tomorrow

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tomorrows scholar

• Start Investing for Tomorrow
• Today!

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Disclosure statements
tomorrows scholar portfolios may invest in stock
and bond investments. Stock investment values
fluctuate in response to the activities of
individual companies and general market and
economic conditions. Bond investment values
fluctuate in response to the financial condition
of individual issuers, general market and
economic conditions, and changes in interest
rates. In general, when interest rates rise, bond
investment values fall and investors may lose
principal value. Consult a program description
for additional information on these and other
risks. There is no guarantee that an account will
grow enough to cover higher education
expenses. An investors or a designated
beneficiarys home state may offer state tax or
other benefits that are only available for
investments in that states qualified tuition
program. Please consider this before
investing. Carefully consider the investment
objectives, risks, charges, and expenses of
tomorrows scholar before investing. For a
current program description, containing this and
other information, call 1-866-677-6933 or visit
tomorrowsscholar.com. Read it carefully before
investing. tomorrows scholar is a
state-sponsored 529 college savings plan
administered by the Wisconsin Office of the State
Treasurer. Wells Fargo Funds Management, LLC, a
wholly owned subsidiary of Wells Fargo Company,
provides investment management and administrative
services to the tomorrows scholar plan. Shares
in the program are distributed by Wells Fargo
Funds Distributor, LLC, Member FINRA/SIPC, an
affiliate of Wells Fargo Company. 206862 01-12
NOT FDIC INSURED NO BANK GUARANTEE MAY LOSE
VALUE
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Agenda

• Why invest for college
• Different college investing options
• What are 529s all about?
• tomorrows scholar
• Investment options within tomorrows scholar
• The multi-manager strategy
• SAGE Scholars Tuition Rewards Program

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Why investing for college is important

• Why is investing for college important?
• College can help a child or grandchild have a
  brighter future
• Reduces reliance on student loans
• Uses time and the power of compounding to your
  advantage
• Keeps your options open by planning ahead

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Will you have enough for college?

• The rising costs of a four-year college
• Tuition, books, room board add up quickly

454,439
Private University
210,873
Public University
Costs based on 2011-2012 estimate of average
tuition, fees, and room and board in current
dollars for 4-year public and private
universities according to the 2011 Trends in
College Pricing published by the College Board.
Projected pricing assumes a 6 annual increase in
college costs.
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The power of planning ahead
Advantage of Investing vs. Student
Loans 165.56/month
350
301.31
300
Invest now or borrow later To cover 25,000 in
college expenses, investing for 10 years before
college is a lot cheaper than paying back loans
for 10 years after college.
250
200
135.75
150
100
50
0
Monthly Investment
Monthly Loan Payment
Assumptions Total cost of college 25,000 8
annual return on investments and 8 loan interest
rate, compounded monthly 10-year investing
period and 10-year loan payback period. Annual
return does not represent the performance of any
tomorrows scholar portfolio.
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Putting time on your side
Regular contributions of any amount can really
add up over time.
This chart shows an account with monthly
contributions over a 10-year period.
125 per month
250 per month
500 per month
A program of regular investment cannot assure a
profit or protect against a loss in a declining
market. This hypothetical illustration assumes an
average annual return of 8. Annual return does
not represent the performance of any specific
investment.
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College investing options

• UGMA/UTMAs
• Coverdell Education Savings Accounts
• Roth IRAs
• Savings Bonds
• 529 College Savings Plans

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529s vs. other investing vehicles
Coverdell Education Savings Account
Savings Bonds
Roth IRA
YES
YES
YES
Federal Tax Deferral
2,000 per beneficiary, up to age 18
5,000 annually for Series EE and I Bonds for
each series
Maximum Contribution
5,000 in 2012 adjusted for inflation thereafter
YES
YES
Income Limits
YES
Time/Age Restrictions
YES
YES
YES
YES
YES
Estate Planning
YES
Gift Planning
YES
NO
NO
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The benefits of investing in 529s

• While not all investors may be able to take
  advantage of all the tax and other benefits of
  tomorrows scholar, here are four key features
  that may benefit you.
• Flexibility
• Control of the account
• Tax advantages
• Estate planning

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Flexibility of 529s

• High contribution limits
• Anyone can contribute no income restrictions or
  age limitations
• Use at schools nationwide and many abroad for a
  wide range of expenses
• Money can be used for qualified expenses,
  including tuition, fees, books, supplies, room
  and board (the student must be enrolled at least
  half-time), and required equipment

Note Individual states impose their own
restrictions and rules on 529 College Savings
Plans.
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Control of the account

• Control of assets remains with the person who
  establishes the account
• Successor
• Distribution
• Beneficiary

