Ohio Families Encouraged to Use Tax Refunds to Fund 529 College Savings Plan

This time of year many families across Ohio have already received, or will soon receive, their state or federal tax refund. The Ohio Tuition Trust Authority, the state agency administering Ohio's 529 college savings plan, is encouraging families to use some or all of their refund to save for college through the CollegeAdvantage 529 Savings Plan.

Special limited time, above market rates on 529 CDs now offered

COLUMBUS, Ohio, March 17 /PRNewswire-USNewswire/ -- This time of year many families across Ohio have already received, or will soon receive, their state or federal tax refund. The Ohio Tuition Trust Authority, the state agency administering Ohio's 529 college savings plan, is encouraging families to use some or all of their refund to save for college through the CollegeAdvantage 529 Savings Plan.

"Recent surveys of taxpayers indicate that tax refunds are spent primarily on reducing debt or are dedicated toward savings. Investing part, or all, of your tax refund in a 529 account can help accomplish both goals: your college savings will grow faster, which will help to reduce, or even eliminate, your need for college loans in the future," said Jackie Williams, Executive Director of the Tuition Trust.

Ohio's 529 plan, CollegeAdvantage, provides state and federal tax advantages to help Ohio families save. Families pay no taxes on the funds as they grow and withdrawals used for qualified higher education expenses are exempt from both federal and Ohio income tax. Ohio also offers a state tax deduction to encourage savings. Ohioans who enroll in and contribute to CollegeAdvantage can take advantage of a $2,000 annual state of Ohio income tax deduction. Up to $2,000 per contributor (or married couple) can be deducted annually for each child. Contributions over $2,000 per child can be deducted in future years.

Now is a great time for Ohio families to start or add to an existing CollegeAdvantage account. CollegeAdvantage offers a wide variety of investment choices from leading financial institutions such as The Vanguard Group, Putnam Investments and Fifth Third Bank. Investment fees for the Vanguard and Putnam investment options were recently reduced making Ohio's plan one of the lowest cost 529 programs in the country. And, for a limited time, Fifth Third Bank is offering special above-market rates on CollegeAdvantage Fifth Third 529 Certificates of Deposit.

From now until June 30, 2008, the Fifth Third 529 CDs will be offered at above-market rates on terms ranging from 36 to 59 months. The Fifth Third 529 CDs offer a guaranteed rate of return, are backed by the FDIC, and have a low $500 minimum opening contribution. The special CD rates range from 3.75% to 4.0% on the terms listed below. CollegeAdvantage also offers CD terms ranging from 3 months up to 12 years; go to http://www.collegeadvantage.com for current APYs for CD terms.

Special limited time above-market rates for CollegeAdvantage Fifth Third 529 CDs available until June 30, 2008.

CD Term APY*
36 - 47 months (3 to 4 years) 3.75%
48 - 59 months (4 to 5 years) 4.00%

*Annual Percentage Yields (APYs) are accurate as of 3-17-08 and are guaranteed until 6-30-08. Penalty for early withdrawal.

CollegeAdvantage is one of the largest 529 plans in the country. Funds in CollegeAdvantage can be used at any college in the country to pay for tuition, fees, books and room and board. Families can open a CollegeAdvantage account by completing an account application online at http://www.collegeadvantage.com or by calling 1-800-AFFORD-IT (233-6734) and requesting an enrollment kit.

The Ohio Tuition Trust Authority is a state agency created by the Ohio General Assembly in 1989 to help Ohio families prepare financially for higher education. The Tuition Trust offers the CollegeAdvantage 529 Savings Plan to provide families with a tax-advantaged way to save for college.