As the Michigan Education Savings Program (MESP) continues to grade high on rankings of the best college savings programs in the country, the Michigan Department of Treasury is also hoping to see MESP's name pop up elsewhere: on holiday gift lifts.
MESP which was recently named one of the best 529 college savings programs in the country by both SavingForCollege.com and Morningstar Inc. makes contributing to an account easy for family and friends through its e-gifting program.
"We're proud of the national recognition MESP continues to receive from independent investment research sources, and we're also proud to make it as easy as possible for people to provide a gift that can literally last a lifetime," said Robin Lott, MESP administrator for the Michigan Department of Treasury.
The Michigan Department of Treasury is promoting the idea that providing cash toward a college savings plan such as MESP or the Michigan Education Trust can make more of an impact in a child's life than the latest trendy toy.
"A contribution to a college education fund will continue to make a difference in a child's life long after he or she wears out a toy," Lott said. "If you buy just a small gift plus add money to a college savings account, you're actually providing the best of both worlds."
MESP's e-gifting program allows account holders such as parents to send a tactful, prewritten email inviting grandparents, aunts, uncles and other gift givers to contribute to a child's existing MESP college savings fund.
The email contains a link that, when clicked on, takes the family member or friend to a secure web page, where he or she can make a gift of $25 or more to an existing MESP account by making an electronic transfer from a bank account.
The e-gifting program conveniently enables family and friends to make contributions without having to know or enter the number of the account or the investment option to which they're contributing.
Lott notes that, if preferred, family and friends can also send a check or money order (with the account number and investment option they're contributing to clearly indicated) or even open their own MESP account for a child.
Contributions to an MESP account may also qualify for estate and gift tax benefits, as well as state of Michigan income tax deductions. Those making contributions should consult a tax adviser for details.
And as an added bonus, gift givers will know they are contributing toward a college savings plan deemed one of the best in the nation by independent evaluators.
SavingForCollege.com, which describes itself as an unbiased source of information on 529 college savings plans, ranked MESP's investment performance as sixth best in the nation during the 12 months ended Sept. 30. MESP also ranked fifth for three-year performance, ninth for five-year performance and seventh for 10-year performance in the SavingForCollege.com listing.
MESP, managed by TIAA-CREF Tuition Financing Inc. on behalf of the Michigan Department of Treasury, also was once again a top performer in Morningstar Inc.'s annual ratings of 529 college-savings plans, retaining its "Silver" rating for the fifth consecutive year.
Of the 63 plans the independent investment research firm analyzed nationwide, MESP was one of only 13 to earn a Gold or Silver rating. Morningstar judges those plans as most likely to outperform their peers on a risk-adjusted basis over the long haul.
Morningstar says that it rates college-savings plans based on five key pillars:
- Process: Did the plan hire an experienced asset allocator to design a thoughtful, well-diversified glide path for the age-based portfolios? What suite of investment options is offered?
- People: What is Morningstar's assessment of the underlying money managers' talent, tenure, and resources?
- Parent: Is the program manager a good caretaker of college savers' capital? Is the state managing the plan professionally?
- Performance: Have the plan's options earned their keep with solid risk-adjusted returns over relevant time periods? How is the plan expected to perform going forward?
- Price: Are the investment options a good value?
The firm also takes into consideration any unique benefits that plans offer to college savers, including local tax breaks, grants and scholarships.
To learn more about MESP, visit MIsaves.com.
Published: Mon, Dec 19, 2016
