Products January 8, 2002

Individual Fund Option – Arrives for New Mexico 529

August 1, 2002 (PLANSPONSOR.com) - Investors in the Arrive Education Savings plan now have a new set of investment choices with the offering of 14 mutual fund portfolios.
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The Arrive Education program, a 529 college savings plan sponsored by The Education Trust Board of New Mexico, now has a lineup of 23 investment options.

Created as part of the Small Business Jobs Protection Act of 1996, these state-administered college savings plans were turbocharged by the Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA) that, among other things, made qualified withdrawals from the plans free of federal income taxes.

States have responded by rolling out new and enhanced plans that provide participants with broader arrays of investment choices and higher funding limits.

The New Mexico plan is managed by Schoolhouse Capital, a subsidiary of State Street Corporation, and is distributed by Evergreen Investments, Prudential Financial, and AIG SunAmerica Capital Services.

According to a media release, the 14 new fund offerings include those in:

  • Large Cap
  • Mid/Multi-Cap
  • Small Cap
  • International
  • Fixed Income.

The plan also incorporates investment management from a number of other firms including Jennison Associates, Marsico Capital Management LLC, Harris Associates L.P./Oakmark Funds, Janus Capital Management, Thornburg Investment Management, Credit Suisse Asset Management, Pilgrim Baxter & Associates, Bank of Ireland Asset Management, and State Street Global Advisors.

Each firm contributes a number of funds to the program selected by a team of investment management specialists on the basis of fundamental and quantitative style characteristics, return and risk characteristics.

With the addition of individual mutual fund portfolio options, the Arrive plan now offers three tiers of investments (or any combination of the three):

  • an age-based portfolio option which automatically “graduates” over time to different portfolio strategies based on their beneficiary’s age
  • a custom choice portfolio option which provides an opportunity to invest in a combination of eight portfolios that are balanced based on market conditions to maintain their target allocations
  • the individual mutual fund portfolio option

More information is available at the plan’s Web site www.arrive529.com .

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