What is the Harold Alfond College Challenge?
The Harold Alfond College Challenge is a statewide scholarship program that gives a $500 grant to every Maine resident baby to start an account with Maine's college savings program called the NextGen College Investing Plan® (NextGen®). Click here to review Terms and Conditions. The Harold Alfond College Challenge Grant (Alfond Grant) is intended to help Maine families plan for education beyond high school.
Who is 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. The Harold Alfond College Challenge is his legacy gift to every Maine baby. For more information about Harold Alfond click here.
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 NextGen program manager and underwriter.
Who can get an Alfond Grant?
- Maine resident babies, including babies who are adopted by Maine parents or whose parents move to Maine before the baby’s first birthday are eligible as long as the baby is enrolled in NextGen on or before his/her first birthday.
- Anyone at least 18 years old can open a NextGen account and be the account owner regardless of which state they live in. The account owner does not need to be the baby’s parent. The account owner must have a valid social security or taxpayer identification number.
- See Grant Terms and Conditions for additional information.
Is this too good to be true?
It is true. This $500 Alfond Grant for your baby’s future education is a legacy gift that Mr. Harold Alfond left to the State of Maine. Mr. Alfond was the former owner of Dexter Shoe Company and created businesses in Maine with Maine people. 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. 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 invest 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.
It is true, every Maine resident baby may receive $500 to open a NextGen account. To receive the grant, a NextGen account has to be opened on or before the baby's first birthday. And, it is also true that you do not need to add any of your own money to open your baby's NextGen account, but Mr. Afond's hope was that families would invest in their own child's future.
Will accepting this grant affect Temporary Assistance for Needy Families (TANF) benefits?
No. Currently the $500 grant does not count against an account holder who also receives TANF benefits.
Am I required to contribute money to the NextGen account in order to get my child’s Alfond Grant?
No. You do not have to add any of your own money to receive the $500 Alfond Grant. However, it was Mr. Alfond’s hope that families, communities and businesses would rise to the challenge and invest in the future and educational aspirations of Maine’s children.
Are there other Maine grants available for the baby's brothers and sisters or others for whom I would like to start a NextGen account?
Maine accounts opened with a minimum initial contribution of $50 are eligible for a one-time $200 Initial Matching Grant, regardless of income. Learn more
Maine accounts opened on or after January 1, 2011 are eligible for a NextStep Matching Grant, which provides a one-third match on contributions made to the account within the first 24 months of account opening, up to a maximum total award of $400, regardless of family income. Learn more
Maine accounts opened on or after January 1, 2011 are eligible for a one-time $50 Automated Funding Grant when any automated funding service option is elected, regardless of income. Learn more
How does a family receive their baby’s $500 Alfond Grant?
In order to obtain the $500 Alfond Grant, a NextGen account must be opened and the child must be named as the account beneficiary on or before the child's first birthday. You may enroll in the Client Direct Series online at Merrill Edge*, or you can obtain enrollment materials from your local Maine bank, or request a paper enrollment kit be mailed to you or you can download a pdf of the enrollment kit. If you would like to work with a financial advisor, you may enroll in the Client Direct Series through a Maine Distribution Agent. FAME will automatically apply the $500 Alfond Grant, to the NextGen account only after the account is opened and an account number is assigned.
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 online application. For assistance with the Client Direct Series paper application, click here or you can call FAME at 800.228.3734 or e-mail FAME at firstname.lastname@example.org. Or your financial advisor will help with the Client Direct Series applicaiton.
Does it have to be a parent who opens the 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 residency. The account owner must have a valid social security or taxpayer identification number.
How will a family know that the NextGen account is opened and the Alfond Grant has been awarded?
The account owner can expect to receive communication after submitting a completed NextGen application:
If you complete the online application at Merrill Edge*, expect a response online when you have completed the process. If you complete the paper application, you can expect:
- A letter from Merrill Lynch, the NextGen Program Manager, providing the NextGen account number, and confirming that the account has been opened;
- A congratulatory award letter from FAME notifying you that the Alfond Grant has been applied to the NextGen account.
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 NextGen account.
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, including graduate schools, trade schools, and some foreign institutions that participate in federal financial aid programs. The Alfond Grant must be used by the time the beneficiary (child) is 28 years old.
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 beneficiary (child) turns 28 years old if it has not been used for his/her education.