Changes to Minnesota College Savings Plan

By KBJR News 1

August 13, 2014 Updated Aug 13, 2014 at 10:07 PM CDT

Duluth, MN (NNCNOW.com) --- Major changes to Minnesota's College Savings Plan are now in effect.

Families can open a College Savings Plan for their children starting with $25.

All earnings in the plan's investment grow tax free as long as the funds are used for higher education.

Now, the investment lineup has been expanded from 7 options to 11.

A change in an existing managed option called the "age-based option," now protects against market swings.

"You just put the age of your beneficiary in and then we adjust the portfolio over time,” Robert Stern, Program Manager said. “So, the older that the beneficiary gets the less risk you are taking so there isn't some big drop a year before they are going to go to college."

Stern says the state's 529 college savings plan is now among the top five plans in the nation with the lowest fees.

That's because the managing company has reduced its management fee by over 50 percent.

Jennifer Walch
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