How To Prepare For Your Guaranteed 529 Plan Withdrawal
As your child prepares to head off to college at the end of the summer, take time now to prepare their CollegeAdvantage Guaranteed 529 Plan to simplify the withdrawal process when the bills for their qualified higher education expenses come in.
Update account and banking information
One of the first steps you will want to take is to verify that your home address and bank account information are correct on your account. If it’s not, update that information now. For security reasons, this information must be on file at Ohio’s 529 Plan, CollegeAdvantage, for 15 calendar days before a withdrawal can be processed. To update your account online, log in and revise the information in it to match your current records.
If you need help logging into your account, please call our Customer Service Department from 8:30 a.m. – 6 p.m. ET Monday-Friday at 1-800-AFFORD-IT (1-800-233-6734) or email CustomerService@CollegeAdvantage.com.
2019-2020 WAT Rate
Before you start the withdrawal process, you will want to know the new Weighted Average Tuition (WAT) payout rate for the 2019-2020 school year. Effective July 31, 2019, the payout rates** for the CollegeAdvantage Guaranteed 529 Savings Plan are:
Tuition Unit: $108.55
Tuition Credit: $124.83
Please use these numbers to figure out the withdrawal amount to pay for your child’s higher education. You will also want to verify your account balance before requesting a withdrawal.
If there are qualified higher education expenses you would like to cover in 2019, please make your withdrawal payment soon. These funds should be used for qualified expenses incurred in the same year. As the account owner, you are responsible to maintain the records showing that the Guaranteed 529 withdrawals are used for qualified education expenses for tax records within the calendar year of the withdrawal.
Online withdrawal and online payment
The quickest way to withdrawal funds from your Guaranteed 529 Plan is set up a withdrawal online while you are logged into your account.
You will have three options on where to send the funds: to the school, to your bank account or check sent to you, or to your beneficiary’s bank account or a check sent to the beneficiary. Withdrawals requested before 4 p.m. ET Monday-Friday will be processed in three to five business days. If you choose for the withdrawal to be deposited into a bank account, it will be sent electronically. You will need to take into account some additional time for your banking institute to show that the funds have been deposited.
If you are electing to have the withdrawal sent directly to the school, your child must be enrolled at the school to use online bill pay. If she or he is not on the roster, the 529 withdrawal will be returned to CollegeAdvantage. You will also need the name of the school, your child’s school-issued student ID number, the academic year and term, and the amount you’d like to withdrawal from your account.
After choosing to make a withdrawal from your child’s account, you will next need to select the school at which your child attends then add your child’s school-issued student ID. Based on the higher education institution’s preference, the school will either receive an electronic payment from CollegeAdvantage or they will receive a check from CollegeAdvantage. If the school opts for the check, it will be mailed to the institution within three to five business days. Please allow for extra time for the United States Postal Service to deliver the check.
Once you’ve added you child’s student ID number, you will enter the dollar amount you’d like to withdraw from the Guarantee 529 account. You will have a chance to review all the information you’ve input, then submit your withdrawal request.
The second quickest payment method is to have the 529 withdrawal deposited into your or your beneficiary’s bank account. Once the funds are in the account, go through the school’s online portal to pay for the qualified higher education expenses. Again, make sure you have the correct student ID number. Processing times will vary by school; ask the bursar’s or financial aid office what a good time would be to start the withdrawal process so to avoid late penalties.
Online withdrawal and paper check delivery
If you’ve opted to have the 529 withdrawal sent to your bank account or check sent to you, or to your beneficiary’s bank account or a check sent to the beneficiary, you will then need to mail your personal check to the school to cover your child’s qualified costs. If you have elected to have your withdrawal sent as a check, allow for some additional time to complete this process due to the United States Postal Service’s delivery schedule and the school’s processing procedures.
When making the withdrawal, you must provide the correct school address to where the check should be sent as well as the beneficiary’s name and school ID number. CollegeAdvantage does not provide school addresses.
Paper withdrawal form and paper check delivery
You can also make your request by printing out the paper Withdrawal Request Form and make it payable to you, your beneficiary, or the school. You can fill out the form online then print it. Once completed, mail it to the address listed on the form and then have the withdrawal mailed to you or the school. This form, as well as other forms for the CollegeAdvantage Guaranteed 529 Savings Plan, can be found here.
If you fill out a paper form for a withdrawal of $10,000 or more, the form must be notarized.
Please note that this is the slowest withdrawal and payment method. Mail delivery — to bank accounts and/or to the school — will increase the processing times at each one of these institutions. Therefore, check with the school’s bursar office to find out how long they need to process a mailed check so you can avoid late penalties.
Pre-1996 account information
For pre-1996 accounts, online withdrawals can only be made to the school. The beneficiary is considered the controller of the pre-1996 account once they turn 18. If they, as the controller, choose to fill out a paper Withdrawal Request Form, the withdrawal can be issued to themselves, you as the account owner, or to the eligible education institution. The controller/beneficiary has to sign the withdrawal request form along with you as the account owner and your beneficiary’s signature must be notarized. In order to change this process, you as the account owner and your beneficiary must fill out and sign the pre-1996 Ownership Amendment Form contract. Then you, as the account owner, can continue to make withdraws without requiring your beneficiary’s signature.
These simple steps will streamline the withdrawal process so you can pay your child’s college costs on time. If you have any additional questions, our Customer Service Department is available to help from 8:30 a.m. – 6 p.m. ET Monday-Friday at 1-800-AFFORD-IT (1-800-233-6734) or at CustomerService@CollegeAdvantage.com.
* This college savings plan has been closed to new enrollments and new investments since Dec. 31, 2003.
** Withdrawal values are calculated according to Ohio Administrative Code and may change at any time and without notice.
According to the 2016 Plan Description for the CollegeAdvantage Guaranteed 529 Savings Plan, WAT is “calculated as follows: 1. Multiply the annual in-state undergraduate tuition for the academic year at each of the Four-Year State Universities times the number of undergraduate full-time equivalent students at each such university; 2. Add together the products derived from (1) above; and 3. Divide the total of these products by the total number of undergraduate full-time equivalent students attending Four-Year State Universities.”
The Four-Year State Universities, listed in the Ohio Revised Code Section 3345.011, include University of Akron, Bowling Green State University, Central State University, University of Cincinnati, Cleveland State University, Kent State University, Miami University, Ohio University, Ohio State University, Shawnee State University, University of Toledo, Wright State University, and Youngstown State University.
Posted on July 31, 2019