New Jersey 529 Plan Lowers Fees, Adds Conservative Funds

New Jersey's Higher Education Student Assistance Authority reached an agreement to reduce administrative fees and offer more conservative investments for the NJBEST 529 college savings plan.

The Star-Ledger in Newark reported that by December, the program’s annual management fee, which pays for the services of Franklin Templeton Investments, will be reduced by 50%, saving $800,000. In addition, the plan will offer two new age-based investment options: Conservative Age-Based Portfolios and Moderate Age-Based Portfolios, the authority said.

The existing age-based portfolios will be renamed Growth Age-Based Portfolios, according to the news report.

Franklin Templeton agreed to absorb nearly $200,000 in costs to implement the changes.

The plan has been criticized by Morningstar for charging high fees and for having age-based portfolios that are too risky for students close to attending college (see “Ohio 529 Plans: Both the Best and the Worse”).