The Investment Plan fees will vary by Investment Option:
| Investment Option |
Fee |
|
| Vanguard LifeStrategy® Growth Portfolio |
0.95% |
|
| Vanguard LifeStrategy® Moderate Growth Portfolio |
0.95% |
| Vanguard LifeStrategy® Conservative Growth Portfolio |
0.96% |
| Total Stock Market Index Portfolio |
0.83% |
| Total International Stock Index Portfolio |
0.99% |
What are the minimum investments for the Bank Plan?
The minimum investment levels within the Bank Plan will remain unchanged:
- Initial contribution: $250, $500, or $1,000, depending on the option selected.
- Subsequent contributions: $250, $500 or $1,000, depending on the option
selected.
You may also contribute smaller amounts using direct deposit from a financial
institution or via payroll
deduction. These amounts will be held in a savings account until the balance
reaches $250, $500, or
$1,000, as applicable. Please visit collegesavings.com/montana for more
information.
What are the minimum investments for the Investment Plan?
- Initial contribution: $25 (instead of the previous $500).
- Subsequent contributions: $25; $25 for AIP; and $15 for payroll deduction.
Subsequent contributions will be allocated on a percentage basis, with a minimum
allocation of 5% toward
any portfolio (i.e., if you make a $100 contribution to your account to be
allocated among three portfolios, a
minimum of $5 must be allocated to each of the portfolios you selected). These
minimums will not impact
the mapping of your existing investments at the time of the transition.
What will be different about the new Investment Plan?
Highlights of the new Investment Plan include five new portfolios featuring
underlying funds managed by
Vanguard, lower overall costs, enhanced online access, and innovative programs
that can help account
owners save more, including the Upromise® service and Ugift®.
About the new investment options:
| Investment Options from College Savings Bank |
Savings Option |
Maturity (Years) |
FDIC Insured 1 |
Description |
| Three FDIC-insured CD products and one FDIC-insured savings account product offered by College Savings Bank through the Bank Plan |
Savings Account |
N/A |
Yes |
Interest rate tied to the federal funds target rate |
| CollegeSure CD |
1 to 22 years |
Yes |
A variable rate CD indexed to a measure of college inflation |
| InvestorSure CD |
5 years |
Yes |
A variable rate CD indexed to the average increase in the S&P 500 based on a formula |
| Fixed Rate CD |
1 and 3 years |
Yes |
Designed to keep pace with competitive rates over the term of CD |
1 The Federal Deposit Insurance Corporation (FDIC) generally insures, with
respect to each FDIC-insured institution, deposit accounts (including principal and accrued interest) that are held in the
same right and capacity up to the maximum amount set by federal law, currently $250,000. Contributions to the Bank
Plan (including principal and any accrued interest) are insured by the FDIC on a pass-through basis to each
account owner up to the maximum amount. Under applicable FDIC regulations, accounts that have the same owner and the same designated beneficiary will be deemed to be held in the same right and capacity and will be combined for
purposes of the $250,000 limitation.
Will this transition count as my once-per-year investment exchange?
No. Federal law permits you to move existing 529 plan account assets to a
different mix of investment options once each calendar year, or whenever you change the account beneficiary.
Because this transition is a program-initiated change, it will not be considered your annual exchange.
Will my existing payroll deduction instructions remain in place?
No. Your payroll deductions will have to be re-established after the transition.
Before the transition takes place you will receive a letter from the MFESP with instructions on how to
re-establish your payroll deductions with your employer in a timely manner so your investments are not
interrupted.
Where can I find more information on the transition?
Account owners will be mailed a Transition Newsletter, which outlines the
transition and the new MFESP features. A copy of the newsletter is also available on the MFESP website at
mfesp.com. You can always contact the MFESP at 1.800.888.2723.
What investment options will be available after the transition?
The Bank Plan will feature three FDIC-insured CD products and one FDIC-insured
savings account product offered by College Savings Bank.
