Designating a Beneficiary

Who Can Be a Program Beneficiary?

Anyone who has a valid federal taxpayer identification number, such as a social security number, can be a program beneficiary. A beneficiary need not be a resident of the State of Illinois, and the program does not have any age limits for a beneficiary. An account owner may also name himself or herself as the beneficiary.

Each account may have only one designated beneficiary, but account owners may establish separate accounts for the same beneficiary, provided that the total balances in the accounts, and all other accounts for the beneficiary in other Illinois Section 529 programs, do not exceed $320,000.

If an account is established by a state or local government (or agency or instrumentality thereof) or an organization described in Section 501(c)(3) of the Internal Revenue Code as part of a scholarship program operated by such government or organization, the beneficiary is not required to be identified at the time the account is established. The government or organization will designate the beneficiary prior to any distributions from the account for higher education costs.

Investment Products: Not FDIC Insured. No Bank Guarantee. May Lose Value

The Bright Directions College Savings Program is part of the Illinois College Savings Pool and is designed to qualify as a qualified tuition program under the provisions of Section 529 of the Internal Revenue Code. The Bright Directions College Savings Program is sponsored by the State of Illinois and administered by the Illinois State Treasurer, as Trustee. Union Bank & Trust Company serves as Program Manager, and Northern Trust Securities, Inc. acts as Distributor.

You should be aware that other states may sponsor their own qualified tuition plans and may offer a state tax deduction or other benefits that are limited to residents who invest in that plan. You should consult with a tax advisor about state and local taxes.

Withdrawals used to pay for qualified higher education expenses are income TAX-FREE (Federal and State of Illinois). Qualified higher education expenses include tuition, fees, books, supplies and equipment required for enrollment at a qualified institution of higher education. Room and board is considered a qualified higher education expense if the student is enrolled on at least a half time basis.

Every individual's tax situation is different, and it is important to consult a qualified tax advisor regarding the application of the Program’s benefits to your own individual situation.

There is no guarantee that any investment portfolio will achieve its investment goals. The value of an account will go up or down based on the performance of the Portfolio in which the account is invested. When funds are withdrawn, they may have more or less than the total contributions made to the account. Past investment performance is no guarantee of future results.

Investments in the Bright Directions College Savings Program are not guaranteed or insured by the State of Illinois, the Illinois State Treasurer, Union Bank & Trust Company, Northern Trust Securities, Inc., the Federal Deposit Insurance Corporation or any other entity. Investors should read carefully and consider the investment objectives, risks, fees, and expenses contained in the Program Disclosure Statement (issuer's official statement) before investing. The Program Disclosure Statement, which contains additional information about the plan and municipal fund securities, is available from your financial advisor.