How does CDSC work?
A contingent deferred sales charge (CDSC) is a fee, sales charge or load, which mutual fund investors pay when selling Class-B fund shares within a specified number of years from the original purchase date. … The financial industry usually expresses a CDSC as a percentage of the dollar amount invested into a mutual fund.
Class 529-E Shares
- Available only through employer-sponsored 529 plans.
- No Sales Charge. Class 529-E shares, which can be offered in eligible employer-sponsored college savings plans, do not have an up-front or contingent deferred sales charge.
- Annual Expenses. …
- Maximum Investments. …
- Fund Purchase Restrictions.
What is the difference between 529 A and 529 C?
Investors who purchase Class A shares typically pay an upfront sales charge and lower annual fees compared to other 529 plan share classes. … Class C shares do not have a front-end sales charge, but come with higher annual fees, often making them a better choice for investors with a shorter time horizon.
Does CDSC apply to reinvested dividends?
Increases in the value of your shares or shares acquired through reinvestment of dividends or distributions are not subject to a CDSC. The amount of any CDSC will be paid to and retained by the Distributor.
What is CDSC annuity?
If you withdraw money from an annuity contract or surrender the contract within a certain period of time after investing, the insurance company may assess a contingent deferred sales charge (CDSC). Usually, the CDSC is a percentage of the purchase payment withdrawn, and it declines gradually over the CDSC period.
What are typical 529 fees?
The average upfront fee for class A 529 plans sold by brokers is as much as 5.75%, according to Paul Curley, director of college savings research at consulting firm Strategic Insight. For those accounts, the average annual fee is about 1% of the account balance.
What can I spend 529 money on?
Money from a 529 account can be used for major post-secondary education costs such as: Required tuition, fees, books, supplies and equipment. Certain room and board expenses, which may include food purchased directly through the college or university (for the stipulations of off-campus living — see below)
How much can a parent contribute to a 529 per year?
Annual 529 plan contribution limits
529 plans do not have annual contribution limits. However, contributions to a 529 plan are considered completed gifts for federal tax purposes, and in 2019 up to $15,000 per donor, per beneficiary qualifies for the annual gift tax exclusion.
Do 529 plans have fees?
With almost any 529 plan, the investor pays annual mutual fund fees. … If you instead invest in a 529 plan with a 0.10% expense ratio you would only pay $100 fees that year. And remember, a 529 plan’s annual expense ratio is based on a percentage of assets in the account.
Who is in charge of a 529 plan?
Generally, the same person who contributed the money controls the Section 529 account. This doesn’t have to be the case, however. Someone else, such as a grandparent, could make a donation but name the child’s parent as the account owner, or a parent could establish the account and allow others to contribute to it.