Planning for college - Top 529 Myths.jpg

Myth: Money in an Arkansas 529 GIFT Plan account can only be used at schools in Arkansas.
Truth: You can use the assets in your Arkansas 529 GIFT Plan account at any eligible 2- and 4-year college, graduate school (including law and medical), and vocational/technical school.1

Myth: You can only use a 529 plan account to pay for college tuition.
Truth: You can use your Arkansas 529 GIFT Plan account assets for many qualified higher education expenses, including tuition, fees, and certain room and board costs.2

Myth: It costs a lot to open and maintain a 529 plan account.
Truth: Open an Arkansas 529 GIFT Plan account with as little as $10 a month (or $30 per quarter) with recurring contributions (an automatic investment plan)3 or a one-time contribution of $25. You can also set up payroll direct deposit with a $5 minimum per pay period.3

Myth: You have to make a lot of investment decisions.
Truth: With the Arkansas 529 GIFT Plan, you can be as hands-on or hands-off as you want to be. You can choose from a lower-risk, FDIC-insured GIFT Plan Savings Portfolio; Age-Based Portfolios that automatically adjusts its investments as your child nears college; or Custom Portfolios that help you match your goals and risk tolerance to the appropriate investment mix.

Myth: It's too late to start a 529 plan account.
Truth: Even if your student is already in high school, you can benefit from a 529 plan. Earnings grow federal tax-deferred, and when you withdraw the money for a qualified higher education expense, it's federal tax free.2 Any assets not used may even be rolled over to another eligible family member.

Myth: If your child doesn’t go to college, you lose your money.
Truth: The 529 plan account owner controls the account. So you can change your beneficiary to another eligible "member of the family" (as per IRS rules) with no tax penalty.

Myth: It's difficult to open a 529 plan account.
Truth: It's fast and easy to enroll online.

Myth: It's expensive to save for college.
Truth: With the Arkansas GIFT 529 Plan, it's easy and affordable. Total annual asset-based Arkansas 529 GIFT Plan fees are 0.57% (0.55% for the GIFT Plan Savings Portfolio). For example, if you invest $1,000, the annual fee would be just $5.70 ($5.50 for the GIFT Plan Savings Portfolio). All non-resident accounts are charged an annual account fee of $20; that fee is waived if the designated beneficiary or account owner is a resident of Arkansas.

1An eligible institution is one that can participate in federal financial aid programs.

2Earnings on non-qualified withdrawals are subject to federal income tax and may be subject to a 10% federal penalty tax, as well as state and local income taxes. The availability of tax or other benefits may be contingent on meeting other requirements.

3A plan of periodic investment does not assure a profit or protect against a loss in declining markets.

Ascensus Broker Dealer Services is the distributor of The Arkansas 529 GIFT Plan, Learn more about Ascensus Broker Dealer Services, Inc. on FINRA's BrokerCheck FINRA's BrokerCheck.

For more information about the GIFT College Investing Plan (the "GIFT Plan"), call 1.800.587.7301 or visit www.thegiftplan.com to obtain a Program Description and Participation Agreement, which includes investment objectives, risks, charges, expenses and other information; read and consider it carefully before making an investment or sending money. Ascensus Broker Dealer Services, Inc. ("ABD") is the Distributor of the GIFT Plan.

Please Note: Before investing in any 529 plan, you should consider whether your or the beneficiary's home state offers a 529 plan that provides its taxpayers with state tax or other benefits that are only available through investment in the home state's 529 plan. You should consult your financial, tax, or other advisor to learn more about how state-based benefits (or any limitations) would apply to your specific circumstances. You also may wish to contact directly your home state's 529 college savings plan(s), or any other 529 plan, to learn more about those plans' features, benefits, and limitations. Keep in mind that state-based benefits should be one of many appropriately weighted factors to be considered when making an investment decision.

The GIFT Plan is a college tuition savings program sponsored by the State of Arkansas and administered by the Arkansas Section 529 Plan Review Committee ("Committee"). ABD, the Program Manager, and its affiliates have overall responsibility for the day-to-day operations, including investment advisory services, recordkeeping, administrative services and marketing of the GIFT Plan. The GIFT Plan's Portfolios invest in: (i) mutual funds; or (ii) an FDIC-insured omnibus savings account held in trust by the Committee at Sallie Mae Bank. Except for the GIFT Plan Savings Portfolio, investments in the GIFT Plan are not insured by the FDIC. Units of the Portfolios are municipal securities and the value of units will vary with market conditions.

Investment returns will vary depending upon the performance of the GIFT Plan Portfolios you choose. Except to the extent of FDIC insurance available for the GIFT Plan Savings Portfolio, you could lose all or a portion of your money by investing in the GIFT Plan, depending on market conditions. Account Owners assume all investment risks as well as responsibility for any federal and state tax consequences.

Not FDIC-Insured (except for the GIFT Plan Savings Portfolio). No Bank, State or Federal Guarantee. May Lose Value.