The Gift College Investing Plan

State tax deduction for Arkansas taxpayers — Arkansas taxpayers who contribute to The GIFT Plan can deduct up to $5,000 (up to $10,000 total for a husband and wife) from their Arkansas adjusted gross income for the year such contributions are made. This tax deduction applies to any contribution made on or after January 1, 2005. (Note that tax deductions will be added to a taxpayer's adjusted gross income in any subsequent year if the taxpayer rolls the account over to another state's 529 plan or if the taxpayer makes a non-qualified withdrawal.)

Tax-deferred growth and tax-free qualified withdrawals -- Any earnings in your GIFT Plan
account grow federal income tax-deferred and earnings on your withdrawals are currently
exempt from federal income tax when used for qualified higher education expenses.* The
earnings portion of non-qualified withdrawals is subject to federal income tax and a 10%
additional federal tax.

The Aspiring Scholars Matching Grant Program provides matching funds of up to $500 for up to five years for lower to moderate income families who meet the qualifications.

Arkansas offers a variety of financial aid programs through the Arkansas Department of Higher Education to help offset the cost of college in Arkansas.

GIFT Plan owners can register with the Upromise Rewards Program and earn cash-back rewards from numerous merchants and manufacturers. If linked to a GIFT Plan account those rewards are periodically swept into the account to help maximize savings.

# Low cost Vanguard investment options -- The GIFT Plan offers three age-based options and
six custom portfolios managed by Vanguard. Each of the portfolios has a total
asset-based fee of only 0.85% annually. If the account owner or beneficiary is a resident of
Arkansas, no other fees are charged.

# Online enrollment and account management -- You can open and manage your account
online! Make contributions, set up an Automatic Investment Plan, change investment
choices for future contributions, and open and fund new accounts. You can also receive
your account statements via email, decreasing the amount of paper you receive on a regular basis.

# Ability to add to your savings through Upromise, a free rewards service that turns your
everyday spending into college savings -- Add to your savings in the GIFT Plan by joining
Upromise and get free money for college from hundreds of America's leading companies.
The money you save through Upromise can be automatically transferred to your GIFT Plan
account on a periodic basis, subject to the GIFT Plan's minimum quarterly transfer amount of
$25 for Upromise savings.