Fees and Expenses
The following table describes the fees and expenses that you pay if you open and contribute to a particular investment option in the Mississippi Affordable College Savings (MACS) Program. These fees are indirectly paid out of the assets of your account. Except for the fees listed below, there are currently no other fees, charges or penalties imposed by or payable to the Plan in connection with opening or maintaining an account. The Board reserves the right to change the current fees, or to impose new or additional fees, expenses, charges or penalties in the future.
| Annual Asset-Based Fees | ||||||
|---|---|---|---|---|---|---|
| Investment Option | Estimated Underlying Mutual Fund Expenses(1) | Program Manager Fee(2) | State Fee(3) | Total Annual Asset-Based Fees(4) | ||
| Managed Allocation Option | ||||||
| Age Band 0-3 Years | 0.15% | 0.50% | None | 0.65% | ||
| Age Band 4-7 Years | 0.15% | 0.50% | None | 0.65% | ||
| Age Band 8-11 Years | 0.16% | 0.50% | None | 0.66% | ||
| Age Band 12-14 Years | 0.16% | 0.50% | None | 0.66% | ||
| Age Band 15-17 Years | 0.18% | 0.50% | None | 0.68% | ||
| Age Band 18 and Over | 0.18% | 0.50% | None | 0.68% | ||
| 100% Equity Option | ||||||
| 0.23% | 0.50% | None | 0.73% | |||
| Guaranteed Option(5) | ||||||
| None | None | None | None | |||
(1) For each Investment Option (with the exception of the Guaranteed Option), the figures in this column are based on a weighted average of the expenses of each underlying Mutual Fund's expense ratio as reported in the applicable Mutual Funds' most recent prospectus available prior to the date of this Supplement No. 3 to the Disclosure Booklet. Each Investment Option that invests in underlying Mutual Funds bears its pro rata portion of the underlying Mutual Funds' expenses because when fees are deducted from an underlying Mutual Fund's assets, the value of the underlying Mutual Fund's shares is reduced.
(2) For its services as Program Manager, each Investment Option (with the exception of the Guaranteed Option) pays TFI a Program Manager Fee equal to the stated percentage of the average daily net assets held by that Investment Option. The Program Manager Fee is the only fee deducted from Program assets. The Program Manager Fee may change at any time. Although there are no fees that are deducted from your Account, when you invest in the Program, you bear a pro rata portion of the Program expenses because when fees are deducted from Program assets, the value of the Program Units is reduced.
(3) Account Owners are not charged any State Fee.
(4) The total annual asset-based fees ("Total Fees") equal the Estimated Underlying Mutual Fund Expenses plus the Program Manager Fee. The portion of Total Fees attributable to the Program Manager Fee is assessed over the course of the year against assets in each Investment Option (with the exception of the Guaranteed Option). The portion of Total Fees attributable to Estimated Underlying Mutual Fund Expenses is borne by each Investment Option as discussed in footnote (1). You should refer to the Investment Cost Example below for the total assumed investment cost over 1-, 3-, 5-, and 10-year periods.
(5) The Guaranteed Option does not pay a Program Manager Fee. TFI does, however, receive from TIAA-CREF Life, the issuer of the Funding Agreement, an annual asset-based fee to pay TFI for distribution, administration and other services that TFI provides for this Investment Option. TIAA-CREF Life may discontinue this fee at any time.
The Program Manager Fee indicated applies on total assets in the Program up to $250 million. The Program Manager Fee will be reduced to 0.45% (45 basis points) if and when total assets in the Program become equal to or greater than $250 million for a period of at least 90 consecutive days. The Program Manager Fee will revert to 0.50%, however, if and when total assets in the Program decrease to below $250 million for a period of at least 90 consecutive days. The Program Manager Fee is subject to further reductions if total assets in the Program reach certain levels.
Investment Cost Example
The example in the following table is intended to help you compare the cost of investing in the different Investment Options over various periods of time. This hypothetical example assumes that:
- You invest $10,000 in an Account for the time periods shown below.
- Your investment has a 5 percent compounded return each year, except for the Guaranteed Option, which is assumed to have a 3 percent compounded return each year.
- You withdraw the assets from your Account at the end of the specified periods for Qualified Higher Education Expenses.
- Total annual asset-based fees remain the same as shown in the Fee Table above.
- The example does not consider the impact of any potential state or federal taxes on the withdrawal.
Although your actual costs may be higher or lower, based on the above assumptions your costs would be:
| Investment Cost Example | ||||
|---|---|---|---|---|
| Investment Option | Approximate Cost of $10,000 Investment |
|||
| One Year | Three Years | Five Years | Ten Years | |
| Managed Allocation Option | ||||
| Age Band 0-3 Years | $67 | $209 | $363 | $812 |
| Age Band 4-7 Years | $67 | $209 | $363 | $812 |
| Age Band 8-11 Years | $68 | $212 | $369 | $825 |
| Age Band 12-14 Years | $68 | $212 | $369 | $825 |
| Age Band 15-17 Years | $70 | $218 | $380 | $849 |
| Age Band 18 and Over | $70 | $218 | $380 | $849 |
| 100% Equity Option | ||||
| $75 | $234 | $407 | $909 | |
| Guaranteed Option | ||||
| $0 | $0 | $0 | $0 | |
The table below indicates that there are no additional fees and expenses deducted from each Account/paid directly by the Participant.
| Additional Fees | ||||
|---|---|---|---|---|
| Percent | Dollars | |||
| Application Fee | 0% | $0 | ||
| Cancellation Fee | 0% | $0 | ||
| Change in Beneficiary | 0% | $0 | ||
| Change in Investment Options | 0% | $0 | ||
| Other Charges as Applicable | 0% | $0 | ||
