Back To Blog
Beginning Thursday, Jan. 11, 2018,Fifth Third Bank, an investment option partner with Ohio’s 529 Plan, is increasing the rates on four different terms of 529 Certificates of Deposit (CDs).
The rate for the 12-23 Month 529 CD will increase from 1.00% Annual Percentage Yield (APY) to 1.25% APY, and the 24 - 35 Month 529 CD will increase from 1.45% Annual Percentage Yield (APY) to 1.55% APY. The APY for the 36 – 47 Month CD will rise to 1.65%. The increased rate for the 48-59 Month CD is now 1.75%.
These new APY are higher than the 2017-2018 tuition inflation rate of 0.6% for Ohio’s thirteen public universities. In August, Fifth Third also increased the rates on 529 CDS with terms of 6 - 11 months. Therefore, if your student is looking ahead to college and you want to be more conservative in your 529 saving plan, you have options. The minimum contribution to add a CD to your 529 investments is $500. Current CollegeAdvantage Direct 529 Plan account owners can purchase a CD online. Log in to your Direct Plan account and make a one-time electronic contribution from your bank account to buy a CD. You can also download an Additional Contribution Form and mail it with a check 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.
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. If the CD is liquidated prior to its date of maturity, there are penalties assessed. Both the Fifth Third 529 Savings Account and the Fifth Third 529 CDs are FDIC-insured investment options.
Go here to purchase a CD with these higher interest rates and start saving for your child’s future college expenses today! If you haven’t opened a CollegeAdvantage Direct 529 Plan, it’s easy to enroll online and purchase a Fifth Third 529 CD at that time. Ohio’s 529 Plan, CollegeAdvantage, has tools to help you determine how much to save for future college costs as well as to see the cost of waiting to save.
* 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 January 11, 2018