Maine’s NextGen 529® Plan

529 Plans Help Families and Friends Invest in Students’ Bright Futures

Grandparents, parents, family members, and family friends play a meaningful role in helping students of all ages to prepare for life after high school. Whether the goal is college, trade school, or another qualifying education path, 529 education savings plans offer a flexible and effective way to invest in a student’s bright future.

There are several ways to use 529 plans effectively, one can open an account, add to an existing one, or leverage gifting strategies.

A 529 education savings plan is designed to help cover the cost of education after high school and can be used for many kinds of educational expenses. Families use 529 plans to pay for two- and four-year degree programs, trade and technical schools, and other qualified programs—both in the U.S. and abroad. Funds can be used for tuition, room and board (for students who are at least half-time), books, supplies and other costs as defined by the Internal Revenue Code.

One of the most attractive features of 529 plans is their tax treatment. Contributions grow tax-deferred, and withdrawals are tax-free when used for qualified education expenses. 1

If the account beneficiary (student) doesn’t need or use all the funds, there are other use options including K-12 education, registered apprenticeships, and student loan repayment for the 529 account beneficiary or their sibling up to $10,000. Contributions can be transferred to another eligible family member as beneficiary. Unused funds from a beneficiary’s 529 account can be transferred to a Roth IRA for that same beneficiary, with limitations. All eligible uses are explained in Section 529 of the Internal Revenue Code.

Maine’s NextGen 529® Plan

Maine’s 529 education savings program, NextGen 529, offers additional incentives that may be especially attractive to Maine residents. If either the account owner or the student beneficiary is a Maine resident, one may be eligible for matching grants for Maine residents.2

More information about Maine’s program is available at NextGenforME.com, including details on eligibility, investment options, and Maine matching grants and the Alfond Grant. For one-on-one help with questions about NextGen 529 and/or the Alfond Grant contact Finance Authority of Maine (FAME) at FAMEmaine.com/contact.

1 To be eligible for favorable tax treatment afforded to any earnings portion of withdrawals from Section 529 accounts, such withdrawals must be used for qualified higher education expenses, as defined in Section 529 of the Internal Revenue Code. Any earnings withdrawn that are not used for qualified higher education expenses are subject to federal income tax and may be subject to a 10% additional federal tax as well as state and local income taxes. State and local tax treatment of distributions for certain qualified higher education expenses may differ. Please consult your tax advisor for specific advice regarding such distributions.

2 Grants for Maine residents are linked to eligible Maine accounts. Upon withdrawal, grants are paid only to institutions of higher education. See Terms and Conditions of Maine Grant Programs at NextGenforME.com for other conditions and restrictions that apply. Grants may lose value.

Investing is an important decision. The investments in your account may vary with market conditions and could lose value. Carefully read the Program Description in its entirety for more information and consider all investment objectives, risks, charges, and expenses before investing. For a copy of the Program Description, visit NextGenforME.com or call 1-833-336-4529.

Investments in NextGen 529 are not guaranteed or insured by the State of Maine, the Finance Authority of Maine (FAME), NextGen 529 service providers, any other state or federal agency, or any other party. Non-qualified withdrawals are subject to federal taxes and penalties and Maine state income tax. NextGen 529 does not provide legal, investment, financial aid, tax or other advice, and the information provided does not contain advice and cannot be construed as such or relied upon for those purposes. You should consult your own advisors.

If you or your beneficiary are not Maine residents, your home state or that of your beneficiary may offer a 529 plan that provides state tax or other benefits, such as financial aid, scholarship funds, and protection from creditors, not available to you by investing in NextGen 529. You should consider such benefits, if any, before investing in NextGen 529.

NextGen 529 is a Section 529 plan administered by FAME. Vestwell State Savings, LLC is the program manager, The Bank of New York Mellon is the program custodian, BlackRock Advisors, LLC is the program investment manager. BlackRock Investments, LLC, Member FINRA, is the program distributor and underwriter for the Client Select Series only. Northern Lights Distributors, LLC, Member FINRA, is the program distributor and underwriter for the Client Connect and Client Direct Series. Merrill Lynch, Pierce, Fenner & Smith Incorporated (Merrill), a registered broker-dealer, registered investment adviser, Member SIPC, is the NextGen 529 Direct Series recordkeeping agent. BlackRock Advisors, LLC is an affiliate of BlackRock Investments, LLC; the other service providers to NextGen 529 are not affiliated with each other.