The Investment Plan will offer five portfolios featuring Vanguard mutual funds.
| Investment Options from Vanguard |
Investment Options |
Asset Class |
Allocation |
Category |
| Five portfolios featuring Vanguard mutual funds through the Investment Plan |
Vanguard LifeStrategy® Growth Portfolio |
Balanced |
25%-50% Stock
30%-55% Bond
20%-45% Short-term Fixed Income Invesments 2
|
Conservative Allocation |
| Vanguard LifeStrategy® Moderate Growth Portfolio |
Balanced |
45%-70% Stock
30%-55% Bond
20%-45%
0%-25% Short-Term Fixed Income Invesments 2
|
Moderate Allocation |
| Vanguard LifeStrategy® Growth Portfolio |
Balanced |
65%-90% Stock
10%-35% Bond
0%-25% Short-term Fixed Income Invesments 2
|
Moderate Allocation |
| Vanguard Total Stock Market Index Portfolio |
Stock |
100% Stock (Domestic) |
Large Blend |
| Vanguard Total International Stock Market Index Portfolio |
International |
100% Stock (International) |
Foreign Large Blend |
NOTE: 2. The Short-Term Fixed Income Investments consist of the bonds held by Vanguard
Short-Term Investment-Grade Fund
and any money market instruments held by Vanguard Asset Allocation Fund, two of
the underlying Vanguard funds in
which the Vanguard LifeStrategy Portfolios invest.
How will my money move to these new investments?
The following tables show how the assets in each investment option of your
Pacific Life Plan account will be moved to the new options in the enhanced MFESP. Note: Depending on your existing
investments, there may be cases in which your assets are mapped into accounts in both the Bank Plan and
the Investment Plan.
Investment mapping: Pacific Life Plan (PL) Portfolio Optimization Funds/
Money Market
| If you are currently invested in... |
Your assets will be moved to: |
| PL Portfolio Optimization Agressive Fund |
- |
Vanguard LifeStrategy (LS) Growth Portfolio |
| PL Portfolio Optimization Moderate Agressive Fund |
- |
50/50 Blend of Vanguard LifeStrategy (LSS) Moderate Growth and Vanguard LifeStrategy (LS) Growth Portfolios |
| PL Portfolio Optimization Moderate Fund |
- |
Vanguard LifeStrategy (LS) Moderate Growth Portfolio |
| PL Portfolio Optimization Moderate-Conservative Fund |
- |
Vanguard LifeStrategy (LS) Conservative Growth Portfolio |
| PL Portfolio Optimization Conservative Fund |
College Savings Bank Savings Account |
- |
| PL Money Market Fund |
- |
As of July 2, 2010, assets invested in certain other Pacific Life Plan
portfolios were moved to the College
Savings Bank Savings Account as an interim action. If you were invested in the
Pacific Life Funds listed
below, following the transition your assets will be moved to new investment
portfolios available under the
Bank Plan and/or the Investment Plan that most closely match your original
investment goals.
Investment mapping: Other Pacific Life Funds
| If as of July 2, 2010, you are currently invested in... |
Your assets are currently invested in: |
Following the transition, your assets will be moved to: |
| Bank Plan |
Investment Plan |
| Small-Cap Growth, Mid-Cap Growth, Large-Cap Growth, Growth LT, Large-Cap Value, Mid-Cap Equity, Real Estate, Comstock |
College Savings Bank Savings Account |
- |
Vanguard Total Stock Market Index Portfolio |
| International Large Cap, International Value |
College Savings Bank Savings Account |
- |
Vanguard Total International Stock Index Portfolio |
| Inflation Managed, Short Duration Bond, Managed Bond |
College Savings Bank Savings Account |
College Savings Bank Savings Account |
- |
Can I maintain my existing account in the Pacific Life Plan?
No. Pacific Life Funds has determined that it will no longer provide 529
investment services to the MFESP,
and the Pacific Life Plan will be discontinued. To simplify recordkeeping for
account owners and provide the
best possible service, account records and assets will be moved to the existing
Bank Plan or the new
Investment Plan as noted above under “How will my money move to these new
investments?”.
Are investments in the Bank Plan guaranteed?
Contributions to the Bank Plan are principal protected and FDIC insured.
