Wisconsin consumers looking to save for their children's education can now put their money in a credit union CD that is part of the state's college savings plan.
When consumers sign up for the state's EdVest 529 college savings plan they have the option to invest in the stock market, put their money in a bank CD and now the option to put their money in a credit union CD.
The EdVest program is administered by the Wisconsin Office of the State Treasurer. Consumers can open an account on behalf of a designated beneficiary and contributions to the account are placed in a trust fund established by the State of Wisconsin. A wealth management program was created by the state to manage the assets in the trust fund.
Earnings in the account grow free of federal and Wisconsin state taxes and can be used to pay for qualified higher education expenses.
When consumers choose to put their money in a credit union CD, credit unions put in a bid for the interest rate they can offer. The wealth management program then picks the highest interest rate available for the consumer and the funds go to that credit union.
"So far, a number of credit unions have stepped up, and consumers are requesting a credit union CD. We're very fortunate that this has taken place. It is a great value," said Jim Drogue, vice president of credit union development at the Wisconsin Credit Union League. To date, 15 credit unions have deposits with 712 credit union CDs being opened. The program totals over $5 million in CDs and money available in the accounts for withdrawl.
The overall rate for the portfolio last quarter was around 1.3%, but if a credit union wanted to take a deposit right now for a year, it would pay between 0.75% and 1.00% for a $250,000 deposit. The rate would change for other maturities.
"To credit unions, this means they're again being recognized by the state as a valuable asset to Wisconsin citizens. To consumers, it means they can now indirectly access the most competitive rates offered by Wisconsin credit unions statewide to enhance a long-term investment portfolio," said Brett Thompson, league president/CEO.
The credit union CD is one of 15 investment options available to consumers through EdVest. Since the money in the CD is an investment of the state, the consumer does not have to be a member of the credit union that holds the CD, Drogue explained.
While credit unions can market the program, only people with a specific license are allow to provide details of the program, so the credit union is not responsible for any customer service relating to the program. If credit union members call with questions about the program, the credit union directs them the EdVest Web site, www.edvest.com, or phone number, 888-338-3789.
--lsiegriest@cutimes.com
When consumers sign up for the state's EdVest 529 college savings plan they have the option to invest in the stock market, put their money in a bank CD and now the option to put their money in a credit union CD.
The EdVest program is administered by the Wisconsin Office of the State Treasurer. Consumers can open an account on behalf of a designated beneficiary and contributions to the account are placed in a trust fund established by the State of Wisconsin. A wealth management program was created by the state to manage the assets in the trust fund.
Earnings in the account grow free of federal and Wisconsin state taxes and can be used to pay for qualified higher education expenses.
When consumers choose to put their money in a credit union CD, credit unions put in a bid for the interest rate they can offer. The wealth management program then picks the highest interest rate available for the consumer and the funds go to that credit union.
"So far, a number of credit unions have stepped up, and consumers are requesting a credit union CD. We're very fortunate that this has taken place. It is a great value," said Jim Drogue, vice president of credit union development at the Wisconsin Credit Union League. To date, 15 credit unions have deposits with 712 credit union CDs being opened. The program totals over $5 million in CDs and money available in the accounts for withdrawl.
The overall rate for the portfolio last quarter was around 1.3%, but if a credit union wanted to take a deposit right now for a year, it would pay between 0.75% and 1.00% for a $250,000 deposit. The rate would change for other maturities.
"To credit unions, this means they're again being recognized by the state as a valuable asset to Wisconsin citizens. To consumers, it means they can now indirectly access the most competitive rates offered by Wisconsin credit unions statewide to enhance a long-term investment portfolio," said Brett Thompson, league president/CEO.
The credit union CD is one of 15 investment options available to consumers through EdVest. Since the money in the CD is an investment of the state, the consumer does not have to be a member of the credit union that holds the CD, Drogue explained.
While credit unions can market the program, only people with a specific license are allow to provide details of the program, so the credit union is not responsible for any customer service relating to the program. If credit union members call with questions about the program, the credit union directs them the EdVest Web site, www.edvest.com, or phone number, 888-338-3789.
--lsiegriest@cutimes.com
