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Survey Reveals 43% of Working Americans Who Anticipate Higher Education Expenses Would Enroll in 529 College Savings Programs If Offered Through Payroll Deduction |
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ROSELAND, New Jersey -- October 28, 2002 -- With the rapidly increasing popularity of the 529 College Savings Plan as an effective tax management and higher education savings tool, a recent survey revealed that 43 % of working Americans, who are currently saving or have plans to save in the future for higher education costs, would participate in a 529 College Savings Plan if offered through payroll deduction.
A Harris Interactive® QuickQuerySM survey sponsored by ADP Employer Services, a division of ADP, Inc., a leading provider of payroll services, benefits administration and human resource systems, found that of working Americans who were currently saving for higher education, or have plans to start saving for higher education, 40 % were familiar with the 529 College Savings Plan. Of these participants, 95 % said that their employer does not currently offer the 529 College Savings Plan as a part of its benefits package.
"We are continually looking for new ways to enhance our existing employee benefits offerings and support our recruitment and retention efforts," said Josephine Castaldo, vice president of branch administration, American Savings Bank of New Jersey. "ADP's 529 payroll deduction program offers convenient, automatic payroll deductions to help our employees meet their long-term financial goals and save for their children's college education."
To meet increasing demands and expand accessibility for working Americans, ADP has introduced to its payroll clients a corporate-sponsored, integrated, fully automated 529 payroll deduction program. This service helps to broaden the availability of these 529 plans to Americans of all income levels.
The survey indicated that currently, only 5 percent of participants' employers offered a 529 College Saving Plan, but with the introduction of ADP 529 Partners Program this fall, ADP will extend its 529 payroll deduction capabilities to other financial institutions that are 529 providers/administrators, thereby enabling them to offer ADP's payroll clients a choice in sponsoring a fully integrated, easy to administer 529 college savings plan.
"We are encouraged by the results of this survey, which indicate working Americans would be interested in 529 College Saving Plans, and ADP's Partners Program will help facilitate and enable easy access to corporate-sponsored 529 College Savings Plans," said Joe Grana, vice president of marketing, ADP's 529 Services. "Although the target market for 529 is smaller than 401(k), we believe it will experience a similar groundswell in popularity, and corporations are in a great position to drive awareness and participation in this important new benefit," adds Grana.
529 Growth Rate
According to Cerulli Associates, Americans using 529 accounts for college savings have tripled usage every year since 1998 when about 52,000 individual plans ($144M in assets) were in use. By 2001, there were 1.5 million 529 college savings plans ($9.1B in assets) in place and this year they are on track to hit an estimated 2.1 million accounts (estimated $16B in assets).
Methodology
This study was conducted online by Harris Interactive via its QuickQuerySM online omnibus from August 22-26, 2002, interviewing a nationwide sample of 2,878 adults (aged 18+). Data were weighted to be representative to the total US adult population, and the margin of error is (+/-1.8) percentage points with a 95% level of confidence.
About Harris Interactive®
Harris Interactive (www.harrisinteractive.com) is a worldwide market research and consulting firm best known for The Harris Poll®, and for pioneering the Internet method to conduct scientifically accurate market research. Headquartered in Rochester, New York, , Harris Interactive combines proprietary methodologies and technology with expertise in predictive, custom and strategic research. The Company conducts international research through wholly owned subsidiaries--London-based HI Europe (www.hieurope.com) and Tokyo-based Harris Interactive Japan--as well as through the Harris Interactive Global Network of local market-and opinion-research firms and various U.S. offices. EOE M/F/D/V
About ADP
Automatic Data Processing, Inc. (ADP) is one of the largest independent computing services firms in the world, with $7 billion in revenue and 500,000 clients. ADP's Employer Services (ES) Division is a leading provider of integrated business administrative solutions that help its over 450,000 clients efficiently manage their internal processes, allowing them to focus on core competencies. ADP's Employer Services offerings include both traditional and Internet-based outsourcing products and services, giving clients the ability to select from ADP's comprehensive range of World Class Service solutions. Services include: payroll, tax regulatory management, HRMS, benefits administration, time and labor management, retirement plan services, online recruiting, PEO services, and employment screening and selection.
For more information about ADP Employer Services, or to contact a local ADP sales office, reach us at 1-800-225-5237 or visit the company's Web site at www.adp.com. For more information about ADP's payroll deduction program for 529 College Savings Plans, you can reach us at 1-800-565-0367 ext. 505 or browse the rest of the adp529.com. If you are a plan provider/administrator, learn more about ADP's 529 Partners Program by calling 973-974-2124. |
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