LANSING – The Michigan Department of Treasury has approved a plan that will help families pay even less to invest for higher education and technical job training through the Michigan Education Savings Program (MESP).
Management and servicing fees have dropped 26 percent and now range from .20 percent to .30 percent annually, depending on investment choices. That translates to between $2 and $3 annually for every $1,000 invested. The fee reduction, effective Nov. 14, 2012, is the result of negotiations this year between MESP program manager TIAA-CREF Tuition Financing, Inc., and Michigan State Treasurer Andy Dillon.
“We know that college and technical training are increasingly important, and the Michigan Education Savings Program is helping tens of thousands of Michigan families with their savings,” said Dillon. “By negotiating hard to get the best fees possible, we are helping to stretch Michigan families’ money even further.”
In addition to lower fees, MESP has been enhanced with the addition of two more investment options, providing investors with a wider array of choices with varying strategies and degrees of risk. New to the plan are the International Equity Index Option, which seeks to provide a favorable long-term total return – mainly through capital appreciation – by investing in international and emerging markets index funds, and the U.S. Equity Index Option, which invests 100 percent of its assets in one index fund and attempts to track a benchmark index.
Each decline in fees makes the MESP plan more affordable, which is a bit of good news for families facing rising education costs. In 2011-12, in-state tuition and fees at the nation’s public, four-year colleges increased at an average rate of 8.3 percent from the previous year – higher than the general inflation rate, according to a July 2012 analysis by the College Board Advocacy & Policy Center (“Trends in Tuition and Fees, Enrollment, and State Appropriations for Higher Education by State.”
In Michigan, tuition increases at public universities rose 6.9 percent in 2011-12 from the previous year, according to the College Board analysis.
To learn more about MESP, visit Misaves.com or contact us at 877-861-6377.