For Immediate Release
August 14, 2017
Treasurer Torsella Announces Financial Results for PA 529 Guaranteed Savings Program Accounts
Double-digit gains strengthen fund, now 116% funded; Lowers return assumption to prudent 6% going forward
Harrisburg, PA – Pennsylvania Treasurer Joe Torsella today provided a financial performance report on PA 529 Guaranteed Savings Program’s (PA 529 GSP) investment report for fiscal year 2016-17, and outlined adjustments going forward. Among the report’s highlights was the news that PA 529 GSP investments earned over a 10% return this past fiscal year, the program is more than fully funded (116%) on an actuarial basis, and the long-term rate of assumption has been lowered from 6% to put the fund on even sounder financial footing going forward.
“I am pleased to announce the tremendous success Treasury is experiencing through our 529 College Savings Program, particularly that of the PA 529 GSP. Families all across the commonwealth are making every day sacrifices to ensure their child has an opportunity to pursue higher education and graduate with a reduced debt load. I want those families to know that we are investing their money wisely. The GSP continues to be a great deal for Pennsylvania families, guaranteeing you can lock in tomorrow’s tuition bills – at any school across the nation – at today’s prices.”
Pennsylvania Treasurer, Joe Torsella
At the Pennsylvania 529 College Savings Program’s quarterly Advisory Board meeting, Treasurer Torsella provided an actuarial update as of June 30, 2017 noting that the PA 529 GSP is 116% funded on an actuarial basis. Additionally, in consultation with the program’s investment advisors and actuary, Treasurer Torsella lowered the PA 529 GSP’s assumed rate of return from 7% to 6%. While the fund’s actual performance exceeded its current assumption in the past fiscal year, the new rate of return assumption reflects expected returns given today’s asset prices. “This more conservative return assumption will help ensure the financial health of this fund, and should give parents peace of mind.”
The Pennsylvania 529 College Savings Program provides one of the best ways to save for higher education through two distinct plans – the PA 529 GSP and the Pennsylvania 529 Investment Plan (PA 529 IP). The PA 529 GSP is a simple, lower-risk way to help savings keep pace with rising tuition. Growth on a PA 529 GSP account is based on tuition inflation rather than financial markets. When used for qualified higher education expenses, growth is not subject to federal or Pennsylvania income taxes and Pennsylvania taxpayers can deduct contributions from the Pennsylvania taxable income up to $14,000 per year, per beneficiary, within limits.
Current and future college students in Pennsylvania have over $4.3 billion saved for higher education, between both PA 529 College Savings Plans.
To learn more about the PA 529 College Savings Program including important disclosure, or to open an account, please visit PA529.com.
The Pennsylvania 529 College Savings Program sponsors two plans-the Guaranteed Savings Plan (GSP) and the Investment Plan (IP). The guarantee of the PA 529 Guaranteed Savings Plan is an obligation of the GSP Fund, not the Commonwealth of Pennsylvania or any state agency. To learn more about the GSP and IP, please read the disclosure statements by visiting www.pa529.com or calling us at 1-800-440-4000 to learn more about the plans including investment objectives, risks, fees, and tax implications.
Debra Tingley, (717) 787-2991 or email@example.com
The Pennsylvania Treasury is an independent department of state government led by the state treasurer, who is elected every four years. The department's primary duty is to safeguard and manage the state's public funds. It invests state money to generate income on behalf of the citizens of Pennsylvania, reviews and processes payments for state government agencies, and serves as custodian of more than $100 billion in state funds. Key Treasury programs include Unclaimed Property, PA 529 College Savings Program and the Board of Finance and Revenue.