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As investors, we feel great when our strategies result in gains. But unfortunately, investing can also sometimes result in losses. As we know from history, it is inevitable that markets go up and they go down, too. Any investment, including 529 plans, carries the assumption of risks. These risks even include the potential loss of principal. To best weather market corrections, advisors commonly suggest that investors employ a long-term savings strategy and maintain a diversified portfolio of investments.
For those saving for college, savings strategies are also often based on the length of time available to save, your level of comfort with risk, and your personal savings goals. There is not a one-size-fits-all strategy to investing and saving for college; it is personal and requires each person to consider multiple factors like savings goals, timing, risk tolerance and others. These factors may change with time, so it is important to continually review your investment strategy.
Ohio's 529 Plan CollegeAdvantage, offers customers a choice of 24 portfolios and options for your personal strategy. These include age-based portfolios that automatically exchange to more conservative investments as your child ages; risk-based portfolios you choose based on your level of comfort with risk; and individual investment options that allow you to select and maintain whatever mix of options you wish from higher-risk stock options to the most conservative FDIC-insured 529 bank savings and CD options.
CollegeAdvantage also offers the tax advantages of investing with a 529 plan. Ohio taxpayers get even more; a deduction from Ohio taxable income for contributions up to $4,000 per beneficiary, per year with unlimited carryforward.
To help you monitor your investments and make investment decisions that are right for your savings strategy, we provide online tools and calculators. For additional information about college savings strategies, please visit www.CollegeAdvantage.com. These resources are provided for informational purposes only, and we cannot and do not provide investment advice, so you should also consult your financial advisor or tax consultant about your personal situation and savings goals.
Posted on October 27, 2015