Assets reached a record high, $4.5 billion, as of June 30, in the Nebraska Educational Savings Trust (NEST), Nebraska’s state-sponsored 529 college savings program, Nebraska State Treasurer Don Stenberg said today.
The program maintains more than 252,000 active accounts all across the country; 76,000 of those accounts are owned by Nebraskans. More than 20,000 new accounts have been added annually since 2011 with 10,162 new accounts added so far in 2017.
Stenberg said the total assets in NEST have increased by 87.5 percent since December 2010, shortly before he became State Treasurer and Trustee of NEST. Total assets then were $2.4 billion. The number of active accounts has grown by 38 percent during that same time, up from 182,706 to 252,424.
“Reaching $4.5 billion in assets is a significant milestone for the Nebraska Educational Savings Trust. While some of this remarkable growth is a reflection of the stock market’s current strength, the growth also reflects the high regard held for NEST by account owners and investors throughout the country. This growth reflects the widespread confidence in the program’s performance and future growth opportunities,” Treasurer Stenberg said.
He also attributed the growth to ongoing efforts by the Treasurer’s Office and First National Bank of Omaha, Program Manager of NEST, to make parents and grandparents aware of NEST and the benefits it offers to families looking for ways to save for higher education for their children and grandchildren.
“Our goal has been to provide an excellent college savings program with Midwestern values that meets the diverse needs of account owners and that provides families with cost-effective, responsible ways to save for college. We believe we have met and exceeded that goal, and we look forward to serving more account owners, beneficiaries, and families in the future,” Stenberg said.
“As program manager for the NEST 529 College Savings Plan, First National Bank does its very best to provide exemplary service and plan options to ensure that the dream of college can be better realized by our account owners,” said Deborah Goodkin, Managing Director, Savings Plans, First National Bank of Omaha. “The values and mission of First National Bank compel us to do nothing less. We take great pride in the partnership we have with our account owners and are encouraged with our continual plans’ growth both in terms of total assets and account owners.”
Rachel Biar, director of NEST for the Treasurer’s Office, said the growth in accounts indicates that families appreciate the variety of investment options offered by NEST, allowing a family to choose the plan that best fits the age of the child, the family budget, and the family’s investment philosophy. NEST offers four distinct plans: the NEST Direct College Savings Plan, the NEST Advisor College Savings Plan, the TD Ameritrade 529 College Savings Plan, and The State Farm College Savings Plan.
“This milestone also tells us that families in Nebraska and across the country believe in education. At NEST, we talk about the importance of young people dreaming for their futures at a very early age and parents and grandparents saving for those dreams. Studies show that children who have college savings accounts in their names are four to six times more likely to go to college than children who do not have savings accounts,” Biar said.
“I encourage parents and grandparents who are learning about NEST for the first time to consider opening NEST accounts for their children or grandchildren. They can begin by going to our website at treasurer.nebraska.gov or at NEST529.com to learn more about saving for college with NEST. For those who already own NEST accounts, I encourage you to increase your regular contributions or consider adding to a NEST account on special occasions like birthdays and holidays,” Stenberg said.
NEST college savings plans are tax-advantaged investment plans designed to encourage saving for the future higher education expenses of a designated beneficiary. Earnings in 529 plans that are used for qualified education expenses—like tuition, books, computer equipment, and some board and room expenses—are free from federal and state income tax.
State-sponsored 529 college savings programs take their name from Section 529 of the U.S. Internal Revenue Code, which provides tax benefits for account owners. NEST account owners in Nebraska can deduct up to $10,000 from their adjusted gross income on their Nebraska state income tax ($5,000 if married filing separately).
Money in NEST accounts can be used for higher education expenses anywhere in the United States. The accounts can be used at community colleges and technical schools, as well as at traditional colleges and graduate schools.
Parents, grandparents, aunts, uncles, other relatives, and friends can set up NEST accounts for loved ones or can contribute to accounts that have been set up by others. Only the account owner, however, can claim the tax deduction for contributions he or she makes to the account. Adults, too, who are planning to finish degrees or continue their education in graduate school can set up accounts for themselves.
In June, the NEST 529 Advisor Plan received top ranking in a nationwide analysis by Savingforcollege.com. The NEST 529 Advisor Plan ranked fourth overall for one-year investment performance not including sales charges and ranked second overall for three-year investment performance not including sales charges. Each quarter, the website analyzes the investment performance for 529 program portfolios and ranks the plans from best to worst for one-year, three-year, five-year, and ten-year investment performance.
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, the NEST Advisor College Savings Plan, the TD Ameritrade 529 College Savings Plan, and the State Farm College Savings Plan. The Nebraska State Treasurer serves as Program Trustee. First National Bank of Omaha serves as Program Manager, and all investments are approved by the Nebraska Investment Council. Families nationwide are saving for college using Nebraska’s 529 College Savings Plans, which have more than 261,000 accounts, including 84,000 in Nebraska. Visit NEST529.com and treasurer.nebraska.gov for more information.
About First National Bank of Omaha
First National Bank of Omaha is a subsidiary of First National of Nebraska. First National of Nebraska and its affiliates have more than $23 billion in assets and 5,000 employee associates. Primary banking offices are located in Nebraska, Colorado, Illinois, Iowa, Kansas, South Dakota and Texas.