents, grandparents, friends and other loved ones – can purchased a CD to help cover your child’s future college costs.
Current CollegeAdvantage Direct 529 Plan account owners can purchase a CD online. Log in to your Direct Plan account and make a one-time contribution electronically from your bank account to buy a CD. You can also download an Additional Contribution Form and mail it with your minimum contribution of $500 to purchase a CD. After logging in, you can also go to “Change Your Investment Options” section to exchange a current investment with a $500 minimum to buy a CD.
If you haven’t opened a Direct 529 Plan, it’s easy to enroll online and purchase a Fifth Third 529 CD at that time.
Once the CD reaches maturity, the balance will transfer to a Fifth Third 529 Savings Account. At this point, you can withdraw the funds, exchange the funds to another Fifth Third 529 CD or to other CollegeAdvantage investment options*, or leave the money in the savings account to earn interest. There are penalties assessed if the CD is liquidated prior to its date of maturity. Both the Fifth Third 529 Savings Account and the Fifth Third 529 CDs are FDIC-insured investment options.
Are you interested in getting this new CD interest rate? Go here to purchase your CD and start saving for your child’s future college expenses today! If you are wondering how much to save or the cost of waiting to save, visit here for tools to gain a better understanding on the power of investing.
* Federal regulations for qualified 529 programs limit the number of times account owners can reallocate investment options for the same beneficiary. The 529 account owner is allowed to make two exchanges of assets from one investment option to another per calendar year, per beneficiary. Please refer to the CollegeAdvantage Direct Plan Offering Statement and Participation Agreement for additional details.
Fifth Third Bank is a member of the FDIC.
Posted on October 26, 2017