Nearly 16,000 Maine families will receive over $4.2 million in grants
The Finance Authority of Maine (FAME) announced today that 2015 was a record-breaking year for Maine residents who received matching grants based on their contributions to a NextGen College Investing Plan® account.
“It was a banner year, with nearly 16,000 families receiving grants for higher education,” said Bruce Wagner, CEO of FAME. “FAME is investing in the future of Maine by helping families attain their higher education goals. We believe we are on the cusp of an exciting new era of expanded college savings in Maine,” he added. “More Mainers than ever are saving for higher education, opening approximately 5,000 new NextGen® accounts each year.”
According to research published in the American Journal of Education, children with college savings are six times more likely to go on to college, and low-income students with just $500 or less in college savings are four-times more likely to graduate¹. Research shows that a higher education attainment translates into more job opportunities², better health³ and less unemployment³.
Wagner attributes the recent success in Maine to a variety of factors, designed to inspire Maine families to invest in their children’s future. FAME was able to increase the 50% NextStep Matching Grant maximum annual match per year from $100 to $300 and to increase the Automated Funding Grant, a one-time grant, from $50 to $100 for eligible accounts that have automatic contributions set up through payroll deduction or from a checking or savings account.
“We’d been intending to open NextGen accounts and start contributing regularly for a couple years. Once we heard about the expanded grants, we wasted no more time and opened accounts for our two children. The grants are a great bonus,” said NextGen account owner Brian Farr.
Another prominent factor is the $500 Harold Alfond College Challenge Grant (Alfond Grant), which is now universally available to resident Maine babies. The Alfond Scholarship Foundation automatically invests $500 for every baby born a Maine resident for future higher education expenses4
. NextGen accounts for children awarded the $500 Alfond Grant may be opened without making an initial contribution. No matter how a NextGen account is opened, either with the Alfond Grant or with an initial contribution, eligible Maine accounts can receive the annual NextStep Matching Grant, and the Automated Funding Grant (See Terms and Conditions for Maine Grant Programs
for further details).
“FAME’s working relationships with Merrill Lynch, Pierce, Fenner & Smith Incorporated, the program manager, and the Alfond Scholarship Foundation are the foundation for building an exciting new culture of investing in the future of Maine. With help from other interested organizations like employers, schools and colleges, we feel confident that together we can increase awareness of the power of higher education and help change the future of Maine,” said Wagner.
“We know that helping our customers and employees invest in their families can be powerful. And encouraging higher education for them makes sense for our future and theirs. So we let as many families as we can know about NextGen and college savings as a benefit for all Maine residents – including children and adult learners,” said Melissa Moffett, VP Customer Service, Machias Savings Bank.
FAME is pleased to announce other 2015 highlights, including:
- Nearly 45,000 Maine children are the beneficiaries of NextGen accounts
- Nearly 14,000 Maine accounts made contributions this year, and 29,560 Maine families have been awarded matching grants for annual contributions since the inception of matching grants in 2002
- Approximately 1,400 Maine families started auto-funding their accounts in 2015 and received the $100 Automated Funding Grant
FAME understands that setting aside money for higher education can be difficult for many families, but it is important to remember that every dollar in a college investing account at tuition time is one that does not need to be borrowed and repaid with interest later. “The amount that someone sets aside may be less important than the actual act of regularly investing in your child’s future,” said Wagner. For more information on NextGen, please visit NextGenforME.com
¹Elliott & Beverly, 2011; American Journal of Education.
²The Georgetown University Center on Education and the Workforce 2010
³U.S. Census Bureau
Children born as Maine residents since January 1, 2013 or who are Maine residents at account opening and under the age of one. The Alfond Grant is not automatic in all circumstances and is also available in limited other circumstances. The use of the Alfond Grant is also subject to certain restrictions ‐ see Guidelines at 500forbaby.org
NextGen is a Section 529 plan administered by the Finance Authority of Maine (FAME). Before you invest in NextGen, request a NextGen Program Description from your Merrill Lynch Financial Advisor or Maine Distribution Agent or call Merrill Edge at 1-877-4-NEXTGEN (877-463-9843) and read it carefully. The Program Description contains more complete information, including investment objectives, charges, expenses and risks of investing in NextGen, which you should carefully consider before investing. You also should consider whether your or your designated beneficiary’s home state offers any state tax or other benefits that are only available for investments in such state’s Section 529 plan. Merrill Lynch, Pierce, Fenner & Smith Incorporated, a registered broker-dealer, member SIPC, is the program manager and underwriter.