Contributions to the Bank Plan,
including principal and any accrued interest, are insured by the FDIC on a
pass-through basis to each
account owner up to the maximum amount allowed by law, currently $250,000. Under
applicable FDIC
regulations, accounts that have the same owner and the same designated
beneficiary will be deemed to be
held in the same right and capacity and will be combined for purposes of the
$250,000 limitation.
Are investments in the Investment Plan guaranteed?
No. Investment returns are not guaranteed, and you could lose money by investing
in the Investment Plan.
For additional information following the transition, please refer to the MFESP
Investment Plan Disclosure
Statement, which you will receive separately or online at montanasaves.com.
If, as of July 2, 2010, you were
invested in…
Your assets are
currently invested in:
Following the transition, your
assets will be moved to:
Bank Plan Investment Plan
What does this transition mean to my account?
Your account assets will be automatically invested in portfolios featuring
mutual funds managed by
Vanguard in the Investment Plan and/or in the FDIC-insured savings deposit
option offered by College
Savings Bank in the Bank Plan.
How will I know my assets were transferred successfully?
You will receive confirmation statements prior to and after the transition:
- A confirmation statement from Pacific Life will reflect the account balance in
your Pacific Life Plan
account(s) on the day of the transition.
- A confirmation statement from College Savings Bank and/or Upromise Investments
will detail the
transition of your assets into the Bank Plan and/or the Investment Plan, as
appropriate. The new
statement(s) will confirm your account balance and specify how your assets have
been invested
following the transition.
- The transaction amount indicated on your closing statement from Pacific Life
will match your
aggregate opening account balance on the statements from College Savings Bank
and/or
Upromise Investments.
How can I make future contributions to my account(s)?
You will be able to contribute to your account(s) in a variety of ways including
check, electronic funds transfer
(EFT), AIP, or payroll deduction (if available through your employer). You may
also contribute through a
rollover or transfer from another education savings vehicle, like a Coverdell
Education Savings Account, an
UGMA/UTMA account, or another qualified tuition program. Please be sure to make
all future checks payable
to “MFESP, CSB as Manager” or “MFESP Investment Plan” depending on the MFESP
Plan to which you
are contributing.
NOTE: Contributions by check made payable to “Pacific Life Funds” received after
4 pm ET on
December 9, 2010 will not be processed and will be returned to the sender.
How will future contributions be allocated among investments?
Currently, you specify the exact dollar amount to be invested in each investment
option. After the transition,
new contributions will be automatically allocated among the new investment
options on a percentage basis.
Here’s how it will work:
- If your account is actively funded by regularly scheduled AIP from your bank
account, your
contributions will be invested on a percentage basis according to your
previously selected
investment allocations.
- If your account is not actively funded by regularly scheduled payments, your
future
contributions will be allocated based on your account balances as of Friday,
December 10, 2010, unless you indicate otherwise with each new contribution.
For example, if you currently have $750 in the PL Portfolio Optimization
Moderate and $250 in the Comstock
Large-Cap Value, after the transition you’ll have $750 in the Vanguard
LifeStrategy Moderate Growth
Portfolio and $250 in the Vanguard Total Stock Market Index Portfolio. Your
future contributions would be
invested 75% in the Vanguard LifeStrategy Moderate Growth Portfolio and 25% in
the Vanguard Total Stock
Market Index Portfolio. After the transition, you will be able to see your
allocations by logging on to your
account. You may have funds, based on your current allocations, which move to
both the Investment Plan
and the Bank Plan. You will always be able to change the way your future
contributions are allocated at any
time after the transition by completing an Account Maintenance Form.
Can I change my investment options after the transition?
Yes, subject to federally imposed limitations. If you would like to choose
different investment options after
the transition, you can do so as long as you have not already made an exchange
in 2010 - that is, if you have
not already reallocated your existing MFESP investments among the Program's
investment options. When
your investments are automatically moved to new investments as part of the
transition, it does not count as
your annual exchange. You can change the way your future contributions are
allocated at any time after
the transition.
Will the MFESP continue to offer state income tax benefits?
Yes. As was the case prior to the transition, Montana taxpayers will be entitled
to an annual $3,000
deduction to adjusted gross income per taxpayer ($6,000 if married, filing
jointly), in computing their
Montana state income tax, based on eligible contributions to the MFESP.
