Monday, January 27, 2014
A report from the Institute for College Access & Success recently found the average debt for college graduates in South Carolina is now a staggering $27,416. As the cost of a college education continues to rise, the State Treasurer's Office has a way that you can begin making sound investments to help pay for the cost of a college education and provide a better future for your children or grandchildren. In this new year, I hope that you will make a resolution to enroll in South Carolina's Future Scholar 529 college savings program.
The Future Scholar 529 program, administered by the State Treasurer's Office, is consistently rated one of the top plans in the nation. I hope that you have seen the marketing efforts encouraging parents, grandparents, relatives and friends to make a financial contribution to a Future Scholar account. Enrollment is easy, there is no minimum contribution, and there are tax advantages available. Securing a strong financial and educational future for our children means securing a strong future for South Carolina.
The highly successful Future Scholar 529 College Savings Plan has allowed us to expand our commitment to the financial health of South Carolina's young people. Two years ago, we joined a national initiative among State Treasurers to create a financial literacy outreach program to teach school age children the importance of managing money. This year's financial literacy focus was “Log on to Financial Literacy.” During our “Log on to Financial Literacy” tour, we visited 15 schools across South Carolina to speak about the importance of financial literacy. I presented each school iPads loaded with financial literacy software and games that appealed to our young audience. The iPads and financial literacy software were not paid for with any of your tax dollars.
I believe that our Future Scholars 529 College Savings plan is one of the most successful programs in the entire nation due to achievements from our recent contract negotiations. The State Treasurer's Office put out for public bid the management of the Future Scholar 529 College Savings Plan in the fall of 2011. After responses from some of the nation's top 529 program managers, we negotiated a contract with Columbia Management. The new contract cut fees by 100 percent on our Direct Sold plan and by 70 percent on our Advisor Sold plan, making Future Scholar one of the most affordable 529 plans in the country. In addition to cutting fees, the new contract required our program manager to provide private funding to create public awareness about our 529 plan through marketing the Future Scholar 529 College Savings Plan. One aspect of Future Scholar's marketing plan is the advertisements that you've likely seen on your television or heard on the radio. Previous state treasurers deposited money from companies who ran the plan directly into the state treasury, making the dollars state funds, and used that money to market the plan. The Treasurer's staff then controlled these dollars and wrote the checks to not only place the ads on television, but to produce the ads. When I took office, I stopped this practice and instead instructed Columbia Management, through the new contract, to manage the production of and the payment for the ads. The dollars are no longer mixed with taxpayer dollars in state accounts, and are instead paid for directly by Columbia Management. Since that time, assets of the plan are up 42 percent and we have added over 10,000 enrollees. In fact, there are now more than 102,000 participants in South Carolina's Future Scholar program.
Not only do we have among the lowest fees in the nation, our Future Scholar 529 College Savings Plan consistently earns high marks from the industry's independent ratings groups. Morningstar has given us a Bronze award ranking and SavingForCollege.com has given us “5 Caps,” their highest rating. Because of the success of our program, thousands of children will get a head start in offsetting the rising costs of a college education. These programs, coupled with our efforts to assist schools teach children about fiscal responsibility through our financial literacy program, make our state a better place. As we enter this new year, please resolve to help a young person in your life achieve financial well-being by visiting www.treasurer.sc.gov/college-savings to sign up for a Future Scholar 529 College Savings plan today.
Curtis M. Loftis, Jr. has served as State Treasurer since 2011.