What is the $500 Alfond Grant?
The $500 Alfond Grant for your baby’s future education is a legacy gift from Harold Alfond to benefit future generations of Maine children. Mr. Alfond believed that all children deserved the opportunity to achieve higher education and recognized that one of the biggest barriers to attending college is cost. So he created this gift as a great start to help families prepare for college early. He believed that you could transform individual families and the State’s future prosperity by helping all Maine’s children aspire to higher education.
For every baby born a Maine resident since 2013, the Alfond Scholarship Foundation invests a $500 Alfond Grant for his or her future qualified higher education expenses. (Maine babies born prior to 2013 were eligible for the Alfond Grant if a NextGen account was opened for them by their first birthday). ASF invests these funds until the child is ready to use them. There is no longer a need to open a NextGen account to receive the Alfond Grant. If a family wishes to open their own NextGen account to make contributions to their child’s future education, then the initial contribution that is normally required is waived for those accounts with beneficiaries eligible for the Alfond Grant.
For babies who were not born as Maine residents but have moved here and become Maine residents, they are still eligible to receive the Alfond Grant if a NextGen account is opened for them before their first birthday.
Who was Harold Alfond?
Harold Alfond is the late business entrepreneur, founder of Dexter Shoe Company, and Maine philanthropist who established the Harold Alfond Foundation, the first private foundation in Maine, in 1950. He had a lifelong commitment to the people of Maine and was deeply committed to his charitable causes. He brought a business mindset to his philanthropy by partnering with organizations he felt were well run and had important missions, and by fostering teamwork and partnerships through his matching challenge grants. His giving focused on education and health care, especially programs for youth. His love for Maine and interest in sports and children led him to give millions of dollars to Maine people through education, sports programs and centers for children.
The Harold Alfond College Challenge is his legacy gift to every Maine baby. Learn more about Harold Alfond at haroldalfondfoundation.org.
What is the Alfond Scholarship Foundation?
The Alfond Scholarship Foundation is the non-profit foundation that operates the Harold Alfond College Challenge. The Harold Alfond College Challenge is a statewide program that awards a $500 Alfond Grant to every Maine resident baby to help pay for education post-high school. The Alfond Scholarship Foundation is just one of many legacy gifts to Maine from late philanthropist, Harold Alfond.
Who can get an Alfond Grant? And how?
Every eligible Maine baby will have a $500 Alfond Grant invested for his or her future education expenses. Eligible children are:
1.A child born on or after January 1, 2013 who is reported by the Maine Bureau of Vital Records (“BVR”) as a Maine resident birth, and who does not already have a NextGen account opened with an Alfond Grant (learn more) Or:
2.A child born on or after January 1, 2013 who, if not reported by BVR as a Maine resident birth can prove Maine residency at birth when requesting a distribution of funds for qualified higher education expenses (learn more) Or:
3.A child who was not born a Maine resident, but for whom a NextGen is opened on or before the child’s first birthday, and the child is a Maine resident at the time of account opening (learn more)
Parents don’t need to do a thing until the child is ready to pursue qualified college, trade school or other education after high school. When the time comes, the student can request a withdrawal of the Grant and any earnings to apply to qualified higher education expenses. The money will be sent directly to the institution the child is attending.
Parents who want to also invest for their child’s qualified higher education expenses may want to open a NextGen account. Once a NextGen account is opened for an eligible child the Alfond Grant can be viewed on the account statements.
Is this too good to be true?
It is true – and it is good! If the child is eligible, they will have access to the $500 Grant and any earnings for their future qualified higher education expense.
What can the Alfond Grant be used for?
The Alfond Grant, including any earnings on the Grant funds, can only be used to pay for qualified higher education expenses (as defined in the Internal Revenue Code) at any U.S.-accredited post-secondary school, which may include graduate schools, trade schools, and some foreign institutions that participate in federal financial aid programs. The Alfond Grant must be used by the child’s 28th birthday.
The child does not have to attend college in Maine in order to use his/her Alfond Grant. The child does not have to attend a four-year college in order to use his/her Alfond Grant.
What happens to the Alfond Grant if the child doesn’t pursue education beyond high school?
The Alfond Grant, including any earnings on the Grant funds, will be forfeited to the Alfond Scholarship Foundation once the child turns 28 years old if it has not been used for his/her education.
How can I add to my child’s future education funds?
You can open a NextGen account for your child. Once the account is open, you will be able to make your own contributions. Every little bit helps!
What is NextGen?
NextGen is the name of Maine’s Section 529 college savings plan. Section 529 refers to the section of the Internal Revenue Code that provides unique tax advantages and other special features to encourage families to invest for college. Just as some retirement plans are referred to as 401(k) plans, college savings plans, such as NextGen, are referred to as 529 plans. The Finance Authority of Maine (FAME) is the administrator of NextGen and has contracted with Merrill Lynch to be the program manager and underwriter.
What if I have questions about how to complete the NextGen application?
Online applicants can reach Merrill Lynch by online chat or by phone while they are in the Client Direct Series online application. For assistance with the Client Direct Series paper application, you can call Merrill Edge at (877) 4-NEXTGEN. Or your financial advisor will help with the Client Select Series application.
Does it have to be a parent who opens a NextGen account on behalf of his/her new baby?
No, the account owner does not need to be the baby’s parent. Anyone at least age 18 can open the NextGen account on behalf of the Maine resident baby regardless of income or state residency. The account owner and the child must have a valid social security or taxpayer identification number.
Can family members contribute money to the child’s NextGen account?
Yes. Parents, grandparents, family and friends can add money to the child’s NextGen account. Although additional contributions are not required, it was Mr. Alfond’s hope that families, communities and businesses would rise to the challenge of investing in the future and educational aspirations of their own children. NextGen contribution coupons are available, making it easy for family and friends to make contributions into the child's NextGen account.
My other children aren’t eligible for the Alfond Grant. Are there other grants available for them?
Yes! Other grants for Maine residents can really add up! Maine NextGen accounts opened with a minimum initial contribution of $25 in the Client Direct Series or $50 in the Client Select Series may be eligible for a one-time $200 Initial Matching Grant, regardless of income.
Once you contribute at least $50 in a calendar year, NextGen will match 50% on every dollar contributed up to a $300 match per year.
If you contribute automatically using payroll deduction or from your checking or savings account, you may receive an additional $100 grant. Learn More
Will the Alfond Grant affect Temporary Assistance for Needy Families (TANF) benefits?
No. Currently the Grant does not count as an asset for those individuals who receive TANF benefits.