When can I access my account online?
Beginning Tuesday, December 14, 2010 at 9 am ET, you will be able to open new
Investment Plan accounts
online, view account balances, make contributions, exchanges, or qualified
withdrawals, and update account
information at montanasaves.com. Information on Bank Plan accounts will be
available at
collegesavings.com/Montana.
Will my AIP instructions carry over to my new MFESP account(s)?
If you have active AIP instructions at the time of the transition, those
instructions will automatically carry over
and can be applied to your account(s) in the new MFESP. However, if any
clarification of or change to your
AIP instructions becomes necessary in connection with the transition, the MFESP
will contact you.
(FOOTNOTE) 3 Contributions to an MFESP account owned by the taxpayer, the taxpayer's spouse
or the taxpayer's child or stepchild (if
the child or stepchild is a Montana resident at the time of the contribution)
are deductible in computing Montana
adjusted gross income for the tax year in which they are made. Contributions may
be subject to recapture in certain
circumstances, such as a non-qualified withdrawal or a withdrawal or
distribution from an account that was opened
within three years prior to the date of the withdrawal or distribution
(Recaptured Withdrawal). If the account owner is no
longer a Montana taxpayer at the time of a Recaptured Withdrawal, the Program
Manager or its service provider may
withhold the potential recapture tax from the Recaptured Withdrawal.
NOTE: 4. A plan of regular investment cannot assure a profit or protect against a loss
in a declining market.
Will I use the same website to access my account(s)/get information?
Following the transition there will be a new website for the MFESP, mfesp.com,
where you can access
information regarding both the Bank Plan and the Investment Plan. Each Plan will
also have its own website
following the transition:
- Bank Plan: collegesavings.com/Montana.
- Investment Plan: montanasaves.com.
The first time you go to log on, you'll re-register with your new account number
and create a new
password. Re-registering for access, beginning at 9 am ET on Tuesday, December
14, 2010, should
take just a few minutes using the easy onscreen instructions. You will need your
zip code, Social
Security number, and your account number from either your old Pacific Life Plan
account or your
new Investment Plan account (which will be on the confirmation statement you
receive following the
transition). Following re-registration, you will be able to access your account
online.
Who do I contact if I have more questions?
For more information about the MFESP, call 1.800.888.2723 or, following the
transition, visit us online
at mfesp.com.
New programs to help you save more
The MFESP is pleased to offer two popular services to Investment Plan account
owners: Ugift and Upromise.
Ugift®: Put college savings on your wish list! With Ugift, you can invite family
and friends to celebrate
occasions with a gift contribution to your Investment Plan account. Simply log
on to www.montanasaves.com
following the transition, click on the Ugift link, and follow the simple
directions to create an email invitation.
Upromise®: Want to earn even more money for college? When you join the Upromise
service, things you do
every day can add to your college savings. This service costs nothing to join,
and when you link your
Upromise and Investment Plan accounts, your earnings will be automatically
transferred on a periodic basis
($25 minimum).
NOTE: 5. Upromise is an optional service offered by Upromise, Inc., is separate from
the MFESP and is not affiliated with the
State of Montana or the Program Manager. Terms and conditions apply to the
Upromise service. Participating
companies, contribution levels, and terms and conditions are subject to change
at any time without notice. Go to
upromise.com to learn more.
For more information about the MFESP, call 1-800-888-2723 or visit www.mfesp.com
following the
transition to obtain an Enrollment Kit. Each Enrollment Kit includes a
Disclosure Statement that discusses
investment objectives, risks, charges, expenses, and other important
information; read and consider it
carefully before investing.
If you are not a Montana taxpayer, consider before investing whether your or the
beneficiary’s home state
offers any state tax or other benefits that are only available for investments
in such state’s qualified tuition
program. In addition, you should periodically assess, and if appropriate, adjust
your Section 529 Plan
investment choices with your time horizon, risk tolerance, and investment
objectives in mind.
The MFESP is sponsored by the State of Montana and administered by the Montana
Board of Regents of
Higher Education (Board), as sole trustee of the Montana Family Education
Savings Trust (Trust). The Board
selected College Savings Bank to serve as Program Manager for the MFESP.
