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Bright Start Direct-Sold College Savings Program

4 / 5

Our rating

Good IL resident benefits

IL resident benefits

TIAA-CREF Tuition Financing, Inc as program manager of the Bright Start College Savings Program . The Illinois direct-sold Plan features two age-based options using either a Passive Enrollment or Active Blend Enrollment Year Portfolios, three Passive Static Allocation Portfolios, three Active Blend Static Allocation Portfolios, individual fund portfolios from a number of fund families and an FDIC-insured option.

Bright Start Direct-Sold College Savings ProgramHonors

KEY METRICS

OVERVIEW

Program type

Savings

Inception

2000, but substantially changed in July 2007 and again in July 2017.

State agency

Illinois State Treasurer

Tax deduction

For single filers: $10,000/yr per beneficiary

For joint filers: $20,000/yr per beneficiary

Program manager

TIAA-CREF Tuition Financing, Inc.

Program distributor

TIAA-CREF Individual & Institutional Services, LLC

Manager contract term

MORE INFORMATION

Eligibility

State residency requirements:

None

Who can be a participant/owner in the program?

U.S. resident individuals, UGMA/UTMA custodians, a Trust, and legal entities.

Significant time or age restrictions imposed by the program:

None

Contributions

Maximum contributions:

Accepts contributions until all account balances in Illinois' 529 plans for the same beneficiary reach $500,000.

Minimum contributions:

No minimum.

Does the program offer an e-gifting platform for receiving gift contributions?

This plan offers an online tool to share a gift contribution link with family and friends.

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Other great plans to consider

You are not limited to your own state's 529 plan, so compare the plan and tax benefits offered by your state to other options. Here are some plans that are available to residents of any state and have earned awards in our 529 Plan Ratings:

Investment Options

Investors in Bright Start Direct-Sold College Savings Program can select from the following investment options. Click on a portfolio name for more information.

Choose between Passive Enrollment Year Portfolios and the Active Blend Enrollment Year Portfolios, each containing 20 portfolios in Aggressive and Moderate glidepaths. Contributions are placed into the portfolio corresponding to the beneficiary's age, and later reassigned to more conservative portfolios as the beneficiary approaches college age.
PortfolioE.R. % Equity1yr performance
Aggressive 2026/2027 Enrollment Portfolio0.1%20%N/A
Aggressive 2028/2029 Enrollment Portfolio0.1%30%N/A
Aggressive 2030/2031 Enrollment Portfolio0.1%40%N/A
Aggressive 2032/2033 Enrollment Portfolio0.1%50%N/A
Aggressive 2034/2035 Enrollment Portfolio0.1%60%N/A
Aggressive 2036/2037 Enrollment Portfolio0.1%70%N/A
Aggressive 2038/2039 Enrollment Portfolio0.1%80%N/A
Aggressive 2040/2041 Enrollment Portfolio0.1%90%N/A
Aggressive 2042/2043 Enrollment Portfolio0.1%100%N/A
Aggressive Enrolled Portfolio0.09%15%N/A
Moderate 2026/2027 Enrollment Portfolio0.09%15%N/A
Moderate 2028/2029 Enrollment Portfolio0.1%20%N/A
Moderate 2030/2031 Enrollment Portfolio0.1%30%N/A
Moderate 2032/2033 Enrollment Portfolio0.1%40%N/A
Moderate 2034/2035 Enrollment Portfolio0.1%50%N/A
Moderate 2036/2037 Enrollment Portfolio0.1%60%N/A
Moderate 2038/2039 Enrollment Portfolio0.1%70%N/A
Moderate 2040/2041 Enrollment Portfolio0.1%80%N/A
Moderate 2042/2043 Enrollment Portfolio0.1%90%N/A
Moderate Enrolled Portfolio0.08%10%N/A
Aggressive Active Blend 2026/2027 Enrollment Portfolio0.42%20%N/A
Aggressive Active Blend 2028/2029 Enrollment Portfolio0.41%30%N/A
Aggressive Active Blend 2030/2031 Enrollment Portfolio0.39%40%N/A
Aggressive Active Blend 2032/2033 Enrollment Portfolio0.38%50%N/A
Aggressive Active Blend 2034/2035 Enrollment Portfolio0.39%60%N/A
Aggressive Active Blend 2036/2037 Enrollment Portfolio0.36%70%N/A
Aggressive Active Blend 2038/2039 Enrollment Portfolio0.33%80%N/A
Aggressive Active Blend 2040/2041 Enrollment Portfolio0.3%90%N/A
Aggressive Active Blend 2042/2043 Enrollment Portfolio0.27%100%N/A
Aggressive Active Blend Enrolled Portfolio0.32%15%N/A
Moderate Active Blend 2026/2027 Enrollment Portfolio0.32%15%N/A
Moderate Active Blend 2028/2029 Enrollment Portfolio0.42%20%N/A
Moderate Active Blend 2030/2031 Enrollment Portfolio0.41%30%N/A
Moderate Active Blend 2032/2033 Enrollment Portfolio0.39%40%N/A
Moderate Active Blend 2034/2035 Enrollment Portfolio0.38%50%N/A
Moderate Active Blend 2036/2037 Enrollment Portfolio0.39%60%N/A
Moderate Active Blend 2038/2039 Enrollment Portfolio0.36%70%N/A
Moderate Active Blend 2040/2041 Enrollment Portfolio0.33%80%N/A
Moderate Active Blend 2042/2043 Enrollment Portfolio0.3%90%N/A
Moderate Active Blend Enrolled Portfolio0.25%10%N/A

Age-based/Enrollment Year investment options:

Choose between Passive Enrollment Year Portfolios and the Active Blend Enrollment Year Portfolios, each containing 20 portfolios in Aggressive and Moderate glidepaths. Contributions are placed into the portfolio corresponding to the beneficiary's age, and later reassigned to more conservative portfolios as the beneficiary approaches college age.

