A state-sponsored, tax-advantaged college savings program established under and operated in accordance with IRC §529 designed to help save for Qualified Higher Education Expenses.
A savings trust account established by an Account Owner pursuant to the Savings Trust Agreement for purposes of investing in one or more portfolios. Accounts are part of the Plan and are held in the name of the Plan on behalf of and for the benefit of the Account Owners and the Beneficiaries.
The individual or entity signing the Application and establishing an Account or any successor to such individual or entity. References in this Glossary to “you” or “your” mean the Account Owner in such capacity.
The LoneStar 529 Plan (“Plan”) enrollment form.
A charge for expenses incurred in the administration of a 529 college savings plan, which may include services such as recordkeeping, auditing, and preparing and printing statements and reports. This fee is deducted from your holdings based on a percentage of your assets in the plan. You can find a description of the fees and expenses charged by the plan in the Plan Description and Savings Trust Agreement.
Automatic Investment Plan (AIP)
Automatic Investment Plan allows you to contribute a fixed amount of money in regular intervals. Funds are automatically deducted from the Account Owner’s bank account or other financial institution or through payroll deductions.
Annual Rate of Return
The rate of return on your investment, expressed as a percentage of the total amount invested.
A strategy for maximizing gains while minimizing risks in your investment portfolio. Asset allocation involves dividing your assets on a percentage basis among different broad categories of investments, including equity, fixed income, and money market.
The individual identified by the Account Owner whose Qualified Higher Education Expenses are expected to be paid from the Account or, for Accounts owned by a state or local government or qualifying tax-exempt organization (otherwise known as a 501(c)(3) entity) as part of its operation of a scholarship program, the recipient of a scholarship whose Qualified Higher Education Expenses are expected to be paid from the Account. Any individual may be the Beneficiary of an Account, including the Account Owner.
A government entity or 501(c)(3) not-for-profit organization can establish an Account to fund scholarship programs without designating a Beneficiary at the time the Account is established.
The Texas Prepaid Higher Education Tuition Board.
Class A Units
An investor purchasing A shares pays an up-front sales charge plus an on-going distribution/service fee.
Class RIA Units
Class RIA units are available only through qualifying fee-based Registered Investment Advisors (RIAs) or Investment Advisor Representatives (IARs)
Class RIA units do not have an up-front sales charge or an asset-based distribution/service fee. Rather, fees will be assessed separately by the financial advisor.
Code or IRC
The Internal Revenue Code of 1986, as amended.
Coverdell Education Savings Account (Coverdell ESA, Coverdell Account or Education Savings Account)
A trust or custodial account with a Coverdell ESA designation that is created in the United States solely for paying qualified education expenses for designated beneficiaries under the age of 18 or special needs beneficiaries only if the written instrument creating the trust meets certain requirements. See Types of Investments for more details.
An account that is created for the benefit of a minor, with an adult (agent, bank, trust company, or other organization) serving as the custodian in accordance with applicable state law. The adult controls the funds until the child reaches the age of majority, at which point the account transfers into the child’s name.