State of Delaware Treasurer Colleen Davis

WILMINGTON, DE (December 5, 2019) – Delaware’s Route 9 corridor is unique. It’s history, diversity, and sense of community are a beacon that shines as an example throughout the state.

The Route 9 corridor has been through many decades of disadvantage. There have been a number of plagues on progress over the years including environmental challenges, institutional racism, and housing inequality. But these troubles have developed a steadfast resolve among residents – one that not only helps neighbors battle these conditions, but has created a confidence and independence in the community to create ideas on how to solves these problems themselves, growing communal solutions from within.

But, some parts of Route 9 are not as advanced, like the area lacking access to banking – not invested in by financial institutions for several years, while check-cashing intuitions and predatory lending runs rampant.

That is not to say that there isn’t economic opportunity in the area – there is. You might say that there is more opportunity than ever, with the Port of Wilmington producing $436 million in business revenue and $409 million in personal income for the region through jobs. There has been very little institutional and economic empowerment here – that is, until now.

Route 9 community leaders like Ron Handy Sr. brought people together to solve their own problems, as they have found themselves doing for decades. This month, the community will realize the opening of not one, but three reputable financial institutions throughout the corridor. It has been my honor to talk with community leaders, to hear their story, and to learn of their self-efficacy. By empowering themselves and doing this entirely on their own, their achievement is that much more significant.

I hope you’ll join me in celebrating this incredible work at 11 am on Wednesday December 11th at Rosehill Community Center, 19 Lambson Lane, New Castle, DE 19720, as the Banking Desert Initiative opens its first financial service center with Del-One. Rosehill will host an interactive teller machine (ITM), as well as in-person with a teller three days a week. Gulftainer’s Training Facility at Elbert Palmer Elementary School and William Penn High School will also host credit union services soon – and with the passion of this community behind the effort, I know we will see many more openings in the future.

Morningstar rating increased from Bronze to Silver in 2019

Following assessments and interviews, Morningstar, the nation’s premier plan rating group, has upgraded the DE529 plan from a Bronze to a Silver ranking. Delaware now joins an elite group of 13 Silver-rated plans.

“Through this elevated ranking, the leadership of the Plans Management Board and the hard work of our team are being noticed nation-wide for the service it provides residents,” said Treasurer Davis. “Being able to reduce our fees will make a big difference for participants and prospective plan-holders, and we hope to go for Gold in the future.”

A key component of Delaware’s high score was due to its administration – phasing out more expensive investment selections and adding a new offering of a blended investment option, which allows the accountholder to engage in both active and passive investment management. Additionally, DE529 is one of the lowest-cost educational investment options, and recently reduced administrative fees.

Morningstar conducts annual reviews of 62 plans, analyzing multiple categories within the given plan, as well as its management. Scores indicate a review of the plans’ investment options, management, contracted relationships, investment performance, and overall price of the plan. Only four plans receive a Gold rating from Morningstar.

Delaware’s 529 is a tax-advantaged savings plan that is available to the public, easy to open, and offer investment options so that savings may grow over time until they are used for associated costs including tuition, books, housing, apprenticeships and more. Learn more at 529.Delaware.Gov.

State continues to have one of the lowest-cost investment plans

Treasurer Colleen C. Davis announced today a reduction in fees for Delaware’s 529 Education Savings Plan. Already one of the nation’s lowest-cost savings plans, the reduction is estimated to save participants nearly $87,000 total each year and further incentivize new account openings in the Delaware plan.

“Helping our residents spend less to save is so important. Education is already expensive, and now participants can keep more of their investment earnings to use towards those costs,” said Treasurer Davis. “With no minimum to open an account, and some of the lowest fees nationwide, we’re working to make sure that people of all income levels can save for a better future.”

Fees vary based on the participant’s investment strategy and are collected to administer the plan. Participants do not need to take any action for the fee reduction, which began October 1.

The number of accounts in the Delaware 529 Plan have grown by 4% over the last three years, outpacing the industry nationwide. Nearly 22,000 accounts in the plan hold more than $686 million in investments.

Delaware’s 529 is a tax-advantaged savings plan that is available to the public, easy to open, and offer investment options so that savings may grow over time until they are used for associated costs including tuition, books, housing, apprenticeships and more. Learn more about at 529.Delaware.Gov.

Senate Bill 143, signed today by Governor Carney, will increase savings plans education

Treasurer Colleen C. Davis, bill sponsors Sen. Trey Paradee and Rep. Krista Griffith, and children from Brilliant Little Minds Learning Academy celebrated today as Governor John Carney signed Senate Bill 143 into law. This legislation allows the Plans Management Board and the Office of the State Treasurer to increase awareness of the benefits of saving through the 529 Education Savings Plan and through ABLE Plans for those with disabilities.

Also joining the event were Lt. Governor Bethany Hall-Long, Insurance Commissioner Trinidad Navarro, Secretary of Finance Rick Geisenberger, Rep. Mike Smith, Rep. Bryan Shupe, and members of the Delaware Department of Education and the Plans Management Board. The Governor and legislators talked about their own experiences with the savings plans and discussed the importance of the bill. Treasurer Davis asked the kids from Brilliant Little Minds Learning Academy what they want to be when they grow up. “Whatever you want to be when you grow up, you have to work hard in school and save your money to make it happen. I’m so glad that we could have young people here with us as we take this step towards expanding economic opportunity and educational attainment.”

Senate Bill 143 allows the Board to pursue methods of increasing savings plan enrollments outside of the high-income earning households that traditionally participate by allowing for incentive-based marketing. Possible avenues of promotion include a scholarship program or a match plan, as seen in other states. These options will be explored by the Board at future meetings. Additionally, new promotions aimed at increasing awareness of using 529s for adult educational attainment and for non-college costs, such as apprenticeship programs, will be integrated into future marketing efforts.

“The costs of education are skyrocketing, but national enrollments in 529 plans have gone down,” Treasurer Davis said. “In Delaware, we have worked hard to share the benefits of these plans with our residents and are continuing to see new enrollments. Our nearly 22,000 accounts represent growth of 4% over the last three years, and this bill will allow us to continue to expand. Like these savings plans, Senate Bill 143 is an investment in our future.”

“America is facing a crisis when it comes to saving money for the future,” said Sen. Trey Paradee, D-Dover, who works as a financial advisor. “Right now, 40 percent of U.S. adults don’t have enough savings to cover even a $400 emergency – a brutal fact, which is leaving too many families one missed paycheck from a financial nightmare. We need to be doing all we can to encourage people to take advantage of savings plans, particularly the favorable products offered by our state. This bill is aimed at raising awareness of those products and examining how we can better position them to help working families in need.”

“Given the daunting cost of college education, the state of Delaware needs to do everything it can to promote college savings. Delaware has made great strides in creating accounts for those for disabilities, which will allow them to save money without sacrificing services they depend on,” said Rep. Krista Griffith, D-Fairfax. “This bill will allow Treasurer Davis to increase outreach about Delaware’s 529 plan and make more Delawareans aware of the benefits so they can invest and plan for their futures. I’m always looking to help improve accessibility to these accounts and I look forward to continued efforts in the General Assembly.”

Both tax-advantaged savings plans are available to the public, easy to open, and offer investment options so that savings can grow over time until they are used for associated costs. Learn more about our savings plans at 529.Delaware.Gov and ABLE.Delaware.Gov.