Static investment options:

Select among three Passive Static Allocation Portfolios and three Active Blend Static Allocation Portfolios; both offer Equity, Balanced, and Fixed Income options, eighteen individual options, and an FDIC-insured option.

Underlying investments:

Vanguard, T. Rowe Price, DFA, Dodge & Cox, BlackRock, Baird Funds, Ariel Investments, Invesco, BNY Mellon, Nuveen, DWS.

Underlying fund allocations:

Portfolio Fees & Performance Lookup

Fees & Expenses

Enrollment or application fee:

None.

Account maintenance fee:

None.

Program management fees:

0.10% (includes 0.025% state administrative fee).
Index Portfolios: 0.07% (no state administrative fee).
No state administrative fee for the Vanguard Federal Money Market 529 and Bank Savings portfolios

Expenses of the underlying investments:

Index Portfolios:
0.02% to 0.34% Age-Based & Static Portfolios (portfolio weighted average)
0.02% - 0.68% Individual Fund Portfolios

None for the High Yield Bank Savings 529 Portfolio and Principal Plus Interest 529 Portfolio. Multi-Firm Portfolios:
0.07% to 0.30% Age-Based & Static Portfolios (portfolio weighted average)
None for the Bank Savings

Total asset-based expense ratio:

0.06% - 0.77% and none for the Principal Plus Interest 529 Portfolio

Taxes and other Benefits

Tax deduction for single filers:

$10,000/yr per beneficiary

Tax deduction for joint filers:

$20,000/yr per beneficiary

Example:

Married filing jointly residents contributing $100/month can expect an additional $59/yr a year in tax savings.

Program match on contributions:

Illinois will automatically deposit a $50 seed deposit into a 529 college savings account for every child born or adopted in the state beginning in 2023.

State tax deduction or credit for contributions:

Contributions to an Illinois 529 plan of up to $10,000 per year by an individual, and up to $20,000 per year by a married couple filing jointly, are deductible in computing Illinois taxable income. For a rollover contribution, only the principal portion is eligible for the deduction. Contribution deadline is December 31 postmark. For tax years ending on or before December 31, 2024, employers may claim a credit against Illinois tax for 25% of matching contributions made to an employee's account in an Illinois 529 plan, with a maximum annual credit of $500 per employee. Unused credits may be carried forward for five years.

Calculate your Illinois 529 tax benefit

Find out how much you can save on state taxes this year by contributing to a Illinois 529 plan.

Your tax savings per year
$59

Household income

$100,000

Monthly Contribution

$100

State tax recapture provisions:

Effective January 1, 2007, rollovers from this plan to an out-of-state program are included in Illinois taxable income to the extent of prior Illinois deductions. Effective January 1, 2009, nonqualified distributions from this plan are included in Illinois taxable income to the extent of prior Illinois deductions.

State definition of qualified expenses

The state's definition of qualified education expenses currently includes expenses for attendance at an institution of higher education as defined by the Internal Revenue Code and its regulations addressing qualified state tuition programs, participation in an apprenticeship program, and interest and/or principal on qualified education loans up to a $10,000 lifetime cap. This does not include tuition for elementary or secondary education. Distributions from a 529 account directly to a Roth IRA are not considered a qualified expense for state income tax purposes.

State tax treatment of qualified distributions:

Qualified distributions from an Illinois 529 plan are exempt. Qualified distributions from a non-Illinois plan are exempt provided the plan meets certain disclosure requirements.

State tax treatment of rollovers:

Illinois follows federal tax-free treatment except that, beginning in 2007, outbound rollovers are subject to the recapture of prior state tax deductions.

Does the sponsoring state exclude the value of an account for state financial aid purposes?

No

Does participation in the program provide beneficiaries with any advantages in qualifying for resident tuition status at state institutions?

No

Is there a rewards program or outside scholarship program that works with this program?

Yes, the Upromise Rewards program can be linked to any 529 college savings plan. Upromise Rewards is free to join and offers members cash back for college.

Statutory protection of an account from creditors:

Distributions & Terminations

To whom are distributions made payable:

Eligible educational institution, beneficiary, or account owner, as directed by the account owner.

Account Changes

Policy regarding participant/owner changes:

Accepts requests to transfer account ownership.

Documents, Access & Reporting

Does participant have online password-protected access to account?

Yes

Can the complete enrollment process including funding be done online?

Yes

Documents and other services accessible or downloadable on the program's public Web site:

Contact

Website:

http://www.brightstartsavings.com

Telephone:

1-877-432-7444

Twitter

http://www.twitter.com/BrightStart529

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