Oklahoma s 529 College Savings Plan (OCSP)

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1 Oklahoma s 529 College Savings Plan (OCSP)

2 An investment in knowledge pays the best interest. Benjamin Franklin 2

3 The Cost of Tuition & Fees Use our College Planning Calculator to explore different scenarios to achieve your college savings goals. Based on average published tuition and fees for as reported by The College Board and assumed to increase 6% annually. This is a hypothetical example for illustrative purposes only.

4 A Wise Investment On average, individuals with bachelor s degrees earn an additional $1 million over a working life time above those with only high school diplomas.* Median annual income data is based on the U.S Bureau of Labor Statistics. Current Population Survey was updated as of March *Total accumulated earnings over 50 years from age 20 to age 69 ** A doctoral or professional degree is the highest degree offered in a field of study, be it medicine, law, engineering, etc. 4

5 The Advantages of Starting Early

6 Experienced Plan Manager TIAA Founded 100 years ago by one of history s great philanthropists, Andrew Carnegie, TIAA is committed to helping institutions and individuals pursue positive outcomes through an array of global, diversified financial services and a long-term investment perspective. $1 Trillion in AUM* TIAA-CREF Tuition Financing, Inc. (TFI) Affiliate of the TIAA-CREF group of companies Plan Manager for OCSP since April 2000 Industry leader in managing 529 State 529 College Savings P Programs since 529 plans launched in 1999 *Based on assets under management across Nuveen Investments affiliates and TIAA investment teams as of December 31, 2017.

7 TFI, launched in 1999, serves 9 states 3

8 OCSP Oklahoma s direct-sold 529 plan managed is by the TIAA- CREF Tuition Financing, Inc., and overseen by a Board of Trustees chaired by the Oklahoma State Treasurer More than $850 million in assets Did you know? OCSP allows for contributions up to $300,000 per beneficiary. More than 50,000 accounts* More than $439 million in qualified withdrawals on behalf of almost 21,000 students OK4saving.org As of December 31, 2017 *Based on Unique Owner-Beneficiary Relationship

9 With few exceptions, there are no limitations on account owners or beneficiaries.

10 Tax Advantages Account contributions are made after-tax. Contributions can reduce your Oklahoma taxable income each year up to $10,000 per individual or $20,000 per married couple. (See the Disclosure Booklet for details.) Did you know? Oklahoma provides a five-year carryforward for excess contributions. Any earnings have the opportunity to grow: Tax-deferred Any account earnings grow tax-deferred Tax-free Withdrawals of any earnings for qualified education expenses are free of federal and Oklahoma state income tax

11 Estate Planning/Gifting Estate Planning Benefits Contributions are considered a completed gift and are eligible for the annual $15,000 gift tax exemption A $75,000 one-time gift may be prorated over five years All contributions are removed from the taxable estate Completed gift to the beneficiary $15,000 per beneficiary per year $30,000 per married couple Give up to five years ($75,000/$150,000 per couple) in one year to as many individuals or beneficiaries as you like OCSP accounts are not subject to the Kiddie Tax

12 Low Fees Total annual plan fees are under 100 basis points for every investment option. No application fee Did you know? OCSP is among the lower cost 529 plans in the country. No transfer fee No commissions paid on accounts No sales fees No annual account maintenance fee Review the Plan Disclosure Booklet or visit OK4saving.org for a list of fees and descriptions.

13 Who can I contribute for? Beneficiaries may include: Your child Your grandchild or great-grand child Your niece or nephew Your friend or other relative Yourself

14 Flexible Choices OCPS funds can be used at eligible education institutions nationwide (and many abroad), including; College University Technical Colleges Any type of degree or certificate program Graduate degrees included The tax plan signed into law on 12/22/17, now allows distributions to be used for K-12 school tuition, up to $10,000 annually per student from all 529 Plans.

15 Ease in using the account The account can be used for a variety of qualified expenses, including: Tuition Mandatory Fees Did you know? Computers are considered a qualified expense if required for a course (excludes K-12) Certain Room and Board Costs* Books Mandatory Equipment and Supplies K-12 withdrawals include Tuition ONLY * Student must be enrolled half the time of a full time course of study. See the Disclosure Booklet for more information.