Following the transition, the
MFESP will consist of two Section 529 plans, the Bank Plan (Bank Plan) and the
Investment Plan
(Investment Plan). When you invest in these plans, you are purchasing portfolio
units issued by the Trust.
Following the transition, College Savings Bank will continue to serve as the
MFESP Program Manager.
Upromise Investments, Inc. (UII) will provide distribution services and Upromise
Investment Advisors, LLC
(UIA) will provide recordkeeping and administrative support services for the
Investment Plan. UII, UIA, and
Upromise, Inc. are affiliates. Vanguard will serve as the investment manager for
the underlying mutual funds
comprising the Investment Plan’s portfolios. The portfolios, although they
invest in mutual funds, are not
mutual funds. Investment returns are not guaranteed, and you could lose money by
investing in the
Investment Plan. For additional information following the transition, please
refer to the Investment Plan
Disclosure Statement.
College Savings Bank, as Program Manager, will continue to support all aspects
of the day-to-day operations
of the Bank Plan, including marketing, recordkeeping and administrative support.
The Bank Plan offers four
portfolios that invest in either a College Savings Bank-issued CD or a savings
account. CDs may be subject to
early withdrawal penalties. Generally, contributions to the Bank Plan, including
principal and accrued
interest, are insured by the FDIC on a pass-through basis to each account owner
up to the maximum amount
set by federal law, currently $250,000. Under applicable FDIC regulations,
accounts that have the same
owner and the same designated beneficiary will be deemed to be held in the same
right and capacity and, as
such, will be combined for purposes of the $250,000 limitation. Please refer to
the MFESP 529 Plan
Disclosure Statement and the College Savings Bank Product Disclosure Statement
for additional
information.
Financial Advisers FAQ
In December 2010, the Pacific Life Funds 529 College Savings Plan (Pacific Life Plan) will be discontinued.
Your clients’ assets will be moved within the Montana Family Education Savings Program (MFESP) either to
portfolios in the new MFESP Investment Plan (Investment Plan) or to the newly named MFESP Bank Plan
(Bank Plan) offered by College Savings Bank (or, depending on your clients' existing investments, to portfolios
in both the Investment Plan and the Bank Plan). The Investment Plan will offer multiple investment portfolio
choices that invest in mutual funds from The Vanguard Group, Inc. (Vanguard), one of the nation’s leading
investment managers. College Savings Bank will continue as the Program Manager for the MFESP, including
the Investment Plan.
The Montana Board of Regents of Higher Education (Board) and College Savings Bank remain committed to
helping investors save money for future college expenses - while making the conversion process as
straightforward and convenient as possible. Your clients do not need to do anything at this time.
For more information about the transition, see Frequently Asked Questions for Account Owners.
What is the transition?
The MFESP is committed to giving families the best opportunities to provide a college education for their
children. With the discontinuation of the Pacific Life Plan, the MFESP decided to modify its existing offerings
to bring account owners a variety of new investment options and other enhancements. As a result of these
changes, as of December 2010, the MFESP will offer two Section 529 plans:
- The Bank Plan (previously known as the College Savings Bank 529 Program) features an
FDIC-insured savings account and certificates of deposit (CDs) from College Savings Bank; and
- The Investment Plan features investment options from Vanguard, a leader in low-cost mutual funds.
Upromise Investments, Inc. and Upromise Investment Advisors, LLC (together, Upromise Investments)
will provide distribution, recordkeeping, and administrative services for the Investment Plan.
Who is Vanguard?
Launched in 1975, Vanguard is one of the nation’s largest investment management firms and is well known
for its dedication to outstanding investment performance, exceptional service, and low costs. Vanguard is
committed to keeping costs low so account owners can keep more of their investment returns.
Who is Upromise Investments?
Upromise Investments is the country’s leading administrator of Section 529 college savings plans, devoted to
meeting the needs of families saving for college across the country.
What do my clients need to do?
At this time, they do not need to do anything. College Savings Bank will continue to be the Program
Manager and your clients' account information, including records and assets, will automatically move to the
new investment options.
When will the transition take place?
