Nebraska State Treasurer Don Stenberg and First National Bank of Omaha today announced total assets in the Nebraska Educational Savings Trust (NEST) have reached $4.8 billion, up from $4.5 billion reported in August and more than double the total in late 2010 when First National became Program Manager and Stenberg was elected State Treasurer.
“While some of this remarkable growth reflects the stock market’s current strength, the growth also reflects the high regard held for NEST by account owners and investors throughout the country. We appreciate the confidence families in Nebraska and across the United States have shown in Nebraska’s state-sponsored college savings program, and we pledge to work hard to maintain that trust,” Treasurer Stenberg said.
In announcing the unprecedented growth, Stenberg and First National also announced the program management fee paid by NEST account owners will be reduced to 0.25 percent of the average daily net assets in the trust, effective December 17, 2017. The reduced fee affects account owners in the NEST Advisor College Savings Plan, the NEST Direct College Savings Plan, and the TD Ameritrade 529 College Savings Plan.
The program management fees previously ranged from 0.27 percent to 0.25 percent.
Treasurer Stenberg also reminded account owners that contributions to NEST accounts must be postmarked by December 31 to qualify for the 2017 tax year state income tax deduction. The maximum deduction is $10,000 for a couple filing jointly or for a single tax filer ($5,000 if married, filing separately). Account owners who contribute to their accounts electronically have until 10:59 p.m., CT, on December 31 to make their contributions. Account owners in other states should check the tax requirements in their home states, he said.
Treasurer Stenberg and First National Bank said the Nebraska Educational Savings Trust’s growth over the past seven years has been remarkable, both in terms of total assets and in the number of accounts. Treasurer Stenberg is Trustee of NEST, and First National is Program Manager.
Total assets in all four NEST plans—NEST Direct, NEST Advisor, TD Ameritrade, and The State Farm College Savings Plan— increased 101 percent since late 2010. Total assets grew from $2.39 billion on December 31, 2010, just before Stenberg took office, to $4.81 billion on November 30, 2017. In February 2017, two NEST plans—the NEST Advisor Plan and the TD Ameritrade Plan—each surpassed $1 billion in assets.
Since late 2010, the total number of accounts in all four NEST plans grew by 39 percent from 182,706 to 254,153. The participation rate of Nebraska families also increased from 11.07 percent in 2010 to 15.7 percent in 2017.
“At NEST, we strive to provide the best resources and benefits for account owners,” said Deborah Goodkin, Managing Director, Savings Plans, First National Bank of Omaha. “Since becoming Program Manager, we have lowered costs for the program management fee and reduced the total asset-based fees for the three plans we manage. We are proud to serve our account owners on their path to achieving their higher education dreams, and these milestones are a vital step to ensure these dreams become reality.”
“Our partnership with First National has been instrumental in improving and reducing costs of the NEST plans. Working together, we are committed to providing families with cost-effective and responsible ways to save for college. We look forward to continued success and expansion of our programs,” Stenberg added.
As part of the partnership between the Treasurer’s Office and First National, more than $100,000 in college savings scholarships were awarded to young people in 2017 through contests, drawings, and bonuses, including the Nebraska NEST Birthday Babies Drawing in honor of Nebraska’s 150th birthday. The drawing, in which one newborn a month is awarded a $529 contribution to a NEST account, continues through January 10, 2018, to allow parents of babies born in late December to enter.
Stenberg and Goodkin also pointed out that the U.S. Congress has increased the limit for the annual gift tax exclusion from $14,000 to $15,000, effective January 2018. This will make is possible for grandparents and others to contribute larger amounts to college savings accounts for their loved ones without tax consequences.
NEST highlights in 2017 include the following:
About NEST 529
NEST 529 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 over 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 $21 billion in assets and 5,000 employee associates. Primary banking offices are located in Nebraska, Colorado, Illinois, Iowa, Kansas, South Dakota and Texas.