CHET Advisor 529 Plan | Fidelity Institutional (2022)

CHET Advisor 529 Plan | Fidelity Institutional (1)

Give the financial freedom to pursue a higher education

Families want to enable their children to reach their highest potential. With an investment in education their dreams can be realized.

The Tax Advantages of the CHET Advisor 529 Plan

State residents may deduct up to $5,000 of taxable income annually from Connecticut state income taxes ($10,000 for joint filers). Contributions made up until April 15 of a given year qualify for a Connecticut state income tax deduction for the prior calendar year.1 Amounts contributed and not deducted in the year in which the contribution was made to an account may be deducted from the donor's Connecticut state income tax in the succeeding five years.

(Video) Are 529's Really the Best Way to Save for College?

Make the Most of Every Dollar

CHET Advisor Workplace 529

Offering the Fidelity-managed Workplace 529 Plan is a great way to show employees that you understand their needs and value their financial security. And it's a low-cost enhancement to employee benefits packages.

Employers can set up employee contributions to our Workplace 529 Plan either through payroll deduction or through Electronic Funds Transfers (EFTs) from employee bank accounts.

Learn more

(Video) Trends in 529 Distribution and Analytics

CHET Advisor 529 Plan | Fidelity Institutional (3)

Consider the Fidelity Investments 529 College Rewards® Visa Signature® Card

Earn unlimited 2% cash back on every eligible net purchase2 when you redeem your Reward Points as a deposit into an eligible Fidelity-managed 529 account.

There's no annual fee. And the card has no Reward Point caps or limits, and Points do not expire.2

Apply Now

(Video) CHET transition from The Hartford Funds to Fidelity - Charles Wareham, Financial Advisor

(Video) Setting Up A 529 College Fund with Fidelity

Choose the Best Strategy

CHET Advisor 529 lets you choose from three types of investment options so you can pursue the strategy that is best for your needs and circumstances. For each contribution, you determine how it is invested. You may also reallocate existing assets in your account twice every calendar year and whenever you change the account's designated beneficiary.

Investment choice and flexibility

Everyone is different: we all have distinct goals, individual tolerances for risk, varying time horizons. That's why CHET Advisor 529 allows you to choose from three types of investment options:

  • Age-based portfolios automatically reallocate assets based on the child's age.
  • Static portfolios enable you to tailor your account to your personal risk tolerance.
  • Individual investment portfolios allow you to invest in specific individual funds and construct a unique asset allocation plan.
  • The CHET Advisor 529 Plan is sponsored by the State of Connecticut and managed by Fidelity Investments. CHET Advisor 529 Plan accounts are not insured by any state, federal government or any federal agency. Furthermore, neither the principal nor any investment return is guaranteed by any state, federal government or any federal agency.
  • If you or the designated beneficiary is not an Connecticut resident, you may want to consider, before investing, whether your state or the designated beneficiary's home state offers its residents alternate state tax advantages or other state benefits such as financial aid, scholarship funds, and protection from creditors.
  • Units of the Portfolios are municipal fund securities and are subject to market fluctuation and volatility.
  • Please note that 529 plans may have certain fees and expenses including but not limited to annual maintenance fees, sales charges, deferred sales charges, administration, state, and management fees, and underlying fund expenses. Please consider these fees as well as the investment risks when investing in a 529 plan.
  • 1. Deductions for the same contribution may not be recognized over multiple tax years.
  • 2. You will earn 2 Points per dollar in eligible net purchases (net purchases are purchases minus credits and returns) that you charge. Account must be open and in good standing to earn and redeem rewards and benefits. Upon approval, refer to your Program Rules for additional information. You may not redeem Reward Points, and you will immediately lose all of your Reward Points, if your Account is closed to future transactions (including, but not limited to, due to Program misuse, failure to pay, bankruptcy, or death). Reward Points will not expire as long as your Account remains open. Certain transactions are not eligible for Reward Points, including Advances (as defined in the Agreement, including wire transfers, travelers checks, money orders, foreign cash transactions, betting transactions, lottery tickets and ATM disbursements), convenience checks, balance transfers, unauthorized or fraudulent charges, overdraft advances, interest charges, fees, credit insurance charges, transactions to fund certain prepaid card products, U.S. Mint purchases, or transactions to purchase cash convertible items. The 2% cash back rewards value applies only to Points redeemed for a deposit into an eligible Fidelity® account. The redemption value is different if you choose to redeem your Points for other rewards such as travel options, merchandise, gift cards, and/or statement credit. Other restrictions apply. Full details appear in the Program Rules new card customers receive with their card. Establishment or ownership of a Fidelity® account or other relationship with Fidelity Investments® is not required to obtain a card or to be eligible to use Points to obtain any rewards offered under the program other than Fidelity Rewards.
  • The creditor and issuer of this card is Elan Financial Services, pursuant to a license from Visa U.S.A. Inc.
  • Fidelity and Elan Financial Services are separate companies.
  • The creditor and issuer of this card is Elan Financial Services, pursuant to a license from Visa U.S.A. Inc.
  • Fidelity and Elan Financial Services are separate companies.
  • 3. Although an active asset allocation strategy within the Active Age-Based Portfolios is designed to add value, there is no guarantee any value will be added, and the strategy may result in losses to the Portfolios or may cause the Portfolios to have a different risk profile.
  • Investing involves risk, including risk of loss. You may gain or lose money over time. For individual fund-specific risks, click on each fund’s name to navigate to the fund details page.

