You can open a Franklin Templeton 529 College Savings Plan for as little as $250—or $50 if you choose the monthly automatic investment plan option. After that, minimum contributions are just $50.
Withdrawals for qualified higher education expenses are free from federal income taxes. Contributions are not tax deductible. Individuals may also contribute up to $70,000 ($140,000 if a married couple) per beneficiary to a plan in a single year without paying federal gift tax if no further contributions to that beneficiary are made for the following 5 years. Assets in each plan are generally not included in your federal taxable estate.
Tax benefits are conditioned on meeting certain requirements. Federal income tax, a 10% federal tax penalty, and state income tax and penalties may apply to nonqualified withdrawals of earnings. Generation-skipping tax may apply to substantial transfers to a beneficiary at least two generations below the contributor. Please refer to the Investor Handbook for more complete information.
Absolutely. You—not the beneficiary—maintain control over how and when plan assets will be spent for higher education expenses.
Yes, you can change the beneficiary at any time. To avoid taxes, the new beneficiary must be a member of the previous beneficiary's family (including children, grandchildren, siblings, spouses, nieces and nephews, aunts and uncles, cousins and in-laws).
Yes. To move assets from an UGMA or UTMA account into a Franklin Templeton 529 College Savings Plan, the custodian of the UGMA or UTMA account must liquidate any securities in the account, then use the cash proceeds to invest in Franklin Templeton 529 College Savings Plan. This liquidation is a taxable event, and the minor owner of the UGMA/UTMA assets will be taxed on any gain realized on the securities being liquidated. Investment in the 529 plan may result in assessment of a sales charge. The minor must remain the 529 plan beneficiary at all times. When the minor becomes a legal adult, he or she will gain full control of the assets. These factors have significant income, estate and gift, and financial aid qualification considerations that should be discussed in detail with your tax advisor before any decision is reached on liquidating UGMA/UTMA assets and investing them in a Franklin Templeton 529 college savings plan. To obtain a transfer form, please call (800) 818-4030 or visit the Forms & Applications section.
You may roll over funds from another qualified tuition program established under Section 529 of the Internal Revenue Service Tax Code to Franklin Templeton 529 College Savings Plan. This rollover will be subject to federal tax requirements, and you will need to provide Franklin Templeton with acceptable documentation from the prior program detailing which portion of any rollover contribution consists of a return of principal and which portion consists of earnings. Contact your tax advisor for more information.
You can select a new beneficiary who is a member of the previous beneficiary's family.
Your beneficiary can attend almost any U.S. full-time or part-time undergraduate or graduate school. Plan assets may also be used for training after high school at many proprietary trade schools. In both cases, plan assets may be applied to tuition, fees, required books, supplies and equipment, and room and board if the beneficiary is enrolled at least half time.
No it is not. Franklin Templeton 529 College Savings Plan does not guarantee your investment or any specific rate of return, which means you may have a gain or a loss when you sell your shares.
Absolutely. You can establish a plan for yourself, your children or even a friend.
Investors should carefully consider plan investment goals, risks, charges and expenses before investing. To obtain an Investor Handbook, which contains this and other information, talk to your financial advisor, go to the Order 529 Literature section on this website, or call Franklin Templeton Distributors, Inc., the manager and underwriter for the plan, at
Offered and administered by the New Jersey Higher Education Student Assistance Authority (HESAA); managed and distributed by Franklin Templeton Distributors, Inc., an affiliate of Franklin Resources, Inc., which operates as Franklin Templeton Investments. No federal or state guarantee. Principal value may be lost, and investing in the plan does not guarantee admission to college or sufficient funds for college. Please refer to the Investor Handbook for more complete information.