Step 1—Minimum Suitability Criteria

· Do you meet residency requirements?

· Do you meet other eligibility requirements?

· Can the account owner and beneficiary be the same person?

· Does the program allow funds coming from an existing UTMA or UGMA custodial account?

· Will the program accept a corporation or trust as account owner?

· Can the account be set up directly (not through a broker)?

· Is the account minimum less than $1000?

· Does the program accept contributions through payroll deduction and/or EFT from a bank account?

· Is the program gift tax friendly?

Step 2— Investment Suitability Criteria

· Does the program provide a “guarantee” that you investment will keep up with the increasing costs of college?

· Does the program offer an “age-based” asset allocation strategy, a menu of “static” portfolios, or both?

· Is you principal protected?

· Are the underlying assets easily understood and researched?

· Does the program permit contributions to be allocated among multiple options?

· Is investment of contributions timely (within 24 hours)?

· Are earnings reinvested?

· Is enrollment free?

· Is annual account maintenance free?

· Are other transactions free?

· Can you claim a state income tax deduction for any or all of your contributions to the program?

· Does the program offer any other financial incentives?

· Will the account positively impact FAFSA-based eligibility?

· Is the account managed passively?

· Is the program widely utilized (greater than $100MM in assets)?

· Is the program free from reliance on state or federal government subsidy?

· Is the program “portable” to many institutions, including other states?

· Is the program refundable with minor penalties?

· Is the return from the program competitive with the marketplace (proxy: S&P 500)?

· Is the “tuition guarantee” backed by the full faith and credit of the state?

· Will the program allocate investment surpluses to participant accounts?

· Does the program provide an inflation hedge?

Step 3— Manageable Restrictions

· Is the program free from penalties for early withdrawal?

· Are qualified withdrawals from the program exempt from your state’s income tax?

· Can the program be used for any length of time or age?

· Can withdrawals be taken at any time after contributions have been completed?

· Would rolling this program over to another program have a positive impact on withdrawal restrictions or penalties?

· Will the program approve a request to transfer ownership of the account?

· Are contributions unlimited, or at a very high relative amount?

“Financial planners and investment advisers that have made the investment in time, education, and training to become genuine experts in college planning deserve special recognition,” says Joseph Hurley CPA, founder and CEO of Savingforcollege.com and one of the nation’s preeminent experts on saving and investing for college.

In addition to all of the information on these pages, you have come to the right place if you need a little advice. I am a College Planning Specialist.