The transition will begin at 4 pm ET on Thursday, December 9, 2010, and is expected to be completed by
Monday, December 13, 2010. See the table at the end of these FAQs for a transition timeline.
When will client accounts be transferred?
The transfer will take place on or around December 10, 2010. The transition from the Pacific Life Plan will
take place automatically, and your clients’ new accounts will be established based on their account
information and investment balances as of the close of business on Friday, December 10, 2010. Clients will
not need to change any portfolio allocation. Investments in the current program will be moved automatically
to the most similar investments in the appropriate Plan within the new enhanced MFESP, as determined by
the Board.
Will I remain associated with my clients' accounts after the transfer?
No, Pacific Life Funds will not provide any broker information during the transfer. Following the transition, your
clients will work directly with the MFESP to manage their accounts.
If all fees are waived for transferred accounts, what type of compensation will a
broker/dealer receive?
Broker/dealers holding agreements with College Savings Bank will receive a commission as outlined in the
broker/dealer agreements for accounts in the Bank Plan. There will be no ongoing commissions associated
with the Investment Plan.
For fee-based advisors, what type of compensation will they receive?
College Savings Bank commissions are not paid out of the investable assets of the client so fee-based advisors
can receive the commission that College Savings Bank pays for accounts in the Bank Plan. There are no such
compensation arrangements within the new Investment Plan.
Will this affect the way my clients will receive information regarding their
MFESP accounts?
- Bank Plan: Advisors will continue to receive duplicate transaction confirmation and account
statements for clients invested in any of the options within the Bank Plan.
- Investment Plan: Account owners will receive transaction confirmations and/or quarterly and annual
account statements, as appropriate, depending on their transactions during the measurement period.
Clients can also request that their advisor continues to receive duplicate statements (as an interested
party) by completing the appropriate forms after the transition.
What is my role following the transition?
The Investment Plan is a Plan sold directly to investors. Assets transferring to College Savings Bank will also be
considered direct investments. In some circumstances College Savings Bank may be able to re-assign you (the
Advisor) to an account. Call 1.800.888.2723 for additional information.
Where can I obtain additional information?
A transition newsletter that outlines the new MFESP features will be mailed to you before the transition and
posted on the MFESP website at www.mfesp.com. You can also contact the MFESP at 1.800.888.2723.
Key Transition Dates
The following table details some key dates and actions during this period. |
| Key Dates |
Action |
| Ongoing |
Contact the College Savings Bank Call Center at 1-800-888-2723 if you have any questions regarding your account. Select option 3 for questions regarding the transition. |
| December 9, 2010 |
Pacific Life Funds will no longer accept contributions, transactions, or maintenance requests, including withdrawals or investment option changes, after 4 pm ET. |
| December 10-12, 2010 |
Account records are transferred. You will not have access to your account during the weekend. |
| December 13, 2010 |
First day of transaction processing by Upromise Investments. Transaction requests received in good order after 4 pm ET on Thursday, December 9 and by 4 pm ET on Monday, December 13 will be processed using unit values as off 4 pm ET on Monday, December 13. Customer service teams at College Savings Bank and Upromise Investments will be available to assist you at 1-800-888-2723. |
| December 14, 2010 |
New and improved website is available, featuring online account management for Investment Plan account owners. |
| December, 2010 |
You will receive a confirmation statement from Pacific Life detailing your account activity as of the date of the transition. You will receive a confirmation statement from Upromise Investments regarding your new investments in the Investment Plan and/or from College Savings Bank regarding your new investments in the Bank Plan (depending on how your assets move). |
| 2011 |
You will begin receiving quarterly statements from the new MFESP. College Savings Bank mails quarterly statements in February, May, August and November. Upromise Investments mails quarterly statements in January, April, July and October. |
| NOTE: On Friday, December 10, 2010, Pacific Life Funds will calculate your current account balances, and the MFESP will reinvest those balances in your new investment options. At the time of transition, your assets may be out of the market for one or more days intil the assets are invested in the new investment options. Should this occur, you will not receive any earnings or incur any losses based on the markets. |
For more information about the MFESP, call 1-800-888-2723 or visit www.mfesp.com following
the transition to obtain an Enrollment Kit. Each Enrollment Kit includes a Disclosure Statement
that discusses investment objectives, risks, charges, expenses, and other important information;
read and consider it carefully before investing.