FAQs

Should I use a financial advisor for 529 plan? ›

You won't need a financial advisor for your 529 plan if you are comfortable making investment decisions on your own. (And most financial advisors won't want to sell you a 529 plan if that is all you're asking them to do. The commissions are not worth all the time and effort it requires.)

What is the highest performing 529 plan? ›

The Vanguard 529 College Savings Plan

Does Dave Ramsey recommend 529 plan? ›

Dave warns against using a 529 Plan that would freeze your options or automatically change your investments based on the age of your child. Stay away from so-called “fixed” or “life phase” plans. You want to stay in control of the mutual funds at all times.

What are the disadvantages of 529 plans? ›

Cons. Most 529 plans include an administrative or annual fee, which tends to be around 0.14% to 0.53%. In addition, your investment options are limited with a 529 plan, as opposed to a brokerage or Roth individual retirement account (IRA), which gives you complete freedom to buy and sell whichever securities you want.

What is the best way to invest in 529 plans? ›

As mentioned, you can start a 529 plan either through an advisor or, less expensively, by investing directly with the plan's sponsor. While states administer 529 plans, they typically turn over the day-to-day operations to major financial services companies, such as Fidelity, T. Rowe Price, or Vanguard.

What is the difference between direct-sold and advisor sold 529 plans? ›

If you enroll in a direct-sold 529 savings plan, you are responsible for managing your own investments through their plan's online account portal. An advisor-sold 529 savings plan is a 529 savings plan that is sold through an investment firm.

Which states have best 529 plans? ›

  • The Best Overall 529 Plans.
  • New York's 529 College Savings Program - Direct Plan.
  • U.Fund College Investing Plan (Massachusetts)
  • UNIQUE College Investing Plan (New Hampshire)
  • Bright Start Direct-Sold College Savings Program (Illinois)
  • Ohio's 529 Plan, CollegeAdvantage - Direct Plan.
  • Oregon College Savings Plan.
9 Oct 2022

What is the average return on a 529 plan? ›

In 2011, people thought a rate of return around 3% for a 529 plan was amazing. Since 2011, the S&P's compounded annual growth rate (CAGR) is ~12% from June 2011 to June 2020.

How much should I put into 529 plan each month? ›

With a 529 plan, a solid monthly contribution amount for a child born in 2022 would be about $140 for a public in-state school, $215 for public out-of-state, or $350 for a private university.

Is a Roth IRA better than a 529 plan? ›

Is a Roth IRA better than a 529 plan? A 529 savings plan is generally an all-round good choice to pay for your child's (or your own) college, while Roth IRA may be a better option as a backup account to supplement educational expenses.

What if my child does not go to college and I have a 529? ›

What happens to unused 529 funds? Your 529 account will never expire, even if your child ends up not using it. You can leave the funds in the account, allowing investments to grow tax-deferred, and use the funds down the road for a grandchild or another qualified family member.

When should you not use a 529 plan? ›

You live in a state where you won't receive a tax credit or deduction for 529 plan contributions. You're not sure if your child will attend college. You're not sure how much money you'll need to save for college. You have investment experience and prefer to choose from a wide range of investment options.

Can you lose money in a 529 plan? ›

It's important to note that your investments can fluctuate, and you can lose money in a 529 plan. Your purchasing power can also decrease due to inflation, which means your investments may not keep up with the cost of college.

