NYsaves 529 for Junior in HS

Submitted by Mantaray14 t3_zzujeg in personalfinance

Hi everyone, My son is 16 (junior in HS) and his 529 plan is currently allocated among aggressive and moderate options (I know we should have addressed this earlier). There is a conservative option that is heavily allocated to bonds, however I am wondering does this make sense if bond prices are going down? There are some individual options as well (Inflation protected securities, Bond market index etc…), but everything seems to me losing money right now. Any insight on how to navigate this market and situation (i.e. son will be going to college in less than 2 years) would be appreciated!

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dmaxd123 t1_j2do81e wrote

personally I wouldn't change the current funds, i would just change where future funds go.

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Citryphus t1_j2do9cz wrote

I'm not sure you should change anything. The age-based portfolios will continue to move you into bonds, and while bond prices may continue to fall short-term, bond yields are up. In a way you should be glad bond prices have fallen while you continue to buy them. If your risk tolerance had you allocated somewhere between aggressive and moderate all this time, why change now? Are you now unwilling to risk any decline in the balance in the next 2-6 years?

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Mantaray14 OP t1_j2dppuw wrote

I guess the idea is he’s leaving for college within 2 years, so we don’t want to 30% or more as we start to need/withdraw the funds. But I guess if he’s in college for the next 4-6 years (or more). Maybe I’m being a little too anxious? As some have said, saying aggressive, moderate could be a plus in certain scenarios…

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Citryphus t1_j2dsadg wrote

Despite the downward trajectory of bonds over the last year, in general the bonds will not be as volatile as stocks. At age 17 the moderate portfolio is all in bonds and short-term reserves, and the aggressive portfolio is 25% stocks. If you've split 50/50 you're only 13% in stocks and even if they got cut in half you'd only be down 6-7% and your bond funds would almost surely go up. I think the risk of a 30% haircut between now and college graduation is extremely low.

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MountainStoneMist t1_j2dt89b wrote

>The age-based portfolios will continue to move you into bonds, and while bond prices may continue to fall short-term, bond yields are up.

I wonder if OP is in the age based portfolio or individual portfolios.

Individual: https://www.nysaves.org/home/which-investments/individual-portfolios.html

Age based: https://www.nysaves.org/home/which-investments/age-based-options.html

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