2006 News Releases

Majority of parents and grandparents give money for children’s and grandchildren’s college education, yet most producers say 529 savings plans are less than 5% of their business

Boston – In a recent survey of more than 780 producers conducted online by Zoomerang for John Hancock College Savings, 76 percent of producers say only 1 to 4 percent of their business comes from 529 savings plan sales. In contrast, a consumer survey conducted by Synovate for the company found that more than two-thirds of parents and nearly one-half of grandparents planned to contribute to 529 plans if they hadn’t already.

“With clear interest on the part of consumers, we feel there’s a real opportunity for producers,” said Diana Scott, senior vice president and general manager of John Hancock College Savings. “There are many benefits of using 529 savings plans versus other vehicles for college funding, and now with the tax-free status of qualified distributions being permanent, we hope producers take another look at offering 529s.”

When asked what time of year is the best for sales, the largest number of producers (42%) responded that fourth quarter is their strongest time of year for selling 529 plans, followed by 24 percent saying first quarter, 17 percent second quarter and 16 percent third quarter.

Although the strongest selling season coincides with what is traditionally seen as the gifting season, more than half of producers (53%) say they promote gifting all year long, not just during the fourth quarter. Consumers also felt there was no best time to contribute to a 529 plan. Nearly half (46.2%) felt a gift for college education needed no special occasion. Following that were: at graduation (31.4%), on the child’s birthday (11.7%) and on the child’s birth (5.6%).

“Twenty-nine percent of producers said they don’t sell 529 plans simply because their clients don’t ask for them – but we also see a number of producers who talk about the product in the course of regular business with their clients,” said Scott. “While a 529 sale may not be a large ticket – although some of them are – the relief parents feel in starting to tackle this financial issue is so great, it pays off by strengthening relationships and many times leading to sales of other products.”

When asked how those producers who sell 529 savings plans discuss the topic with their clients, 49 percent said college savings came about as the result of an overall planning discussion; 45 percent said it was mentioned in an annual review and 42 percent said it came up when a client experienced a life event such as having a child.

When asked about the benefits of 529 savings plans, producers felt the federal tax advantages were the most important to their clients with 84 percent considering the feature extremely or very important. Flexibility to change beneficiaries was considered extremely or very important by 82 percent of producers and choice of investment options in the savings plan ranked third with 77 percent of producers saying it was extremely or very important.

According to producers, the characteristics of 529 savings plans most important in their sales were:

• Performance – 79% said extremely or very important
  
• Multi-managed platform – 67% said extremely or very important
  
• Selling tools such as calculators – 58% said extremely or very important
  
• Brand recognition – 49% said extremely or very important
  
• Wholesaling support – 45% said extremely or very important

“In our consumer research, a vast majority (92.6 %) of consumers said they wanted to be able to send their children or grandchildren to whatever college the children wanted,” said Scott. “Our industry can help parents move beyond the paralysis created by overwhelming college costs and acquaint them with the many benefits – tax advantages among them – that 529 savings plans have to offer.”

Methodology
John Hancock commissioned the producer survey through Zoomerang. Zoomerang pioneered online survey software in 1999 to give organizations a powerful self-service alternative to conduct accurate comprehensive surveys with a minimum of cost and effort. Today, Zoomerang is the world’s #1 source of online surveys, helping thousands of organizations – including over 70 of the Fortune 100 – in 100+ countries.

John Hancock commissioned the consumer survey through Synovate’s eNation service, based in Chicago, Ill. Two thousand individuals 18 years of age or older in the contiguous U.S.A. were queried through online surveys. The sample consists of individuals selected from the online segment of Synovate’s Consumer Opinion Panel, and is balanced to be representative of the general population based upon region, gender, age, and household income data from the U.S. Census Bureau.

John Hancock Freedom 529
John Hancock Freedom 529 is a national Section 529 college savings plan. John Hancock Freedom 529 is offered by the Education Trust of Alaska, managed by T. Rowe Price, and is distributed by Hancock Distributors LLC, through other broker/dealers that have a selling agreement with John Hancock Distributors LLC. John Hancock Distributors LLC is a member of the NASD and is listed with the Municipal Securities Rulemaking Board (MSRB). The plan offers a multi-managed approach, allowing investors to work with their financial consultants to pursue a strategy to maximize their investment opportunities, while managing risk. Expanding upon the inherent advantages of a typical 529 savings plan, the product offers investment choices from some of the nation’s top mutual fund managers.

About Manulife Financial and John Hancock
John Hancock is a unit of Manulife Financial Corporation, a leading Canadian-based financial services group serving millions of customers in 19 countries and territories worldwide. Operating as Manulife Financial in Canada and Asia, and primarily through John Hancock in the United States, the Company offers clients a diverse range of financial protection products and wealth management services through its extensive network of employees, agents and distribution partners. Funds under management by Manulife Financial and its subsidiaries were Cdn$381 billion (US$341 billion) as at September 30, 2006. Manulife Financial Corporation trades as ‘MFC’ on the TSX, NYSE and PSE, and under ‘0945’ on the SEHK. Manulife Financial can be found on the Internet at www.manulife.com.

The John Hancock unit, through its insurance companies, comprises one of the largest life insurers in the United States. John Hancock offers a broad range of financial products and services, including universal life insurance, variable life, term life and whole life, as well as college savings products, fixed and variable annuities, long-term care insurance, mutual funds, 401(k) plans and various forms of business insurance.

If your state or your designated Beneficiary's state offers a 529 plan you may want to consider what, if any, potential state income tax or other benefits it offers, before investing.
State tax or other benefits should be one of many factors to be considered prior to making an investment decision. Please consult with your financial, tax or other advisor about how these state benefits, if any, may apply to your specific circumstances. You may also contact your state 529 plan or any other 529 college savings plan to learn more about their features.  Please contact your financial consultant or call 1-866-222-7498 to obtain a Plan Disclosure Document or prospectus for any of the underlying funds. The Plan Disclosure Document contains complete details on investment objectives, risks, fees, charges and expenses, as well as more information about municipal fund securities and the underlying investment companies that should be considered before investing. Please read the Plan Disclosure Document carefully prior to investing.

John Hancock Freedom 529 is a college savings plan offered by the Education Trust of Alaska, managed by T. Rowe Price, and distributed by John Hancock Distributors LLC through other broker/dealers that have a selling agreement with John Hancock Distributors LLC.  John Hancock Distributors LLC is a member of the NASD and is listed with the Municipal Securities Rulemaking Board (MSRB). © 2006. John Hancock Life Insurance Company (U.S.A.), a Manulife Financial Company. All rights reserved. Information included in this material is believed to be accurate as of the November 2006 printing date. MLI1120067197

529 plans are not FDIC insured, may lose value and are not bank or state guaranteed.

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Contact:
Beth McGoldrick
617-663-4751