Lowered Fees and Adjustments to Underlying Funds Offer More Options
LINCOLN, Neb.–(BUSINESS WIRE)–Nebraska Educational Savings Trust is excited to announce investment
changes to the NEST Direct College Savings Plan, the NEST Advisor
College Savings Plan and the TD Ameritrade 529 College Savings Plan,
effective April 29, 2016.
The investment changes are intended to build on the strong lineup of
investment options that already exist in the Plans. Changes include
lowering costs, adjusting allocations to underlying investments in the
Age-Based and Static Investment Options, and changing underlying
“As NEST Savings Plans continue to grow, we are looking to make these
plans as efficient and cost-effective as possible,” said Nebraska State
Treasurer Don Stenberg. “Not only do these changes involve lowered fees,
but the replaced underlying investments and fine-tuned allocations could
yield even better performance than our investors currently enjoy.”
“We understand that our customers want to save as much as possible to
fund their higher education goals,” said Deborah Goodkin, Managing
Director, Savings Plans, First National Bank of Omaha. “These
improvements reflect our focus on continuously improving NEST and
reinforce the service we already provide to our investors nationwide.”
Highlights of the changes for each plan are the following:
NEST Direct College Savings Plan: The total estimated annual
asset-based fees will change. A total of 15 out of 20 (75 percent) of
the Age-Based Portfolios and one Static option will decrease between
one and four basis points.
NEST Advisor College Savings Plan: The total estimated annual
asset-based fees will change. A total of 17 out of 20 (85 percent) in
each of the Class A and Class C Age-Based Portfolios and two in each
of the Class A and Class C Static Options will decrease in price
between one and six basis points.
TD Ameritrade 529 College Savings Plan: The total estimated
annual asset-based fees will change. A total of 17 out of 20 (85
percent) of the Age-Based Portfolios and one Static option will
decrease between one and five basis points.
REPLACED UNDERLYING INVESTMENTS
1. Replaced SPDR Barclays International Treasury Bond ETF with
DFA World ex-US Government Fixed Income adding a new fund manager to the
NEST lineup while reducing volatility. (All three Plans)
2. Substituted Goldman Sachs Prime Obligations Money Market Fund
with the Goldman Sachs Financial SquareSM Government Money
Market Fund due to upcoming money market reform changes. (All three
3. Replaced Vanguard Inflation-Protected Securities with Vanguard
Short-Term Inflation-Protected Index to reduce interest rate
sensitivity. (Direct Plan and TD Ameritrade 529 College Savings Plan)
4. Replaced Dreyfus Bond Market Index Basic with iShares Core US
Aggregate ETF to increase performance and reduce cost. (Advisor Plan
5. Replaced American Century Inflation-Adjusted Bond with
vanguard Short-Term Inflation-Protected ETF to reduce interest rate
sensitivity. (Advisor Plan Only)
ADDED ONE INDIVIDUAL INVESTMENT OPTION
The American Funds The Income Fund of America® (AMEFX) has been added as
an Individual Investment Option to the Advisor Plan to offer a fund that
focuses on income generation from both stocks and bonds.
FINE TUNED ALLOCATIONS TO UNDERLYING INVESTMENTS IN AGE-BASED AND
The following changes will affect the three Plans:
Changed allocations to gradually get more conservative among the
Aggressive, Growth, Index and Conservative Options.
Adjusted real estate allocations from a fixed 5 percent allocation to
a more consistent and appropriate percentage of equity allocation.
Adjusted fixed income allocations to ensure consistency across
investment options and Age-Based portfolios while reducing the steep
range in the change in duration between Age-Based portfolios.
Reduced allocations to the TIPS fund in portfolios that were more
conservative and, therefore, more at risk to inflation.
Reduced allocations to the money market fund and increased allocations
to the FDIC-Insured Bank Savings Option in the Direct and Advisor
Plans to improve performance and to receive a higher yield.
NEST 529 is consistently recognized by national experts, including a 5
Caps rating (highest rating) from Savingforcollege.com for the NEST
Direct and NEST Advisor Plans. In addition, the NEST Direct Plan is
ranked one of the nation’s top ten performing 529 college savings plans
for last year in a recently released nationwide analysis by
NEST is a tax-advantaged 529 college savings plan and provides four
plans to help make saving for college simple and affordable: NEST Direct
College Savings Plan, the NEST Advisor College Savings Plan, the TD
Ameritrade 529 College Savings Plan, and The State Farm College Savings
Plan. The Nebraska State Treasurer serves as Program Trustee. First
National Bank serves as the Program Manager, and all investments are
approved by the Nebraska Investment Council. Families nationwide are
saving for college using Nebraska’s 529 College Savings Plans, which
have more than 243,000 accounts, including 70,000 in Nebraska. Visit NEST529.com and treasurer.nebraska.gov for
About First National Bank of Omaha
First National Bank of Omaha is a subsidiary of First National of
Nebraska. First National of Nebraska is the largest privately owned
banking company in the United States. First National and its affiliates
have $20 billion in managed assets and 5,000 employee associates.
Primary banking offices are located in Nebraska, Colorado, Illinois,
Iowa, Kansas, South Dakota and Texas.
Investments Are Not FDIC Insured* – No Bank, State or Federal Guarantee
– May Lose Value
*Except the Bank Savings Individual Investment
The Rosen Group
Abby Berman Cohen, 646-695-7044
Mary Hoffa, 402-602-6549
Director of Marketing
State Treasurer’s Office
Jana Langemach, 402-471-8884