We have some exciting changes coming to Achieve Montana effective April 24, 2020! Our Age-Based Investment Option is being transitioned to a Year of Enrollment Investment Option that features lower fees and a more gradual reduction in exposure to stocks. We are also adding two new Individual Portfolios – an Equity Index Portfolio that invests in the iShares Total US Stock Market Index Fund and a Bond Index Portfolio that invests in the Vanguard Total Bond Market Index ETF.

We are reducing our fees significantly as a result of the updates to our Investment Options. These fee reductions include reductions in underlying fund expenses as well as the service fee and state administrative fee. Effective April 24, 2020, asset based fees will range from 0.395% – 0.587%. That’s a decrease of as much as 29%!

No. All changes will occur automatically. You may wish to talk with your financial advisor about the new investments enhancements.

No. This change does not count towards your twice per calendar year investment option change limit because it is being initiated by the Plan.

Absolutely! However, you will not be able to transact, make changes or open a new account between 2:00 p.m. MT on Thursday, April 23rd and 5:00 a.m. MT on Monday, April 27th.

• Age-Based Investment Option: On April 24^th, 2020, accounts in the Age-Based Investment Option will automatically move to the Year of Enrollment Portfolio that correlates to the beneficiary’s date of birth as outlined in the chart below. Please refer to the Supplement for more details.
• Individual Investment Options: On April 24^th, 2020, if you are invested in one of our Individual Portfolios (Aggressive Portfolio, Growth Portfolio, Moderate Portfolio, Conservative Portfolio and Income Portfolio), you will remain invested in that Portfolio, but the underlying investments will change. These Portfolios will be called “Asset Allocation Portfolios” going forward. Please see the Supplement for more details.
• Capital Preservation Portfolio: No changes will be made to the Capital Preservation Portfolio.

Forms will be updated to reflect the change to the Year of Enrollment Option and the addition of two new Individual Portfolios – the Equity Index Portfolio and the Bond Index Portfolio. Old forms will continue to be accepted, but we may reach out to you for clarification if needed. The most current forms will be available online at achievemontana.com/home/resources/resources_forms.html. This change does not count towards your twice per calendar year investment option change limit because it is being initiated by the Plan.

Ugift is an innovative online feature that allows you to invite family and friends to celebrate special occasions with gift contributions to your Achieve Montana account.

529 plan assets are counted at different rates for the Expected Family Contribution (EFC) in the FAFSA formula. As of July 1, 2009, federal guidelines are as follows:

• If the student is a dependent, a 529 plan account is considered as the parent’s asset (if the account owner is the parent or the dependent student). As a result, it will generally be counted at a rate only up to 5.64% of its value for the EFC.
• If the student is not a dependent and is the account owner, the 529 plan account is treated as the student’s asset and is generally factored into the EFC at the higher rate of 20%.
• In other cases, the account does not count as an asset for federal financial aid purposes. (However, a student may have to report distributions received from the account as income for these purposes).

Note: Financial aid programs offered by educational institutions and other non-federal sources may have their own guidelines for the treatment of 529 plan accounts. For complete information about financial aid eligibility, you should consult with a financial aid professional and/or the state or educational institution offering a particular financial aid program, since rules and regulations often change.

Achieve Montana is a 529 plan administered by the Montana Board of Regents of Higher Education (the trustee of the Montana Family Education Savings Trust). Achieve Montana offers special advantages including: tax-deferred growth, generous contribution limits, and professional investment management.

The easiest way is to enroll online. It only takes about 10 minutes. If you prefer to enroll by mail, complete the Enrollment Form and make an initial investment for the benefit of an individual (the beneficiary). You must open a separate account for each beneficiary.

When you enroll in Achieve Montana, you choose to invest in one or more of seven different Investment Options, including the Age-Based Option and six Individual Portfolios, based upon your investing preferences, time horizon and risk tolerance. All of the contributions made to your Account grow tax deferred and distributions are free from federal and state income tax if used for Qualified Expenses.¹

It only takes $25 to open an account (by check or electronic funds transfer), or $15 with payroll direct deposit if your employer offers that benefit. You can also make regular monthly, quarterly, semi-annual, or annual contributions (minimum of $25 per month) from your checking or savings account with an Automatic Investment Plan (AIP).²

The total balance of all accounts within Achieve Montana for the same beneficiary cannot exceed $396,000.

A U.S. citizen or resident alien, 18 or older, or an entity that is organized in the U.S., with a Social Security number or Tax Identification number and a valid, permanent residential U.S. address can open an Achieve Montana account, regardless of income level. Parents, grandparents, other family members, and friends can open an account for any person they choose. You can also open an account to pay for your own higher education.

Yes. You can transfer your account to a “member of the family” of the beneficiary without incurring federal income tax or penalties.³

Yes. You may change your investment options up to two times per calendar year per beneficiary. If you have multiple investment options for a beneficiary, all changes for the calendar year for that beneficiary must be requested on the same day. For more information on making changes to your Account, see the Program Description.

Ugift is an innovative online feature that allows you to invite family and friends to celebrate special occasions with gift contributions to your Achieve Montana account.

529 plan assets are counted at different rates for the Expected Family Contribution (EFC) in the FAFSA formula. As of July 1, 2009, federal guidelines are as follows:

• If the student is a dependent, a 529 plan account is considered as the parent’s asset (if the account owner is the parent or the dependent student). As a result, it will generally be counted at a rate only up to 5.64% of its value for the EFC.
• If the student is not a dependent and is the account owner, the 529 plan account is treated as the student’s asset and is generally factored into the EFC at the higher rate of 20%.
• In other cases, the account does not count as an asset for federal financial aid purposes. (However, a student may have to report distributions received from the account as income for these purposes).

