529 plan FAQs: About the portfolios and investments
How do I choose my investments?1
Fidelity offers a wide range of investment options for your 529 plan account.
To help you determine which option may be best for you, consider these 2 questions:
- Do you want a portfolio that's managed for you, automatically becoming more conservatively invested as your child nears college age?
- Do you want to choose your own portfolios?
Age-Based Strategy: Fidelity offers 3 age-based investment options that adjust their asset allocations automatically, becoming more conservative as the beneficiary nears college age. These options provide access to Fidelity Funds, Multi-Firm Funds, and Fidelity Index Funds.
Fidelity Funds: These are designed to generate returns that attempt to beat a major market index over the long term. These portfolios invest solely in Fidelity Funds that are managed by dedicated portfolio managers who are making investment decisions backed by Fidelity's proprietary investment research.
Multi-Firm Funds: Like our Fidelity Fund Age-Based Portfolios, these are designed to generate returns that attempt to beat a major market index over the long term. While the funds themselves are managed by Fidelity and other firms, the way the investments are spread among different funds is managed by dedicated portfolio managers at Fidelity. This option provides an opportunity to diversify your funds across multiple fund companies.
Fidelity may use its proprietary asset allocation research to make active asset allocation decisions in the Age-Based Portfolios that invest in Fidelity Funds and Multi-Firm Funds. Such active asset allocation decisions may better enable the portfolios to take advantage of short- to medium-term opportunities and market conditions. Although an active asset allocation strategy is designed to add value, there is no guarantee any value will be added, and the strategy may result in losses to the portfolios. Please review a 529 plan Fact Kit for more information on portfolio asset allocation.
Fidelity Index Funds: These are designed to generate returns that closely mirror the performance of a major market index over the long term. These portfolios invest solely in Fidelity Index Funds, and are able to keep transaction costs and other expenses low because they are passively managed. This means that the securities currently held in the respective index determine your investments.
Custom Strategy: If you want to build your own investment mix, choose from 4 investment portfolios offered by Fidelity: Static, Individual Fund, Age-Based, and Bank Deposit.
Static Portfolios invest in several different funds managed by Fidelity and have an asset mix that doesn't change over time. You may choose between portfolios invested in Fidelity Funds or Fidelity Index Funds.
Individual Fund Portfolios invest in a single Fidelity Fund or Fidelity Index portfolio. Options include a mix of equity, fixed income, money market, and bank deposit portfolios.
Age-Based Portfolios are managed according to the approximate year the beneficiary is projected to enter college. These portfolios take a more aggressive approach during the early years of saving for college, and become more conservative over time as the need to pay for qualified higher education expenses approaches.
The Bank Deposit Portfolio2 seeks preservation of principal and is designed for beneficiaries of any age. This portfolio is composed exclusively of a deposit in an FDIC-insured, interest-bearing account.3
See investment options for more information.
1. The IRS does not allow participants to have direct or indirect control over the investments in a 529 account.
2. Although the underlying deposits are eligible for FDIC insurance, subject to applicable federal deposit insurance limits, the units of the Bank Deposit Portfolio are not insured or guaranteed by the FDIC or any other government agency. You are responsible for monitoring the total amount of your assets on deposit at the depository bank, including amounts held directly at the depository bank. All such deposits held in the same ownership capacity at the depository bank are subject to aggregation and to the current FDIC insurance coverage limitation of $250,000. Please see your 529 Fact Kit for more details.
3. Bank Deposit Portfolio is not an eligible investment selection for Trust Account Registrations.
Can I change how my account is invested?
Yes, new deposits can be made into any of the portfolios available in the Fidelity-managed 529 plans. Many customers establish standing instructions, such as making all contributions to the same portfolios each period, to avoid providing new instructions with every deposit.
You may reallocate previously invested monies (contributions and earnings) twice each calendar year and upon a change to the beneficiary. See investment options for more information.
Use the 529 College Plan Investment Form (PDF) to change instructions on current and future investments.
Can I pick the investments for my account?
You choose the portfolios, but not the individual funds. The IRS does not allow a participant to have direct or indirect control over the investments in a 529 account. The 529 portfolios are invested in a combination of mutual funds. To see a list of the underlying mutual funds that make up each portfolio, visit the Plan Performance pages.
Who are the Fidelity-managed 529 plan portfolio managers?
Andrew Dierdorf and Brett Sumsion are the co-managers of the UNIQUE Plan, the Fidelity Arizona Plan, the U.Fund Plan, and the Delaware Plan Portfolios.
