Though the end goal is the same — to help pay for college — everyone’s investment strategy may not be the same and can even differ greatly based on unique circumstances, financial constraints, timelines, and overall savings goals. If you are looking for an investment option customized for your student’s expected enrollment year in school, you might want to choose an Enrollment Year Investment Option. If you’re an experienced investor, you might choose a Risk-Based Investment Option you’ll review and change periodically. If your child is nearing college and you’ve been saving for a while, the Guaranteed Option might be the best choice. Once contributions are made to your account, you may change your investment choices for those contributions up to twice per calendar year or upon a change in beneficiary.
Enrollment Year Investment Option
The Enrollment Year Investment Option bases its investment mix on the date the student is projected to need the money to pay for qualified education expenses. The risk level automatically shifts from aggressive to conservative as the enrollment year approaches. Since not all students enroll in college upon turning 18 years of age, or you may be saving for K-12 tuition expense, you select the Enrollment Year Investment Option that corresponds to your student’s expected future year of enrollment or one that best meets your specific investment objective. This option is good for people who want a simple, all-in-one option.
These investment options provide account owners with the opportunity to select an investment option for its specific asset allocation. Each Risk-Based Option has a different investment objective and investment strategy. The allocations in the Risk-Based Options do not change automatically as the beneficiary ages as they do in the Enrollment Year Investment Option.
This investment option seeks to preserve capital and provide a stable return. This option may be good for shorter timeframes to save and for individuals who have lower risk tolerance.
The investment portfolios are subject to the risks of the underlying funds including the loss of principal.