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The power of tax-deferred growth
Compare the growth potential of a taxable
investment vs. a tax-deferred 529 account
This hypothetical illustration shows the growth
of an annual investment of 5,000 made at the
beginning of each year. It assumes a 28 tax
bracket and an annual return of 8, compounded
monthly with a tax rate of 15 for dividends and
long-term gains and 28 for short-term gains. The
chart is for illustration only and does not
predict or guarantee the performance of any
tomorrow's scholar portfolio. Investors should
consider their personal investment horizon, as
well as their current and anticipated income tax
brackets when making an investment decision.
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One size does not fit all

• In-state vs. out-of-state plans
• State tax treatment of 529 plans varies from
  state to state and can be a factor in deciding
  which plan to select
• Some states offer a 529 tax deduction for state
  residents others might offer a tax credit for
  529 contributions
• Understand the value of your state's tax
  deduction
• In some cases, the tax deduction benefit may be
  offset by performance, contribution limits, and
  other plan features that are important to you

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Estate planning benefits

• Can gift up to 65K (130K married couple) per
  child in one year without incurring gift and
  generation-skipping transfer taxes, provided no
  other gifts are made to the same beneficiary in
  the 5-year period
• Contributions to the plan qualify for the 13K
  (26K married couple) annual gift tax exclusion
• Contributions are considered removed from the
  donors estate

If donor contributes more than 13,000 in one
year and elects to apply the gift tax exclusion
ratably over 5 years but dies before the close of
the 5-year period, the portion allocable to
calendar years beginning after the date of death
is included in the decedents estate.
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Grandparents can get involved too
Decrease your taxable estate while paying for
college
The gift tax exclusion can be very powerful. In
this example, a grandfather and grandmother each
provide 4 one-time gifts of 65,000 to 4
grandchildren. The 65,000 gifts are prorated
over five years and a total of 520,000 is
removed from the couples taxable estate.
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tomorrows scholar
Wells Fargo and the State of Wisconsin have
teamed up to offer the tomorrows scholar college
savings plan. The program is managed by Wells
Fargo Funds Management, LLC.
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The flexibility of multiple options
Wide range of options to meet your needs

• Seven fixed allocation options
• Offering a range of investments, from more
  aggressive to very conservative
• Three enrollment-based tracks
• Offering portfolios that are based on the number
  of years until college enrollment
• These options automatically get more conservative
  as the years go by

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Fixed allocation portfolios
GrowthPortfolio
BalancedPortfolio
9
7
40
50
43
51
Income Portfolio
Conservative Portfolio
Ultra-Conservative Portfolio
3
5
17
100
30
65
80
Bond Funds
International Stock Funds
Domestic Stock Funds
Money Market Funds
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Enrollment-based portfolios
Aggressive Growth Track Portfolios
Moderate Growth Track Portfolios
Conservative Growth Track Portfolios
100
100
100
80
80
80
60
60
60
40
40
40
20
20
20
0
0
0
10 or more
7 to 9
4 to 6
1 to 3
In College
10 or more
7 to 9
4 to 6
1 to 3
In College
10 or more
7 to 9
4 to 6
1 to 3
In College
Years to College
Domestic Stock Funds
Bond Funds
International Stock Funds
Money Market Funds
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The strength of a multi-manager strategy

• The portfolios include investments from the
  following fund families
• Wells Fargo Advantage Funds
• Harbor Funds
• Columbia Funds
• ING Funds

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SAGE Scholars Tuition Rewards

• Allows tomorrows scholar account owners to
  receive discounts for undergraduate school
  tuition at participating private schools
  throughout the country
• Awards tuition points based on your account
  balances up to 10 annually
• Each reward point equals 1 in guaranteed tuition
  discounts at participating private colleges and
  universities
• Over 265 member schools
• No fee to join
• Enroll online at tomorrowsscholar.com/sagescholars

The Tuition Rewards program is offered and
administered by SAGE Scholars, Inc., a private
for-profit corporation. SAGE Scholars is not
sponsored by or affiliated with Wells Fargo or
the tomorrows scholar college savings plan.
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Why tomorrows scholar?

• Although not all investors may be able to take
  advantage of all the tax and other benefits of
  tomorrows scholar, here is a recap of the key
  benefits.
• Tax advantages
• Flexibility
• Estate planning and gifting benefits
• Multiple investment options
• Multi-manager investment approach
• SAGE Scholars Tuition Rewards Program

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Start investing for tomorrowtoday
Dont wait to plan your scholars future. Contact
your investment professional today to find out
how to get started or visit www.tomorrowsscholar.c
om.