Introducing
Year of Enrollment Portfolios
We’ve transitioned our current Age-Based Enrollment Portfolios to Year of Enrollment Portfolios. Both Age-Based and Year of Enrollment Portfolios move from higher-risk to more conservative options automatically as your student ages/gets closer to enrollment in order to protect your investment. However, with Year of Enrollment Portfolios, these rebalances happen more often making for a smoother and more gradual shift in the portfolio and reducing market timing risk.
The Benefits of a Year of Enrollment Portfolio
Improved Market Risk Management with a Smoother Glide Path
Funds invested in a Year of Enrollment Portfolio will automatically rebalance four times per year. These smaller, more frequent adjustments mean a smoother and more gradual shift in the portfolio and can reduce market timing risk that comes with less frequent but larger changes.
Easy Portfolio Selection
Year of Enrollment Portfolios make it easy for new investors to select an investment option for their students. They simply choose the year they expect their student to enroll in school (K-12, college, university, trade school, or start an apprenticeship program or qualified certificate program).
Save for More than One Goal!
While many families will choose just one Year of Enrollment Portfolio for their student, some may like the fact that they can invest in several different Year of Enrollment Portfolios if they want to save for multiple types of education. For example, a family could easily save for three education goals such as K-12, post-secondary, and graduate by choosing three different Year of Enrollment Portfolios.
Also, families have the flexibility of changing their Year of Enrollment Portfolio if they expect their student to delay their start to higher education.
FAQs
I am currently invested in an Age-Based Portfolio. Do I need to do anything?
No, your accounts invested in any Age-Based Portfolio automatically transitioned to a Year of Enrollment Portfolio.
Will I be taxed for these changes?
No! These automatic portfolio transitions weren’t considered a taxable event or counted as one of your two allowed yearly investment exchanges.
Is this a good time to review my investments and goals?
Absolutely! If you are aware that your student will not attend school during the year their Year of Enrollment Portfolio is assigned, you may want to change to a Year of Enrollment portfolio with a different target enrollment date. You can make that change after the new Year of Enrollment Portfolios are launched. Just keep in mind, if you do make an investment change, it will count as one of the two you are allowed each year.
USRRMH1023U/S-3172892
