Editor's Picks

– Perspectives
– News
– Research
– Data
– Events
– Presentations
– ABLE Act Column

529 Dash, Required Reading for Your 529 Education: The goal of the 529 Dash is to address the specific needs and concerns of advisers, accountants and estate planners who sell and service families and institutions in the college financial planning process by providing industry relevant news, product training and best practices. Building upon the product training and trends will be our editorial insight, market data and research. Also, the 529 Dash will provide opportunities for you to learn from and network with your peers based on real life case studies and forums such as the Strategic Insight 529 Dash LinkedIn Group. By reviewing these success stories on college financial planning from your peers of advisers, accountants and estate planners, the barriers to supporting your clients and building your book of business will be reduced.

Please Read, Engage and Share.

Paul Curley, CFA
Editor-in-Chief of 529 Dash
Director of College Savings Research
Twitter: @PaulCurleyBC
LinkedIn: Strategic Insight 529 Dash LinkedIn Group

Perspectives: Editor's Letter

ABLE Act Update, 2017 NDSS Buddy Walk on Washington and How to Justify Your Fee as an Adviser

Inspiration comes when and where you least expect it. On April 4th, 2017, I flew to Washington, DC, to participate in a Congressional Staff Briefing hosted by the ABLE Alliance for Financial Empowerment in the House Ways and Means Committee Room. While the first panel consisted of key staffers for the sponsors of the three ABLE improvement bills, the goal of my panel was to discuss implementation of the ABLE Act to date, present analysis on program utilization and highlight the value of community development financial institutions (CDFIs) in the implementation process. Specifically, my role was to discuss the utilization of ABLE accounts from a market data perspective, as Strategic Insight aggregates the investment vehicle’s market data from the product providers and reports the data back out into the marketplace. Additionally, my goal was to provide insight into the impact of the three new ABLE improvement Bills introduced in the U.S. House and Senate on April 4, 2017:

—ABLE to Work Act (S.818/HR 1896): Allows incremental additional savings in ABLE accounts if beneficiary earns income.
—ABLE Financial Planning Act (S. 816/HR 1897): Allows assets to rollover from 529 to ABLE accounts.
—ABLE Age Adjustment Act (S.817/HR1874): Raises age of onset from 26 to 46.

The audience included Congressional staff who handle disabilities issues and self-advocates who were on Capitol Hill that day for meetings at Congressional offices as part of the 2017 NDSS Buddy Walk® on Washington. I arrived a day early of the Congressional Staff Briefing to support the ABLE Alliance and National Down Syndrome Society (NDSS) in the 2017 Buddy Walk® by discussing the ABLE improvement bills and importance of 529s with members of Congress and staffers from New Hampshire, my state of residence. As both ABLE accounts and 529 plans help families and have similar structure, the conversations were well received by all. Thank you NDSS and ABLE Alliance for the opportunity to participate on the panel, and for setting up the Congressional meetings.

The travel also provided me with a rare opportunity to put down the tethered electronics. During the landing portion of the flight, the plane was met with rough landing conditions. During the turbulence, I thought about how the value of financial planning may be explained to every day clients or passengers by paralleling the profession to commercial airline pilots. I would argue that financial planners, like airline pilots, have expertise in helping hundreds of families through college financial planning and through numerous different situations. While parents may not even have had the experience of helping to pay for one child through college, financial advisers have a much higher volume of experience in helping families to plan through the various tax, financial aid and estate planning hurdles. As such, financial advisors, like pilots, know when it’s okay to gain speed when times are okay or when to focus on maintaining balance when times are turbulent. Together, financial advisors help to ensure that families achieve their long term success through college financial planning and onto legacy planning. As such, I close with the argument that college financial planning through 529 plans and family planning through ABLE accounts provides an opportunity for you as an adviser to provide value to all clients through their most turbulent times from the initial step of saving more efficiently to cash flow management during the payout phase to legacy planning during the transition phase. Therefore, justify your fees by having the financial planning conversion today, and create a better reality for your clients.

News: Article Round-Up

Here is what you need to know from stories released this week.

New York Times, “New York’s free-tuition program will help traditional, but not typical, students.” Editor’s Take: While the program will pay for the tuition portion of the cost of higher education for certain families such as those earning less than $100,000 per year, it will not cover other expenses considered qualified expenses for 529s such as room and board, fees, books and electronics. Additionally, the Excelsior Scholarship will not pay for graduate school, requires that students graduate on time and that the scholarship recipients work within the state for four year after graduation. Therefore families will need to continue to create and execute a college financial plan.
WealthManagement.com, “How Middle-Class America Got Fleeced of Its Wealth.” Editor’s Take: Helping your clients to save, and to save efficiently and automatically towards their goals will create value for your clients.
BBC, “Students face sharp rise in interest on tuition loans.” Editor’s Take: Readers should note that the student loan debt issue in the United States has expanded abroad, and that the rise in interest rates will be a key factor in exasperating the issue further. Thank you Tony White for sharing, and much appreciated!
NCHRA (North California Human Resources Association), “Corporate 529 plans – Campaign for next generation employees” webinar on May 5th by Winnie Sun, Managing Director and Founding Partner of Sun Group Wealth Partners. Editor’s Take: Learn about how 529s can help employers on the webinar, and engage with Winnie Sun and Paul Curley on the #WinnieSun Twitter chats on Wednesdays at 2pm ET.

Last Week’s Most Read Story:
Forbes, “College savings plans: The next big employee benefit?” Editor’s Take: Planadvisers have an opportunity to help solve for this issue by helping their plansponsor clients to set up college financial planning benefits, and read our interview last week with Jeffrey S. Cohen on the topic here.

Research: Survey Stats on the Go

Here is what you need to know from data and research released this week.

