Putnam 529 for America includes the use of absolute return investment strategies – designed to target positive three-year returns above inflation, as measured by T-bills and with lower relative volatility.
To encourage participation in the new plan, Putnam announced it will waive sales charges for participants who transfer funds over from existing 529 plans, as well as waive the annual maintenance fees until 2012.
The plan offers several different portfolio options:
- Age-based, asset allocation portfolios: Actively-managed portfolios that automatically adjust annually over time, becoming more conservative as a child approaches college age, shifting from a mix of investments composed primarily of stock funds to one with more fixed-income funds and money-market funds. Within this, Conservative, Moderate or Aggressive investment options are available.
- Goal-based, asset allocation portfolios: Actively-managed portfolios that keep the same allocation mix, regardless of a child’s age. Balanced, Growth and Aggressive Growth investment options are available.
- Individual fund investment options: Investors may build their own portfolios from a selection of 11 stock, bond and cash funds overall from Putnam and other fund companies.
- Putnam Absolute Return Funds: The investment choices include Putnam’s four target Absolute Return Funds. The funds are designed to help pursue college savings goals with potentially lower volatility than more traditional mutual fund investments.
In addition, the plan offers a number of features, including a comprehensive tuition payment analysis tool to more accurately estimate how much in tuition payments plan participants’ current savings may generate based on historical analyses. The Putnam plan also will provide advisers with a portal to manage all of their clients’ Putnam 529 plans with a single log-in as well as other data, analytical, and educational tools to help them better serve their clients.