Finola McGuire Foley is a co-manager of the Fidelity-managed 529 plan Index Portfolios with Mr. Dierdorf and Mr. Sumsion.
Andrew Dierdorf is a portfolio manager in the Global Asset Allocation (GAA) group at Fidelity Investments. In this role, Mr. Dierdorf is responsible for co-managing Fidelity's U.S. and Canadian target date portfolios, including Fidelity Freedom Funds, Pyramis Lifecycle Portfolios, Fidelity ClearPath Retirement Portfolios, Pyramis ClearPath Lifecycle Solutions, Fidelity Income Replacement Funds, and Fidelity-managed 529 College Savings Plans. He is also a co-manager for the Fidelity Four-in-One Index Fund.
Previously, Mr. Dierdorf co-managed Fidelity Global Strategies Fund and Fidelity Tactical Strategies Fund until May 2014. Prior to joining Fidelity in his current position in 2004, Mr. Dierdorf worked as an actuary at CIGNA from 1997 to 2004, and held various actuarial roles at Provident Mutual Life Insurance Company from 1994 to 1997. He has been in the financial services industry since 1993.
Mr. Dierdorf earned his bachelor of science degree in statistics from the University of Delaware, where he also minored in economics. He is a Chartered Financial Analyst (CFA) charterholder, as well as a Fellow of the Society of Actuaries (FSA), Chartered Market Technician (CMT), and a Member of the American Academy of Actuaries (MAAA).
Brett Sumsion is a portfolio manager on the Target Date team within the Global Asset Allocation (GAA) group at Fidelity Investments. In this role, Mr. Sumsion is responsible for co-managing Fidelity's U.S. and Canadian target date portfolios, including Fidelity Freedom Funds, Pyramis Lifecycle portfolios, Fidelity ClearPath Retirement Portfolios, Pyramis ClearPath Lifecycle Solutions, Fidelity Income Replacement Funds, and Fidelity-managed 529 College Savings Plans.
Prior to joining Fidelity in 2014, Mr. Sumsion held various positions at DuPont Capital Management, Inc., including that of managing director of asset allocation from 2008 to 2013 and portfolio manager from 2005 to 2008. Previously, Mr. Sumsion worked at Strategis Financial Group, Inc., where he was chief executive officer from 2004 to 2005 and vice president of asset allocation research from 2001 to 2004. He has been in the investments industry since 2001.
Mr. Sumsion earned his bachelor of arts degree in economics from Brigham Young University and his master of business administration degree in finance from The Wharton School at the University of Pennsylvania. He is also a Chartered Financial Analyst (CFA) charterholder.
Finola Mcguire Foley is a portfolio manager in the Global Asset Allocation (GAA) group at Fidelity Investments. In this role, Ms. Foley co-manages Fidelity-managed 529 plan Index Portfolios, Fidelity's Freedom Index funds and FIAM Index Target Date portfolios. Additionally, she co-manages the Fidelity Four-in-One Index Fund.
Prior to assuming her current responsibilities, Ms. Foley held various roles within Fidelity, including assistant portfolio manager, portfolio analyst and senior business analyst at Strategic Advisers LLC. Previously, Ms. Foley was a systems analyst at Fidelity Investments Management Technology and at Fidelity Personal and Workplace Investing. She has been in the financial industry since joining Fidelity in 2005.
Ms. Foley earned her bachelor of science degree in business information systems from University College Cork and her master of business administration degree in finance from Bentley University. She is also a CFA charterholder.
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The UNIQUE College Investing Plan, U.Fund College Investing Plan, Delaware College Investment Plan, and Fidelity Arizona College Savings Plan are offered by the state of New Hampshire, MEFA, the state of Delaware, and the Arizona Commission for Postsecondary Education, respectively, and managed by Fidelity Investments.
If you or the designated beneficiary is not a New Hampshire, Massachusetts, Delaware, or Arizona resident, you may want to consider, before investing, whether your state or the beneficiary's home state offers its residents a plan with alternate state tax advantages or other state benefits such as financial aid, scholarship funds and protection from creditors.
Units of the portfolios are municipal securities and may be subject to market volatility and fluctuation.
Please carefully consider the plan's investment objectives, risks, charges, and expenses before investing. For this and other information on any 529 college savings plan managed by Fidelity, contact Fidelity for a free Fact Kit, or view one online. Read it carefully before you invest or send money.