Risk Based Investment Options
Consider this if: You're an experienced investor and want added control over your investment option's diversification and risk strategy.
Risk Based investment options let you align your investment objectives with your risk tolerance level, giving you more control of how you want to hit your goals.
With the Risk Based Investment Options, you can select from a range of investment types suitable for a variety of risk profiles and asset allocation blends. Each of these Investment Options invests in multiple mutual funds (and, in the case of the Conservative Allocation Option, in a funding agreement). Each Investment Option has a different investment objective and investment strategy and is subject to different investment risks.
Most investment options include index and actively managed choices. Index Funds are designed to track a benchmark index. Active management, by contrast, is managed using research, forecasts, and their own experience to make investment decisions.
No matter which option(s) you choose, it's important to note that once you’ve selected an investment, the funds will remain there until you select another.
How Risk Based Investment Options work
These investment options let you choose the mix of assets that align with your investment objectives and strategy.
The allocations to the underlying mutual funds in the Risk Based investment options do not change automatically as the beneficiary ages as they do in the enrollment year options. Investments will remain in the Risk Based investment options until the account owner instructs the Plan to move them to another investment option. The Board may change the asset allocations and underlying mutual funds for these investment options (as well as for the other investment options) at any time.
| Investment Name | Risk Level | Investment Objective | Allocation | ||
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| Aggressive Allocation Option | Aggressive | This Investment Option seeks a favorable long-term return by investing in mutual funds that invest primarily in equity securities and, to a lesser extent, in mutual funds that primarily invest in debt securities. |
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| Moderate Allocation Option | Moderate | This Investment Option seeks moderate growth by investing in a mix of mutual funds that invest in a diversified mix of asset classes. |
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| Conservative Allocation Option | Conservative to Moderate | This Investment Option seeks a conservative to moderate total return by investing in a funding agreement and mutual funds that invest primarily in debt securities and, to a lesser extent, by investing in mutual funds that invest primarily in equity securities. |
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The investment options are subject to the risks of the underlying funds including the loss of principal.
Things to consider
Changing your investments
Once you invest in a particular investment option, you can transfer contributions and any earnings to another investment option up to twice per calendar year or upon a transfer of funds to a Minnesota College Savings Plan account for a different beneficiary.
Periodically reviewing your investments
It's a good idea to periodically reevaluate your investment strategy as your goals, investment horizon, and personal situation changes—for example, annually at tax time, on a yearly basis if your income changes, or upon the birth of another child.
More to explore
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