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Ohio’s 529 Plan, CollegeAdvantage, offers investment options for a variety of savers. For more conservative investors or for savers whose child will be going to college soon and wants to invest in a cash preservation option, Ohio’s 529 Plan partnered with trusted banking leader, Fifth Third Bank to offer 529 saving accounts and 529 Certificate of Deposits (CDs). Fifth Third is a member of the Federal Deposit Insurance Corporation (FDIC).
Fifth Third Bank is encouraging people to save for their children’s future college costs by raising the rates on their 529 Savings Accounts. Fifth Third is also adjusting the rate on the 3-5 Month 529 CD. These new rates will take effect on Monday, Dec. 17, 2018. Put another way, any contributions to the investment options noted above that are received after 4 p.m. ET on Friday, Dec. 14 will receive these new rates.
Fifth Third 529 Saving Account rates are based on balance amount. For savings account balances under $5,000, the Annual Percentage Yield (APY) will raise to 0.25 percent. For balances from $5,001 – $10,000, the new rate will be 0.25 percent. For savings accounts with balances from $10,001 - $25,000, the rate will increase to 0.40 percent. For balances from $25,001 - $50,000, the rate will rise to 0.55 percent. For saving account balances from $50,001 - $100,000, the APY will be 0.70 percent. For account with balances over $100,000, the new rate will be 1.00 percent.
Additionally, the rate for the 3-5 Month 529 CD will be reduced to 1.50% APY.
The minimum contribution to open a Fifth Third 529 CD, at any term, is $500. You cannot purchase a CD with payroll deduction or automatic recurring contributions.
If you haven’t opened a CollegeAdvantage Direct 529 Plan, it’s simple to go online to open an account in minutes and open a Fifth Third Savings Account or purchase a Fifth Third 529 CD.
Current CollegeAdvantage Direct 529 Plan account owners can open a Fifth Third 529 savings account or purchase a CD online. Log in to your Direct Plan account. For savings accounts, set up the account and make your initial deposit. For CDs, make a one-time electronic contribution of $500 or more from your bank account to buy 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 or at any amount to open a savings account. You can also download an Additional Contribution Form and mail it with a check to fund the savings account or purchase a CD. When selecting to purchase a CD, choose what the term of maturity would best fit your family’s needs.
Two business days are required to complete the transaction to open a Fifth Third 529 Savings Account or 529 CD. Accordingly, it will receive the APY in effect on the business day following the receipt of a contribution, which is received in good order before 4 p.m. on any given business day.
Once the CD reaches the end of its term, the balance will automatically transfer to a Fifth Third 529 Savings Account. At this point, you can make a withdrawal, or exchange the funds to another Fifth Third 529 CD or any other Ohio 529 Plan investment option. You can also opt to leave the money in the savings account to earn interest. If the 529 CD is liquidated prior to its date of maturity, penalties will be assessed.
Federal regulations for qualified 529 programs limit the number of times account owners can reallocate investment options for the same beneficiary. Currently, the limit is two exchanges of assets per calendar year, per beneficiary. Please refer to the CollegeAdvantage Direct Plan Offering Statement and Participation Agreement for additional details.
Both the Fifth Third 529 Savings Account and the Fifth Third 529 CDs are FDIC-insured investment options to certain limits.
Open a Fifth Third 529 Savings Account with these higher interest rates or purchase a 529 CD to start saving for your child’s future higher education expenses today! A 529 account can be used for whatever comes after high school — whether vocational or trade programs, community or traditional four-year college or university programs. Ohio’s 529 Plan, CollegeAdvantage, has tools to help you determine how much to save for future college costs as well as age-based savings strategies. Remember, it’s cheaper to save for college now, earn interest in a 529 account and use those savings to pay for college versus paying for student loans with accumulated interest later.
Someday, your child is going off to college. Someday starts with Ohio’s 529 Plan, CollegeAdvantage.
Posted on December 11, 2018