COLUMBUS, Ohio--(BUSINESS WIRE)--According to a recent study from Fidelity, more parents are saving for college (74% in 2024 versus 58% in 2007). But as education costs continue to rise, the choice of where and how to save becomes as important as the decision to do so. Ohio 529, CollegeAdvantage is pleased to announce that the CollegeAdvantage Direct 529 Plan and the BlackRock CollegeAdvantage Ohio Advisor 529 Plan both received “Silver” ratings in Morningstar’s Medalist Ratings. Announced each year, these ratings reflect analysts’ forward-looking views of which plans are best suited to help investors reach their goals. With this latest announcement, Ohio is the only state program with both a Direct and Advisor 529 Plan ranked in silver or higher by Morningstar.
Morningstar praised the Ohio Direct 529 Plan for its low fees, well-designed portfolio options, range of investment choices, and strong stewardship. The BlackRock Advisor 529 plan, while similar in its sophisticated investment approach and oversight, has higher fees typical of advisor-sold plans but compensates with a broad selection of portfolios and a well-crafted glide path.
"Our 2024 assessment of 529 education savings plans highlights significant strides in investment quality and state stewardship, with more than half of evaluated plans receiving a Bronze rating or better," said Hyunmin Kim, manager research analyst at Morningstar, in this year’s report. "The evaluation process focuses on the importance of well-constructed portfolios, effective oversight, and seasoned management, and we're committed to helping savers determine the best plan options to help fund their education."
For more information about the ratings as well as the other accolades Ohio 529 has received in 2024, click here.
Deadline Approaching: Give the Gift of Lifelong Learning
Any Ohio taxpayer – including parents, grandparents, family members and friends – who enrolls in or contributes to an Ohio 529 account can open the door to college and career training for a loved one, while also claiming a tax deduction up to $4,000 per beneficiary on their state of Ohio taxable income. Account owners pay no taxes on account earnings, and withdrawals used for qualified higher education expenses are exempt from both federal and state taxes. All contributions for 2024 must be received in good order before 4 p.m. EST on December 31, 2024, making a 529 contribution a meaningful gift that lasts a lifetime.
New This Year: Roll Over Unused Funds into a Roth IRA
Account holders worried about unused funds in their existing Ohio 529 plans can now roll those funds into a Roth IRA. Thanks to the Secure 2.0 Act of 2022, the rollover from a 529 plan to a Roth IRA is a tax-free and penalty-free rollover. The rollover is subject to certain rules and guidelines.
“This newest update allows for much greater flexibility for account holders, particularly if their child decides not to pursue higher education or receives scholarships or financial aid that largely cover their costs,” said Trisha Good, executive director for Ohio 529. “Now, you’re not only giving your kids a jumpstart on their education goals, but you could help jumpstart their retirement savings.”
Funds in Ohio 529 can be used at all types of qualified higher education institutions, including a four-year college or university (public or private), two-year community college, technical or trade school, apprenticeship, or a certificate program. In addition, funds may be used to pay qualified higher education expenses including tuition, fees, room and board, books, computers, and class supplies. Families can even use up to $10,000 for student loan repayment.
For more information, please visit www.collegeadvantage.com
About the Ohio Tuition Trust Authority/Ohio’s Direct 529 Plan
Ohio 529, CollegeAdvantage is offered and administered by the Ohio Tuition Trust Authority (OTTA), a state agency under the Office of the Chancellor of the Ohio Department of Higher Education. Ohio is the seventh-largest state sponsor of 529 plans in the country. Ohio 529 currently has $18.2 billion assets under management with more than 675,000 accounts. Learn, plan, and start today with Ohio 529 at https://www.collegeadvantage.com.
