Orion Announces Updates to Texas LoneStar 529® Plan for Fee-based Advisors

Enhancements to College Savings Plan Offer New Benefits and Cost Savings for Advisors and their Clients

Orion Advisor Solutions, the premier provider of transformative wealthtech solutions for fiduciary advisors, and the Texas Prepaid Higher Education Tuition Board (“Board”) announced new enhancements to the LoneStar 529 Plan, which is managed by Orion and administered by the Board. Among the updates, new Class RIA units were introduced and are designed to be sold through fee-based advisors with no plan-level sales charges or distribution fees.

Other key changes include reduced plan-level fees, replacing age-based portfolios with target enrollment year portfolios, and the reduction of sales charges from 5.75% to 2.75% for Class A units. Additionally, individual asset class portfolio options were significantly expanded with the addition of several new asset classes, including a Guaranteed Interest Account.

Investing in an IRC Sec. 529 college savings plan early has numerous benefits, including tax-advantaged investing, estate planning benefits, control and flexibility, accessibility, and affordability. With the LoneStar 529 Plan, advisors and their clients can now choose from portfolios based on a target enrollment year or their specific risk tolerance and can create custom portfolios from a wide range of individual asset class options. The plan’s move to a target enrollment year structure is intended to make the reduction of equity risk smoother along the investment glide path and mitigate the risk of large market movements on the portfolios.

According to a study conducted by The College Board, the cost of a college education increased by more than 24% from the 2012-2013 school year to the 2020-2021 school year, while the total amount of financial aid granted decreased by 5%, forcing the average family to pay more out of pocket than expected for college. A college savings plan is specifically designed to help families—regardless of income level—save for college expenses at Texas public and private colleges and universities, out-of-state colleges and universities, career schools, and registered apprenticeship programs. Investments grow tax-deferred and withdrawals for qualified higher education expenses are tax-free at the federal level. Despite these benefits, 42% of families don’t have a college savings plan according to the Sallie Mae study How Americans Pay for College; however, those with a college savings plan save twice the amount of money for their child’s education than those without one.¹

“Deciding to invest in the education and future of a loved one is an emotional decision that advisors can help clients navigate while also prioritizing and aligning their client’s financial goals and values,” said Rob Percival, SVP, Strategic Relationships at Orion. “This RIA-friendly plan provides advisors another opportunity to deepen relationships with their clients as they take advantage of significant tax benefits while helping a child, grandchild, or other beneficiaries save for college.”

“As Americans grapple with inflation and economic uncertainty, it can be easy to lose sight of long-term goals,” said Texas Comptroller Glenn Hegar whose office administers the plan. “This plan is one tool that can help families keep those goals in focus. I hope that the recent enhancements to the Texas LoneStar 529 Plan make the plan more attractive to families saving for college.”

The LoneStar 529 Plan is the only advisor-sold 529 plan administered by the state of Texas. There are no income or state residency restrictions. Full plan features can be found in the Plan Description and Savings Trust Agreement.

Join our Webinar on Thursday, July 28

Orion will host a webinar on Thursday, July 28 at 11 a.m. CT. Join Orion’s Chief Investment Strategist, Rusty Vanneman, CFA, CMT, and Chief Behavioral Officer, Dr. Daniel Crosby, as they discuss the power of RIA-friendly 529 plans, including the recently enhanced LoneStar 529 Plan, and the key attributes to emphasize to clients. Click here to register.

To learn more about the plan, visit LoneStar529.com. Advisors can also contact their Orion point of contact or call the plan directly at 800-445-GRAD (4723), option #4 for additional information.

¹ Sallie Mae, Higher Ambitions: How America Plans for Post-secondary Education, 2020.

The LoneStar 529 Plan® (“Plan”) is administered by the Texas Prepaid Higher Education Tuition Board (“Board”). Orion Advisor Solutions, Inc. is the plan manager. The Plan and the Board do not provide legal, financial, or tax advice and participants in the Plan should consult a legal, financial, or tax advisor before investing. Estimated total asset-based fees are available at https://www.lonestar529.com/expenses and are published in the Plan Description and Savings Trust Agreement. Fees are subject to change.

Non-residents of Texas should consider whether their home state, or the beneficiary’s home state, offers its residents any tax or other state benefits, such as financial aid, scholarship funds, and protection from creditors, that are only available for participants in that state’s plan.

An account could lose money including the principal invested. No part of an account is a deposit or obligation of, or is guaranteed or insured by, the Board, the state of Texas, or any agency or agent thereof. Interests in the Plan have not been registered with or approved by the SEC or any state. Investors should carefully consider the investment objectives, risks, fees, charges, and expenses associated with municipal fund securities. The Board may suspend, modify, or terminate the Plan or change investment approaches, offerings, and/or underlying investment funds at any time and without the consent of account owners or beneficiaries. The Plan Description and Savings Trust Agreement contain this and other important information about the Plan and may be obtained by visiting www.lonestar529.com or calling 800-445-GRAD (4723), option #4. Investors should read all Plan documents carefully before investing.

© 2022 Texas Prepaid Higher Education Tuition Board. ‘‘LoneStar 529 Plan®’’ is a registered service mark of the Texas Prepaid Higher Education Tuition Board and distributed by Northern Lights Distributors, LLC, Member FINRA, SIPC. 4221 N 203rd St, Suite 100, Elkhorn NE 68022. All rights reserved.

About Orion Advisor Solutions

Orion is a premier provider of the tech-enabled fiduciary process that transforms the advisor-client relationship by enabling financial advisors to Prospect, Plan, Invest, and Achieve within a single, connected, technology-driven experience. Combined, our brand entities, Orion Advisor Tech, Orion Portfolio Solutions, Brinker Capital Investments, Redtail Technology, TownSquare Capital, HiddenLevers, and BasisCode create a complete offering that empowers firms to attract new clients seamlessly, connect goals more meaningfully to investment strategies and outcomes, and ultimately track progress toward each investor’s unique definition of financial success. With the addition of Redtail and TownSquare, the combined platform services more than $3 trillion in assets under administration and $62 billion of wealth management platform assets. Prior to closing on Redtail and TownSquare, Orion served 4.7 million technology accounts and supported more than 2,300 independent advisory firms with $1.9 trillion in assets under administration and $60 billion of wealth management platform assets (as of March 31, 2022), making Orion the platform of choice for all growth-focused advisory firms looking to strengthen their client relationships, gain a competitive edge in a crowded marketplace, and build strong, profitable businesses. Learn more at www.orion.com.

124-OAS-7/15/2022

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