Note: Financial aid programs offered by educational institutions and other non-federal sources may have their own guidelines for the treatment of 529 plan accounts. For complete information about financial aid eligibility, you should consult with a financial aid professional and/or the state or educational institution offering a particular financial aid program, since rules and regulations often change.

Any number of people can contribute to the same Achieve Montana account, but total contributions cannot exceed $396,000 for all accounts for the same beneficiary in 529 plans sponsored by the State of Montana. This includes any funds held for the same beneficiary in the Montana Family Education Savings Program Bank Plan which is closed to new investments but continues to administer existing Bank Plan accounts.

Any person of any age with a Social Security number or Tax Identification number can be named as the beneficiary of an Achieve Montana account. As the account owner, you can select a child, adult or even yourself as beneficiary. If your beneficiary decides not to attend college or another qualified post-secondary institution, you can name another beneficiary who is a qualified member of the same family as the original beneficiary without incurring any penalties. Please see the Achieve Montana Program Description for more information on who qualifies.

Yes. As the account owner, you choose the portfolios in which you invest, as well as the distribution of the funds.

• Electronic funds transfer (minimum of $25) from your checking or savings account
• AIP² with scheduled contributions in set amounts of at least $25 per month from your checking or savings account
• Payroll deduction² (minimum of $15 per pay period) through participating employers
• Check (made payable to Achieve Montana)
• Rollover from another 529 plan, including the Montana Family Education Savings Program Bank Plan
• Rollover from a Coverdell Education Savings Account or a qualified Series EE or Series I U.S. Savings Bond
• Transfer cash from an UGMA/UTMA account (Note: consult with a tax advisor as there may be tax consequences)
• Ugift^® – Give College Savings (minimum of $15)
• Upromise^® (minimum of $25)

Yes. You can change the direction of your future contributions at any time. Federal law permits you to move your current assets in your Achieve Montana account to a different mix of investment options up to two times per calendar year.

Except to the extent of the New York Life Insurance Company guarantee that is available for the Capital Preservation Portfolio, investment returns are not guaranteed, and you could lose money by investing in Achieve Montana. For additional information, please refer to the Achieve Montana Program Description.

Achieve Montana has no commissions, loads, or sales charges. The total annual asset-based fee ranges from 0.47% to 0.83% (depending on which investments you choose). In addition, an Annual Account Maintenance Fee of $25 is charged to each account. This fee is waived if you are a Montana resident, use an AIP, take advantage of payroll deduction through your employer, or maintain an account balance equal to or greater than $25,000.

Upromise is a free to join rewards program that can turn every day purchases — from shopping online to dining out, from booking travel to buying groceries — into cash back for college. A percentage of your eligible spending will be deposited into your Upromise account. You can link your Upromise account to your eligible 529 account and have your college savings automatically transferred. Visit Upromise.com/Montana to learn more and enroll⁴.

Earnings grow tax deferred and are free from federal taxes when used for qualified higher education expenses.¹ Qualified higher education expenses include tuition, mandatory fees, books, supplies, and equipment required for enrollment or attendance; certain room and board costs during an academic period the beneficiary is enrolled at least half-time; and certain expenses for a special-needs student.

Yes. Contributions you make to an Achieve Montana account may be eligible as a yearly deduction to adjusted gross income of up to $3,000 per taxpayer per year ($6,000 for those married, filing jointly), in computing Montana state income tax³.

Individuals can invest up to $15,000 ($30,000 for married couples making a proper election) per beneficiary without incurring any federal gift-tax consequences provided you don’t make additional gifts to that beneficiary in the same year. In addition, “accelerated gifting” lets you contribute up to $75,000 per beneficiary in a single year ($150,000 for married couples making a proper election) and take advantage of five years’ worth of tax-free gifts at one time provided you don’t make additional gifts to that beneficiary for five years (Contributions are considered completed gifts to the beneficiary and are removed from your estate², but you, as the account owner, retain control.) For more information, consult your tax advisor or estate-planning attorney.

The money in your Achieve Montana account can be used for any purpose. However, to qualify for federal and Montana state tax-free withdrawals on earnings and avoid penalties, the money must be used for qualified higher education expenses for the beneficiary at an eligible educational institution.^{1, 2}

Eligible expenses can include tuition, mandatory fees, books, supplies, and equipment required for enrollment or attendance; certain room and board costs during any academic period the beneficiary is enrolled at least half-time; and certain expenses for a special-needs student.¹

No. Repayment of student loans is not considered a qualified higher education expense.

No. You can use the assets in your account toward the costs of nearly any public or private, 2-year or 4-year college nationwide, as long as the student is enrolled in a U.S.-accredited college, university, graduate school, or technical school that is eligible to participate in U.S. Department of Education student financial aid programs.² In fact, many U.S. colleges and universities now have campuses or locations outside of the country, where money from your account can be used.

Achieve Montana does not require a child to attend college immediately after graduating high school. There are no restrictions on when you can use your account to pay for college expenses.

If a beneficiary decides not to attend college, you have the following options.

• Stay invested. You can leave the money in the account in case the beneficiary decides to attend school later. There is no age restriction for using the money.
• Change the beneficiary. You can change the beneficiary on your account at any time provided that the new beneficiary is an eligible “member of the family” of the former beneficiary.³
• Withdraw the money for other uses. The earnings portion of a withdrawal not used for a beneficiary’s qualified higher education expenses is subject to federal and Montana state income taxes, to a 10% federal penalty tax and a Montana recapture tax.⁴ For limited exceptions to this penalty, please see the Program Description.

Additionally, any accumulated earnings that are withdrawn from your account must also be reported on the recipient’s income tax return for the year in which they are withdrawn. Contact your tax advisor to determine how to report a non-qualified withdrawal.