Nebraska's 529 Plan Launches FDIC-Insured Savings Option

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Oct 17, 2011, 07:10 ET

LINCOLN, Neb., Oct. 17, 2011 /PRNewswire/ -- First National Bank of Omaha (FNBO), the Nebraska Educational Savings Trust (NEST), and Nebraska State Treasurer Don Stenberg announced today the launch of the Bank Savings Investment Option, Nebraska's FDIC-insured 529 savings option. NEST is Nebraska's 529 college savings plan (previously named College Savings Plan of Nebraska) of which the State Treasurer serves as the Trustee and First National Bank of Omaha serves as Program Manager. Today's announcement follows the August 17, 2011, announcement by State Treasurer Don Stenberg regarding the Nebraska Investment Council's approval of this new investment option.

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The Bank Savings Individual Investment Option is a low-cost investment option that is not subject to stock market fluctuation, making it a suitable choice for families seeking stability of principal, low risk, and locked-in earnings. Additionally, conservative investors, low- to moderate-income families, grandparents, and families with children at or near college age will find this option beneficial, since it is FDIC-insured up to $250,000 when combined with any other account owner holdings at the First National Bank of Omaha.

The Bank Savings Individual Investment Option is affordable with no minimum contribution, balance, or holding period; no withdrawal fees; a low 0.20% total annual asset based fee; and no advisor fees in the NEST Advisor Plan. The new option also offers competitive interest rates with a current 0.80% APY. This rate will change over time and is compounded daily and credited on a monthly basis less the total annual asset based fee.

"When First National Bank assumed the role of Program Manager last year, we made a commitment to making saving for college easy and affordable for all families, said Deborah Goodkin, Managing Director, College Savings Plans at First National Bank of Omaha. "The Bank Savings Individual Investment Option is just one example of that commitment by providing families with a safe, low cost investment vehicle to help fund their children's education."

Goodkin also mentioned that the Bank Savings Individual Investment Option is a great solution for grandparents who want guaranteed funds available for their grandchildren when they enter college. Additionally, many banks no longer will sell paper US Savings Bonds (effective January 1, 2012), which many grandparents have traditionally purchased for their grandchildren's education, making the Bank Savings Individual Investment Option an excellent alternative.

State Treasurer Stenberg said the new option provides a very conservative, safe investment choice for parents, particularly those whose children are nearing college age or are already in college, and for grandparents who are seeking secure investment opportunities for their grandchildren's educational expenses. "This will be a much appreciated option to make sure funds for their children's or grandchildren's education are secure and federally insured," he said.

"I first made this proposal last year during my campaign for Nebraska State Treasurer," Stenberg said. He said that during his campaign he heard from many parents and grandparents who were seeking secure investment options for college savings.

Owners of the Bank Savings Individual Investment Option will also enjoy the same conveniences of any other NEST 529 plan including all federal and state tax advantages; the ability to transact and maintain investments online, over the phone or by mail; and track investment progress online through secure account access, on confirmations and quarterly statements.

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, NEST Advisor College Savings Plan, TD Ameritrade 529 College Savings Plan, and The State Farm College Savings Plan. The Nebraska State Treasurer serves as the Program Trustee. First National Bank serves as the Program Manager, and all investments are approved by the Nebraska Investment Council. Currently, more than 52,000 families in Nebraska and over 180,000 nationwide are saving for their children's higher education through NEST. For more information, visit www.NEST529.com or www.treasurer.org.

First National Bank is a subsidiary of First National of Nebraska. First National of Nebraska has grown into the largest privately owned banking company in the United States. First National and its affiliates have $17 billion in managed assets and nearly 5,000 employee associates. Primary banking offices are located in Nebraska, Colorado, Illinois, Iowa, Kansas, South Dakota and Texas.