Set up your Tomorrows Scholar 529 account.
2016 Investment Changes
As part of our periodic investment review, Voya Investment Management, the program manager for Tomorrow’s Scholar® 529 Plan, has recommended and the College Savings Program Board has approved the following changes to the plan’s investment options to align them better with current market conditions.
For the plan’s Age and Risk-Based Options, Voya recommended the following changes:
- Increase allocation to U.S. large cap equities from US Mid Cap, with a modest tilt to U.S. large cap growth versus value, due to the Fed tightening likely to favor large cap equities.
- Decrease allocation to emerging market equities as slowing growth is endemic across the EM universe, with some countries in recession.
- As we expect an increase in interest rates in 2016, we plan to lower the interest rate sensitivity of the portfolios by adjusting the mix of high yield bonds, senior bank loans and inflation protected bonds accordingly.
Participants in the applicable Age and Risk-Based Options will saw their allocations automatically re-aligned after the close of business on January 29, 2016. There was no action on your part required.
Additionally, Voya recommended to streamlining the investment menu by reducing the number of Risk-Based Options from nine to five options:
- The Growth Option and Moderate Option will be removed from the plan and assets will transfer to the Moderate Growth, which will be renamed the Balanced Option.
- The Moderate Conservative Option and Conservative Option will be removed from the plan and assets will transfer to the Conservative Plus Option
Participants investing in the affected Risk-Based Fund Options were automatically exchanged into these options after the close of business on January 29, 2016. There was no action on your part required and the exchange does not count toward any annual permitted investment exchange under the 529 rules.
For the plan’s Single Fund Options, Voya introduced Voya Multi-Manager Mid Cap Value Option as a new option to give program participants access to best-in-class products and asset managers.
We believe these changes will better position the plan for current and future possible economic conditions, outperform college tuition inflation and assist in planning and investing for future college expenses.
The Program Description Supplement No. 6 dated December 31, 2015 (click here to view Program Description) provides more detail on these and other changes, including the maximum contribution limit increasing to $440,300.
Thank you for your continued support as we strive to keep Tomorrow’s Scholar one of the most affordable ways for families to reach their education savings goals.