529 College Savings Plan By State

Welcome to 529 College Savings Plan By State! We have everything you need to make your life easier as you begin your search for the best 529 College Savings Plan. State specific 529 plan details, contact information, step-by-step application process, and savings tips to help you achieve your college savings goals.

529 plan by state

What is the Bright Start College Savings?
Illinois 529 Plan Explained

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Bright Start is a 529 college savings plan administered by the state of Illinois.  Designed to let you save and invest for your student’s education, you’ll enjoy tax-free distributions on your original contributions as well as your earnings.

The Bright Start plan is open to Illinois residents as well as residents of any of the 50 states.  Illinois residents, however, do get an additional tax benefit, which we’ll outline below.

Getting Started is Easy

If you’re not familiar with how a 529 plan works, think of it as an investment vehicle that you or any of your friends and relatives can use to grow your money for your student’s education.  As you make contributions, your money will grow and can be distributed for qualified educational expenses on a tax-free basis, saving you hundreds, if not thousands of dollars in taxes. what is bright start college savings

You can enroll online in about 15 minutes and start with as little as $25.  Ongoing contributions can be as little as $15 at time.  You can also request paperwork and mail it in by calling 877-432-7444.

What You’ll Need to Start

When you’re ready to open an account, you’ll need to have the following:

  • Names, addresses and social security number of account holder and beneficiary,
  • Bank information if you want to make automatic contributions from your bank.

Be sure to ask your employer if they are able to deduct the contribution directly from your checks and send them right to your Bright Start account.

Bright Start Investment Options

With over $2 billion in assets, the Bright Start Illinois 529 College Savings plan is able to provide top quality investments with very low fees.  The investment options are provided through:

  • Oppenheimer Funds
  • Vanguard Group
  • American Century Investments

The Wall Street Journal once praised the Bright Start plan for having “high rated funds and low expenses.”  The expense ratios (or fees) range from 0.18 to 0.68, so more of your money goes towards your future and not into fees.

You can choose an index strategy, blended investment strategy or a combination of both.

Blended strategies include both actively managed and index funds.

Index funds provide exposure the market and trends the performance of major indexes such as the S&P 500.  You’ll have lower fees, since it’s not actively managed.

You can also select among the age based options or choice based portfolios.  Age based portfolios automatically shift towards a more conservative investment allocation as your beneficiary nears college age.

Bright Start also provides a principal protection program that includes an insurance-based product to protects your principal against market loss.

Tax Benefit with Bright Start

You’ll pay no federal or state income tax on earnings within your 529 plan as long as you use the withdrawals to pay for qualified educational expenses.  These include but aren’t limited to: tuition, room and board, books, supplies, computers, and even transportation expenses.

As an Illinois resident, you can deduct up to $10,000 from your state taxes if you are single and you can deduct up to $20,000 annually from your state taxes if you’re married filing jointly.

If you use the funds for unqualified expenses, you’ll be subjected to a 10% penalty.

Whether you’re a resident of Illinois or not, you should definitely consider the Bright Start 529 plan as an option in your college savings strategy.

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