Can you use 529 money to buy a house? ›

Even if the student were to buy the home, they still can't use 529 plan money to make the mortgage payments. A mortgage payment is a payment on a loan and not a payment of housing costs. As such, it is not a qualified higher education expense.

What to Know Before opening a 529 plan? ›

So before you open a 529 plan, take note of these important steps.
  • Shop around. Each state plus the District of Columbia sponsors at least one 529 savings plan. ...
  • Learn how 529s affect financial aid. ...
  • Know what is considered a 'qualified expense' ...
  • Don't forget about the gift tax exclusion.
7 Jun 2022

Should I open multiple 529 accounts? ›

You may use a single 529 plan account to save for more than one child as long as you change the beneficiary when it's time to pay for your next child's college expenses — at no cost. In most cases, it makes sense to have a separate 529 for each child, but some parents may prefer to use a single plan.

Is a 529 better than a mutual fund? ›

Answer: Section 529 plans are often a more powerful tool than mutual funds because of the favorable federal tax treatment given to these plans. First of all, assets in a 529 are tax deferred. Plus, withdrawals from a 529 plan that are used to pay qualified education expenses avoid federal income tax.

What are the 2 types of 529 plans? ›

529 Basics

There are two types of 529 plans—college savings plans and prepaid tuition plans. The college savings version allows earnings to grow tax-deferred and withdrawals are tax-free when used for qualified education expenses. Every state offers at least one of these types of plans.

What is an advisory 529 plan? ›

2 A 529 plan is a tax-advantaged investment vehicle that encourages saving for the education expenses of a designated beneficiary and is sponsored by a state, state agency, or educational institution.

Are there differences in 529 plans? ›

There are two types of 529 plans, each of which offers different benefits and risks. These plans let you invest money in vehicles such as mutual funds or exchange-traded funds (ETFs). If you use the money for qualified educational expenses, you'll pay no taxes on your earnings.

Is a 529 plan better than a savings account? ›

A 529 college savings account can offer some advantages that you might miss out on with a regular savings account. The main benefits of a 529 plan over a savings account include: Tax-deferred growth. Tax-free withdrawals for qualified education expenses.

What is the best college fund for a child? ›

  • Open a 529 Plan.
  • Put Money Into Eligible Savings Bonds.
  • Try a Coverdell Education Savings Account.
  • Start a Roth IRA as a College Fund for Kids.
  • Put Money Into a Custodial Account.
  • Invest in Mutual Funds.
  • Take Out a Permanent Life Insurance Policy.
  • Take Out a Home Equity Loan.

Is it better for a parent or grandparent to own a 529 plan? ›

This is not likely to change under the new rules, as these private institutions could still impact your child's financial aid. Overall it is an excellent idea for a grandparent to open up a 529 plan for their grandchild. One of the benefits is that the grandparent can have more control of the money.

How much is too much for 529? ›

Consider funding your kids' 529 plan with no more than 75% of the savings goal. Pay for the rest by investing the rest in a flexible brokerage account or out of cash flow.

What happens to a 529 account when the child turns 18? ›

Myth: When my child turns 18, they can spend the money on anything they want. Reality: Savings in a 529 account are your assets, not your child's. The account holder controls the funds. Even when your child turns 18 years of age, they have no legal right to the money.

Does it matter what state your 529 plan is in? ›

You can use a 529 plan from any state to pay for an eligible college in any state. For example, you can use a 529 plan from Ohio to pay for college in Illinois. So, you don't need to move your existing 529 plan to another state.

Can you have multiple 529 plans? ›

The short answer is yes — the same child can be the beneficiary of multiple 529 plan accounts. If several people — parents and two sets of grandparents, for instance — want to help fund a child's education, they can either contribute to a single 529 account or set up separate plan accounts.

Does Vanguard have good 529 plans? ›

The Vanguard 529 College Savings Plan is sponsored by the state of Nevada and offers savers three age-based models. Vanguard's is among the cheapest plans available on the market and offers a stellar lineup in its portfolio.

Can you transfer a 529 plan to another state? ›

You can transfer funds in a 529 plan from one state to another through a direct rollover from the old 529 plan to the new 529 plan. You can also transfer the 529 plan through a distribution-contribution combination.

Does it matter where I open a 529? ›

529 plans are state-sponsored, but you can pick a plan from any state. Most states offer at least one 529 plan. You don't have to invest in your own state's plan, but many states offer residents a state tax deduction for doing so. (There is no federal tax deduction for 529 contributions.)

