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June 1, 2023
Family Finances
NYSaves 529 Direct Plan – Target Enrollment Portfolios
For those saving in the NYSaves 529 Direct Plan, you’ve likely received an email by now announcing the transition from Age-Based Portfolios to Target Enrollment Portfolios happening July 28th, 2023. If you’re currently using a custom allocation from the investment options within the plan, this change will not impact your account.
However, if you are using one of the Age-Based Portfolios, your investments will be automatically mapped over into one of the Target Enrollment Portfolios. Shown below are how those changes will be made:
Conservative Age-Based Portfolio- These portfolios will be mapped over to a Target Enrollment Portfolio ~12 years from the date of birth of the beneficiary.
Moderate Age-Based Portfolio- These portfolios will be mapped over to a Target Enrollment Portfolio ~18 years from the date of birth of the beneficiary.
Aggressive Age-Based Portfolio- These portfolios will be mapped over to a Target Enrollment Portfolio ~21 years from the date of birth of the beneficiary.
The goal of these changes is to have the Target Enrollment Portfolios reduce stock market risk more gradually than the Age-Based Portfolios. The Age-Based Portfolios use age-bands and as the beneficiary’s age moves into another band, the stock allocation drops significantly (~12.5%, in most cases). With the Target Enrollment Portfolios, the stock allocation will be reduced each year, but the changes are much smaller.
If you have questions about the strategy within your NYSaves 529 plan, you should contact your financial advisor to ensure that the investment mix is appropriate for your situation and goals.