If you are not a Montana taxpayer, consider before investing whether your or the beneficiary’s
home state offers any state tax or other benefits that are only available for investments in such
state’s qualified tuition program. In addition, you should periodically assess, and if appropriate,
adjust your Section 529 Plan investment choices with your time horizon, risk tolerance, and
investment objectives in mind.
The MFESP is sponsored by the State of Montana and administered by the Montana Board of
Regents of Higher Education (Board), as sole trustee of the Montana Family Education Savings
Trust (Trust). The Board selected College Savings Bank to serve as Program Manager for the
MFESP. Following the transition, the MFESP will consist of two Plans, the MFESP Bank Plan (Bank
Plan) and the MFESP Investment Plan (Investment Plan). When you invest in these Plans, you are
purchasing portfolio units issued by the Trust.
Following the transition, College Savings Bank will continue to serve as the MFESP Program
Manager. Upromise Investments, Inc. (UII) will provide distribution services and Upromise
Investment Advisors, LLC (UIA) will provide recordkeeping and administrative support services for
the Investment Plan. UII, UIA, and Upromise, Inc. are affiliates. Vanguard will serve as the
investment manager for the underlying mutual funds comprising the Investment Plan’s portfolios.
The portfolios, although they invest in mutual funds, are not mutual funds. Investment returns are
not guaranteed, and you could lose money by investing in the Investment Plan. For additional
information following the transition, please refer to the Investment Plan Disclosure Statement.
College Savings Bank, as Program Manager, will continue to support all aspects of the day-to-day
operations of the Bank Plan, including marketing, recordkeeping and administrative support. The
Bank Plan offers four portfolios that invest, in either a College Savings Bank-issued CD or a savings
account. CDs may be subject to early withdrawal penalties. Generally, contributions to the Bank
Plan, including principal and accrued interest are insured by the FDIC on a pass-through basis to
each account owner up to the maximum amount set by federal law, currently $250,000. Under
applicable FDIC regulations, accounts that have the same owner and the same designated
beneficiary will be deemed to be held in the same right and capacity and, as such, will be
combined for purposes of the $250,000 limitation. Please refer to the MFESP 529 Plan Disclosure
Statement and the College Savings Bank Product Disclosure Statement for additional information.
Employers FAQ
The Montana Board of Regents of Higher Education (Board) is making changes to the Montana Family
Education Savings Program (MFESP). Pacific Life Funds 529 College Savings Plan (Pacific Life Plan)
assets and accounts will be moving to the MFESP Bank Plan (Bank Plan) and the new MFESP Investment
Plan (Investment Plan).
The questions and answers that follow will give you information about any
changes or adjustments that your company might need to keep payroll deductions rolling smoothly.
For more information about the transition, see Frequently Asked Questions for Account Owners.
Will the MFESP continue to support payroll deduction?
Yes. The MFESP will continue to support payroll deduction contributions via ACH direct deposit and check.
- Bank Plan account owners: The Bank will be communicating with your employees who have
active payroll deductions to coordinate the necessary instructions to continue their payroll
deductions into the Bank Plan.
- Investment Plan account owners: A letter will be sent to your employees before the transition
with instructions on setting up their payroll deductions with the Investment Plan. The Payroll
Deduction Form will also be available online at montanasaves.com and by calling
1.800.888.2723. This form will include new routing information for you to submit your
employees’ funds.
What is the minimum contribution amount for payroll deduction?
The minimum contribution through payroll deduction to the Bank Plan will remain $25 per pay period, per
account. The minimum an employee can contribute to an Investment Plan account through payroll
deduction will be $15 per pay period, per account.
Will the MFESP charge employers to set up and maintain payroll deduction?
No. There are no fees associated with payroll deduction for employers.
What changes can my company expect related to payroll deduction?
The only changes will be to the remittance process for payroll deductions. You will receive new
instructions for remitting payroll deduction contributions via ACH.
