Nebraska’s 529 College Savings Plan Expands and Updates
Investment Choices, Lower Prices
(OMAHA, Neb. March 22, 2012) – First National Bank of Omaha (FNBO), the
Nebraska Educational Savings Trust (NEST), and Nebraska State Treasurer Don
Stenberg today announced important investment plan changes designed to enhance
the customer experience, respond to current market conditions and lower account
owner costs for NEST, Nebraska’s 529 College Savings Plan. The State Treasurer
serves as the Trustee of NEST and First National Bank of Omaha serves as Program
Manager. The plan changes were approved today by the Nebraska Investment
Council, which is responsible for investment oversight.
“We are committed to nurturing a smart and thoughtful strategy to address the
costs of higher education and help parents and grandparents plan for their
children’s future,” Treasurer Stenberg said. “The improvements to our College
Savings Plan will modestly expand the investment options and reduce price,
allowing us to offer a more competitive product.”
Changes made to the NEST Direct, NEST Advisor and TD Ameritrade 529 college
savings plans include the following:
- Reduced portfolio expenses (net of asset-based fees) by up to 52 percent,
resulting in total estimated annual asset-based fees being reduced by an average
of 0.03 percent each for NEST Direct and NEST Advisor Plans. The TD Ameritrade
529 Plan has also been reduced.
- Modestly expanded the underlying fund asset classes in response to
current and projected market conditions, resulting in more diversified
investments well suited to respond to market variability. Fixed Income
diversification was achieved by adding a Global Bond fund and Short-Term Bond
fund into both the allocations and individual options. Individual Option
diversification was achieved by adding Equity Income and Emerging Markets funds.
- Fine-tuned allocations to existing underlying funds to reduce cost and
expand diversification. Recognizing the current state of money market
investments, administrators reduced allocations to the money market fund in
Age-Based and Static options and added other low risk investments, including the
plan’s FDIC-insured option, into the NEST Direct and NEST Advisor Plans.
- Maintained open architecture plans at reasonable costs by selecting new
or replacement funds with an eye towards providing solid and affordable
investments, including adding iShares, SPDR and Vanguard exchange traded funds
- Enhanced the customer experience by adding innovative, useful and
cost-effective features including dollar cost averaging through systematic
exchanges and the ability to waive the Class A load for assets rolling in from
other 529 plans, if permitted by the broker dealer firm.
“When we first launched NEST, we reduced the program management fee by 50
percent; these new changes continue our policy of providing investments
appropriate for the direct, RIA and Advisor communities at a competitive cost, ”
said Deborah Goodkin, Managing Director, College Savings Plans at First National
Bank of Omaha. “Looking forward, we are committed to providing customers with an
easy way to save for college while helping them earn as much as they can with
smart investment choices.”
Goodkin added that Kiplinger’s Personal Finance magazine named NEST the “Best
College Savings Plan” for Fund Selection in 2011 and these investment changes
are intended to build upon the strong line-up of investment options that already
exists within the plan. Treasurer Stenberg said that plan participants will
receive official notification of the changes in May, with the changes to the
plan scheduled to take effect by July.
NEST is a tax-advantaged 529 college savings plan and provides four plans to
help make saving for college simple and affordable: NEST Direct College Savings
Plan, NEST Advisor College Savings Plan, TD Ameritrade 529 College Savings Plan,
and The State Farm College Savings Plan. The Nebraska State Treasurer serves as
the Program Trustee. First National Bank serves as the Program Manager, and all
investments are approved by the Nebraska Investment Council. Currently, more
than 52,000 families in Nebraska and over 189,000 nationwide are saving for
their children’s higher education through NEST. For more information, visit
www.NEST529.com or www.treasurer.org.
First National Bank is a subsidiary of First National of Nebraska. First
National of Nebraska has grown into the largest privately owned banking company
in the United States. First National and its affiliates have $17 billion in
managed assets and nearly 5,000 employee associates.
Primary banking offices are located in Nebraska, Colorado, Illinois, Iowa,
Kansas, South Dakota and Texas.
Investments Are Not FDIC Insured* · No Bank, State or Federal Guarantee · May
*Except the Bank Savings Individual Investment Option