The fee for investments in the state-managed “College Savings Iowa” program have been reduced. State Treasurer Michael Fitzgerald says the fee has now dipped to one-fifth of one percent.
“This is the seventh decrease in price we’ve been able to initiate over the last 10 years,” Fitzgerald says.
The fees have fallen 65 percent over the past decade, primarily because administrative costs have remained steady, while participation has increased dramatically.
“We take great pride in having a low-cost, professionally-managed college fund,” Fitzgerald says. “…We’re up to over $4.2 billion in the fund. We have over 240,000 accounts and that speaks for itself that people love it.”
The reduced investment fee took effect January 1. It means investors each year pay only $2 for every $1000 invested.
“We want the message to get out to all corners of the state of Iowa, to every parent and grandparent because a third of the people that own these accounts are grandparents. They’re the ones that have the money,” Fitzgerald says. “The bigger we can get the fund, with more people in it, we can pass the savings on to Iowans. And that’s what we’re doing.”
The governor and legislators created the College Savings Iowa program in 1998. In the past decade, investments in the fund have nearly quadrupled. The fund is only open to Iowa taxpayers.