16 Non-Qualified Withdrawals The earnings portion, if any, of non-qualified Withdrawal due to death, disability, or receipt of scholarship or attendance at a Military Academy by the designated beneficiary is subject to applicable federal and state income tax, if any. The earnings portion, if any, of a non-qualified Withdrawal not due to death, disability or receipt of scholarship or attendance at a Military Academy is subject to applicable federal and state income tax, plus a 10% additional federal tax.

17 Easily access your account Only the account owner can take a withdrawal. Withdrawals can be requested - By Form - Online - Smartphone A withdrawal can be sent directly to: - Account Owner - Institution - Beneficiary/Institution Receipts are not required to withdraw funds. Account owners should maintain records of their withdrawals and keep their receipts.

18 Wide range of investment options Nine different investment options to choose from. You can select one or any combination that best meets your investment objectives. Age-Based - Moderate Managed Allocation - Conservative Managed Allocation - Aggressive Managed Allocation Multi-Fund - Diversified Equity Option - Global Equity Index Option - Balanced Option - Fixed Income Option Single-Fund - U.S. Equity Index Option Capital Preservation - Guaranteed Option

19 Age-Based Investment Option Example Sample allocation of an age-based portfolio designed for a child age 0-3* *Risk level shifts from aggressive to conservative as the beneficiary ages. Allocations automatically change over time. For illustrative purposes only. Refer to the Disclosure Booklet for the underlying mutual fund allocations for each Age-Based Option.

20 Diversified Equity Option Risk Level: Aggressive Investment Strategy: Invests in multiple mutual funds that are actively Managed. Global Equity Index Option Risk Level: Aggressive Investment Strategy: Invests in four mutual funds. Three of the mutual funds are considered index funds, meaning that the mutual fund attempts to track a benchmark index. The remaining mutual fund is actively managed. Refer to the Disclosure Booklet for the underlying mutual fund allocations for each of the above investment options.

21 Balanced Option Risk Level: Moderate Investment Strategy: Invests in multiple mutual funds with an approximate 60% allocation to equity funds and 40% to bond funds. Seeks to provide a favorable return that reflects the broad investment performance of the financial markets. Fixed Income Option Risk Level: Moderate Investment Strategy: Invests in 100% of its assets in mutual funds that invest primarily in debt securities. Refer to the Disclosure Booklet for the underlying mutual fund allocations for each of the above investment options.

22 U.S. Equity Index Option Risk Level: Aggressive Investment Strategy: Invests 100% of its assets in one index fund meaning that the fund attempts to track a benchmark index. Capital Preservation Option Guaranteed Option* - Assets allocated to a funding agreement - Issued by TIAA-CREF Life Insurance Company (TIAA-CREF Life) - Current rate of 1.60% until March 31, 2018

23 Choosing your Investment Option Choose an investment option based on your time frame and risk tolerance Risk tolerance questionnaire available at ok4saving.org You may choose more than one investment option or a different investment option at anytime You may transfer funds from one investment option to another twice per calendar year

24 Easy to get started Go to OK4saving.org for easy, online opening. Open for as little as $100, with: - Checks - Electronic Bank Transfer - Automatic Contribution Plan - Payroll Deduction/Direct Deposit, if employer allows - Gifts from family members and friends - Account owners need beneficiary name and date of birth, Social Security Number or federal Taxpayer Identification Number

25 Important Disclosures Consider the investment objectives, risks, charges and expenses before investing in the Oklahoma College Savings Plan. Visit ok4saving.org, or call the Plan, for a Disclosure Booklet containing this and other information. Read it carefully. Check with your home state to learn if it offers tax or other benefits such as financial aid, scholarship funds or protection from creditors for investing in its own 529 plan. Consult your legal or tax professional for tax advice, including the impact of the new federal tax changes. Investments in the Plan are neither insured nor guaranteed except for TIAA-CREF Life Insurance Company s guarantee to the Oklahoma College Savings Plan under the Funding Agreement for the Guaranteed Option, and there is a risk of investment loss. Account values will fluctuate based on a number of factors including general market conditions. Withdrawals that are not used for qualified higher education expenses may be subject to federal income tax and any applicable state income tax, as well as an additional 10% federal tax. TIAA-CREF Tuition Financing, Inc., Plan Manager. TIAA-CREF Individual & Institutional Services, LLC, Member FINRA and SIPC, distributor and underwriter for the Oklahoma College Savings Plan