Can you open a 529 in your own name? ›

Students. As long as they are at least 18 years old, a student can open a 529 plan and name himself the beneficiary. Adults seeking a career change or graduate school probably wouldn't have much time to build their savings, but they may still be able to claim a state tax deduction for their 529 plan contributions.

Can you set up a 529 plan for yourself? ›

Regardless of your age, you can set up a Section 529 plan for yourself to fund educational expenses now or in the future. You can use the money in a 529 plan to upgrade your skills by just taking a few classes at a qualified college or trade school, or working towards a degree or advanced certificate.

How much money do you need to start a 529 plan? ›

There is no minimum to open or contribute to a 529 account. With the automatic investment plan , the minimum contribution level is $15 per month or $45 per quarter. $250, or $25 if you choose automatic monthly investing.

Where is the best place to open a 529? ›

  • The Best Overall 529 Plans.
  • New York's 529 College Savings Program - Direct Plan.
  • U.Fund College Investing Plan (Massachusetts)
  • UNIQUE College Investing Plan (New Hampshire)
  • Bright Start Direct-Sold College Savings Program (Illinois)
  • Ohio's 529 Plan, CollegeAdvantage - Direct Plan.
  • Oregon College Savings Plan.
9 Oct 2022

What happens to unused money in a 529 plan? ›

There is no penalty for leaving leftover funds in a 529 plan after a student graduates or leaves college. However, you'll face a 529 tax penalty and a withdrawal penalty if you use a 529 plan distribution on non-qualified expenses.

Is a Roth IRA better than a 529 plan? ›

Is a Roth IRA better than a 529 plan? A 529 savings plan is generally an all-round good choice to pay for your child's (or your own) college, while Roth IRA may be a better option as a backup account to supplement educational expenses.

Should parents or grandparents own 529 plan? ›

It is also fairly common for grandparents to own a 529 plan for the benefit of their grandchildren. A 529 plan is a great option to save money contributed from grandparents for the benefit of their grandchildren, it just might make more sense for the parents to own the plan.

What happens to a 529 account when the child turns 18? ›

Myth: When my child turns 18, they can spend the money on anything they want. Reality: Savings in a 529 account are your assets, not your child's. The account holder controls the funds. Even when your child turns 18 years of age, they have no legal right to the money.

What happens to my 529 if my child doesn't go to college? ›

If one child doesn't go to college at all, you can use their funds to pay up to $10,000 in student loans for each of their siblings. Transferring your 529 funds from one beneficiary to another family member is also an option.

Can 529 be used for rent? ›

Prepaid tuition plans, including the Private College 529 Plan, cannot be used to pay for room and board. Families using a prepaid tuition plan may consider opening a 529 college savings plan to save for room and board, books and supplies and other non-tuition costs not covered by prepaid tuition plans.

What is the max 529 contribution for 2022? ›

Annual 529 plan contribution limits

529 plans do not have annual contribution limits. However, contributions to a 529 plan are considered completed gifts for federal tax purposes, and in 2022 up to $16,000 per donor ($15,000 in 2021), per beneficiary qualifies for the annual gift tax exclusion.

How much should I put in 529 monthly? ›

With a 529 plan, a solid monthly contribution amount for a child born in 2022 would be about $140 for a public in-state school, $215 for public out-of-state, or $350 for a private university.

Can you use 529 money to buy a house? ›

Even if the student were to buy the home, they still can't use 529 plan money to make the mortgage payments. A mortgage payment is a payment on a loan and not a payment of housing costs. As such, it is not a qualified higher education expense.

How much is too much for 529? ›

Consider funding your kids' 529 plan with no more than 75% of the savings goal. Pay for the rest by investing the rest in a flexible brokerage account or out of cash flow.

Videos

1. 529 College Savings Plan
(401k and Beyond!)
2. 5 Steps for Picking the Best 529 Plan in Any State
(Let's Talk Money! with Joseph Hogue, CFA)
3. 529 & ABLE April 2021 Webinar - April 28, 2021
(Institutional Shareholder Services)
4. What is a 529 College Savings Plan [and How it can Solve the Student Loan Crisis]
(Let's Talk Money! with Joseph Hogue, CFA)
5. Why Is A 529 Better Than A Brokerage Account?
(Ramsey Everyday Millionaires)
6. 529 Year End Planning & Recap Webinar - December 9, 2020
(Institutional Shareholder Services)

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