- Payroll deduction payments by ACH: Payroll deduction will cease on Thursday, December 9,
2010 and start again on Tuesday, December 14, 2010. A letter will be sent to employees so that
there will be little or no interruption to their investments. Enclosed with their letter will be a
Payroll Deduction Form, which the employee will need to complete, sign, and forward to your
office. This form will provide you with the new remittance instructions.
- Payroll deduction payments by check: Beginning Monday, December 13, 2010, mail checks and
employee contribution instructions to the new administrator’s address listed on the following
page. No other changes are required.
What happens if I don’t update my payroll system with the new ACH instructions?
If you don’t remit ACH payments in accordance with the updated instructions, the contributions will be
rejected by the Program’s custodian.
Are affected employees being notified of the payroll deduction changes?
Yes. The MFESP is notifying all affected account owners (i.e., those whose employers transmit
contributions via ACH direct deposit) by mail shortly before the transition. The letter explains that in order
to restart payroll deduction the account owner must provide his/her employer with updated instructions
as outlined on the Payroll Deduction Form.
Whom do I contact if I have questions regarding payroll deduction changes?
For specific payroll deduction questions on the Bank Plan or the Investment Plan, call 1.800.888.2723.
Plan mailing addresses
By U.S. mail By registered, certified, or overnight mail
MFESP Investment Plan
P.O. Box 219448
Kansas City, MO 64121-9448
MFESP Investment Plan
2534 Madison Avenue, 3rd Floor
Kansas City, MO 64108
MFESP Bank Plan
College Savings Bank
P.O. Box 3769
Princeton, NJ 08543
MFESP Bank Plan
College Savings Bank
5 Vaughn Drive
Princeton, NJ 08540
For more information about the MFESP, call 1-800-888-2723 or visit www.mfesp.com following the
transition to obtain an Enrollment Kit. Each Enrollment Kit includes a Disclosure Statement that
discusses investment objectives, risks, charges, expenses, and other important information; read and
consider it carefully before investing.
If you are not a Montana taxpayer, consider before investing whether your or the beneficiary’s home
state offers any state tax or other benefits that are only available for investments in such state’s
qualified tuition program. In addition, you should periodically assess, and if appropriate, adjust your
Section 529 Plan investment choices with your time horizon, risk tolerance, and investment objectives
in mind.
The MFESP is sponsored by the State of Montana and administered by the Montana Board of Regents of
Higher Education (Board), as sole trustee of the Montana Family Education Savings Trust (Trust). The
Board selected College Savings Bank to serve as Program Manager for the MFESP. Following the
transition, the MFESP will consist of two Plans, the MFESP Bank Plan (Bank Plan) and the MFESP
Investment Plan (Investment Plan). When you invest in these Plans, you are purchasing portfolio units
issued by the Trust.
Following the transition, College Savings Bank will continue to serve as the MFESP Program Manager.
Upromise Investments, Inc. (UII) will provide distribution services and Upromise Investment Advisors, LLC
(UIA) will provide recordkeeping and administrative support services for the Investment Plan. UII, UIA, and
Upromise, Inc. are affiliates. Vanguard will serve as the investment manager for the underlying mutual
funds comprising the Investment Plan’s portfolios. The portfolios, although they invest in mutual funds,
are not mutual funds. Investment returns are not guaranteed, and you could lose money by investing in
the Investment Plan. For additional information following the transition, please refer to the Investment
Plan Disclosure Statement.
College Savings Bank, as Program Manager, will continue to support all aspects of the day-to-day
operations of the Bank Plan, including marketing, recordkeeping and administrative support. The Bank
Plan offers four portfolios that invest, in either a College Savings Bank-issued CD or a savings account.
CDs may be subject to early withdrawal penalties. Generally, contributions to the Bank Plan, including
principal and accrued interest are insured by the FDIC on a pass-through basis to each account owner up
to the maximum amount set by federal law, currently $250,000. Under applicable FDIC regulations,
accounts that have the same owner and the same designated beneficiary will be deemed to be held in
the same right and capacity and, as such, will be combined for purposes of the $250,000 limitation.
Please refer to the MFESP 529 Plan Disclosure Statement and the College Savings Bank Product
Disclosure Statement for additional information.
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