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Kim Butler

Partners for Prosperity, Inc.

City:Mt. Enterprise

State: TX

I have 20+ years of handling alternative investments in cash, growth and income for clients nationwide.  I strive to help my clients with all things financial in every way possible over the phone and the web.  I own an alpaca farm which I enjoy working during my downtime.  I also enjoy gardening, writing and reading books.  I also train other advisors on Prosperity Economics.

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Mutual Fund a Unique Vehicle for Saving for College

Investors can earn up to a full year's tuition at participating colleges and universities

| BY Donald Liebenson

The Orion-Monetta Intermediate Bond Fund (MIBFX) offers the opportunity for an investment win-win for parents concerned about funding their child’s college education. In a unique initiative in partnership with SAGE Scholars Tuition Rewards® Program, parents can earn up to a full year’s tuition at more than 300 participating private colleges and universities in 45 states when they invest in this mutual fund.

More than half of Millionaire investors under the age of 55 are concerned about being able to finance their children’s education, according to a first quarter wealth level study of Millionaire households conducted by Spectrem’s Millionaire Corner.

Another report released earlier this year found that half of Americans are not saving for college, and the half that do represents a decline in percentage from two years ago. Of those who are saving for college, just over one-fourth (27 percent) are using a 529 college savings plan. But 42 percent are using general funds or certificates of deposit, and are missing out on the tax incentives offered by a 529 account, according to Sallie Mae’s “How America Saves for College 2013” (click here to read more).

Investors in the Orion-Monetta Intermediate Bond Fund accrue tuition reward points—each worth $1 in guaranteed minimum scholarships--from a participating school that can generate discounts for up to one full year of tuition from that school.  Each registered student will receive non-transferrable points every year on his/her birthday. Children (or designated grandchildren, nieces, nephews or godchildren) ages 1-11 earn 500 points, ages 12-14 earn 750m and ages 15-17 earn 1,000. Further, new investors will receive a one-time bonus of 500 tuition reward points when they register. There is no cost to enroll.

The accrual of tuition credits is 5 percent of the account annually. If, for example, the account was worth $100,000 at the end of the first year, the beneficiary would be credited with $5,000 in tuition credits. If it was worth $105,000 at the end of the second year, the beneficiary would be credited with an addition 5 percent of that total.

The money earned from the program can be amortized as payment throughout the years of enrollment and cannot be used to fund one free year of college to avoid participants transferring schools after that one free year.

The Sage Scholars program is for private, not-for-profit colleges and universities only. Participating schools include: DePaul University and Lake Forest College in Illinois, Ohio Wesleyan University, and Creighton University in Nebraska. Click herefor a list of participating schools.

The program, observed George Palmer, executive vice president at Orion-Capital Management, a fee-based RIA in Winnetka, which is the sub-advisor for MIBFX, “is aimed at middle and upper income people who are savers and investors, and who are willing to look down the road (and get a head start on saving for college).”

The tuition reward points are similar to a frequent flyer miles program” Palmer said. They do not affect other scholarships or financial aid opportunities. If the tuition credits are not used by the beneficiary, they can be transferred among other children, grandchildren, nieces, nephews and godchildren.

If the owner of the mutual fund sells the fund prior to the beneficiary using the points that have been accrued, he or she maintains the use of the tuition credits. “The beneficiary has no ownership interest in the fund, only the tuition credits,” Palmer said.

The tuition credits, Palmer added, are a tax-free benefit. “If the price of college goes up (and it isn’t going to start getting cheaper), the answer is either to invest more or to hold the fund for a longer time. The fund performance has been most competitive.”

About the Author

Donald Liebenson


Donald Liebenson writes news and features for Millionaire Corner. He has been published in the Chicago Tribune, The Chicago Sun-Times, The Los Angeles Times, Fiscal Times, Entertainment Weekly, Huffington Post, and other outlets. He has also served as a marketing writer for Chicago-based Questar Entertainment and distributor Baker & Taylor.  

A graduate of the University of Southern California, he is married with a college-age son. He also writes extensively about entertainment.