300% increase or a quadrupling of the number of students borrowing over $100,000 happened over the past ten years, and those borrowing over $100,000 increased their default over that period as well. Editor’s Take: Student loan debt has been filling the college affordability gap, which increases the demand for student loan debt seminar’s for your clients children and grandchildren. These seminars also provide you with an opportunity to build an intergenerational bridge to the next owners of your client’s assets.
84% of companies offer financial security programs such as student loan counseling, compared to 76% last year. Editor’s Take: Companies providing college financial planning employer benefits is on the rise.
70% of college students graduate with student loans, and the average debt balance is $37,172. Editor’s Take: This data leads into the next bullet point.
11.2% of student loans are delinquent as of 2016. Editor’s Take: Given the size of the student loan debt burden upon graduation, a high percentage do have issue with repayment. This is an issue as student loan debt is rarely able to get dismissed in bankruptcy court or by other measures, which increases the importance of college financial planning.

Data: Market Sizing Update

Here is the latest market data by Strategic Insight that can be used by the media and other organizations, and contact Strategic Insight for more information and commentary on its proprietary data, research, events and digital publications.

December 2016 Quarterly 529 Market Sizing Data
– 13.1 million accounts invested $275 billion in assets in 529 savings and prepaid plans
– 12.0 million accounts invested $252 billion in assets in 529 savings plans
– 1.1 million accounts invested $23 billion in assets in 529 prepaid plans
– 4,064 accounts invested $14 million in assets in ABLE (529A) accounts

Read more
Events: 529 Conference 2017

When: September 11-13, 2017
Where: JW Marriott Orlando Grande Lakes
Overview: The 529 Conference is a highly interactive and educational industry gathering where you’ll meet and network with the entire 529 ecosystem. Using a 360-degree perspective, the conference drills down into the most significant trends and challenges facing the industry today and includes critical conversation and debate surrounding the latest legislative developments, product innovations, investment options, distribution strategies, marketing initiatives, consumer trends, regulatory announcements and much more.

Optional sessions are available in conjunction with the 529 Conference to offer attendees additional education and training. The pre-conference ‘Essentials Seminar’ provides an understanding of the granular details of 529 plans in a constantly evolving market, and the post-conference ‘ABLE Session’ provides insight and networking into successfully implementing ABLE accounts.

529 Conference Agenda Updates:
Kay Ceserani, Managing Director with Pension Consulting Alliance, LLC, has been confirmed as moderator of the “Evaluation and Selection of an Optimal Investment Line-Up” panel.
Peter Hughan, CIMA® CRPC®, 529 Sales Director with John Hancock Investments, has been confirmed as a moderator of the “Marketing and Distribution Strategies-View from Independent and Regional Channels” panel.
– Nathan Ganousis, ChFC, CLU, CMFC, Product Leader – Managed Investments with Edward Jones, has been confirmed as a panelist on the “Marketing and Distribution Strategies-View from the National Broker-Dealers” panel.
Registration for the event is now open.

Read more

This section provides a list of upcoming live presentations and webcasts, and please contact Paul Curley at paul.curley@strategic-i.com if you are seeking a speaker for an upcoming event.

– NAPFA, “Everything you wanted to know about 529 plans (Using them with holistic fee-only planning)” by Paul Curley, CFA, in Edina, Minnesota, on May 9th from 5pm to 7pm. This in-person live continuing education presentation is designed for advisors, but the general public is welcome. Register here.

– Strategic Insight and Legg Mason hosted a live continuing education 529 Webcast on March 29th titled, “Develop an Effective College Funding Strategy” with Paul Curley of Strategic Insight and Stephen Jobe of Legg Mason. Click here for a recording of the event, or read the follow-up brochure here to learn about the topics covered. Also, please contact scholarschoice@leggmason.com with any follow-up questions, and thank you for participating in this educational event.

ABLE Act Column

This section will cover this week’s top legislative updates, product developments, news and resources relating to ABLE accounts, which are tax-advantaged savings accounts for certain individuals with disabilities and their families. After-tax contributions grow tax deferred, and distributions from the accounts are tax exempt when used for qualified expenses.

Round-Up of this Week’s News, Data, Research, Events and Resources:

News & Resources:
Disability Scoop, “Congress weighs expanding ABLE act.” Editor’s Take: On April 4, 2017, three bills relating to ABLE accounts were introduced in the U.S. House and Senate:
—ABLE Financial Planning Act (S. 816/HR 1897): Allows assets to rollover from 529 to ABLE accounts.
—ABLE Age Adjustment Act (S.817/HR1874): Raises age of onset from 26 to 46.
—ABLE to Work Act (S.818/HR 1896): Allows incremental additional savings in ABLE accounts if beneficiary earns income.


Strategic Insight: 4,064 accounts invested $14 million in assets in ABLE accounts as of December 31, 2016.

Strategic Insight ABLE Summit 2017 on September 13, 2017 at the JW Marriott, Orlando Grande Lakes

List of Open ABLE Programs:
– Alaska: Alaska ABLE Plan
– Alabama: Enable Savings Plan Alabama
– Florida: Florida ABLE United Program
– Illinois: Illinois ABLE
– Iowa: IAble
– Kansas: Kansas ABLE
– Kentucky: STABLE Kentucky
– Michigan: MiABLE
– Minnesota: Minnesota ABLE plan
– Nebraska: Enable Savings Program 
– Nevada: ABLE Nevada
– North Carolina: NC ABLE
– Ohio: Ohio STABLE Program
– Oregon: ABLE for All Savings Program
– Oregon: Oregon ABLE Savings Plan
– Pennsylvania: PA ABLE
– Rhode Island: RI’s ABLE
– Tennessee: ABLE TN
– Vermont: Vermont ABLE
– Virginia: ABLEnow

April 17th, 2017
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