my529 discontinues investments in the Public Treasurers’ Investment Fund
my529 will close the Public Treasurers’ Investment Fund (PTIF) investment option on July 11, 2019. It was the first option offered by the plan.
Investments in the Public Treasurers’ Investment Fund investment option will move to the FDIC-Insured investment option.
Within the customized options, investments in the Public Treasurers’ Investment Fund will also shift to FDIC-insured accounts.
Your account balance and investment options other than PTIF will be unaffected. No action is required on your part.
Not an investment option change
The switch to FDIC-insured investments from PTIF will not count as an investment option change.
However, if you’d like to modify your investment option prior to or after July 11, you can—the IRS allows up to two account owner-directed investment option changes per calendar year.
Closed to new investors on May 10, 2019
PTIF will be closed to new investors on May 10, 2019.
Account owners invested in PTIF investment option on this date will still be able to make transactions, including contributions, withdrawals, or an option change, with their account(s) until July 11.
Why is my529 closing PTIF?
my529 is closing PTIF to streamline its investment offerings.
The Public Treasurers’ Investment Fund, an underlying investment managed by the Utah State Treasurers’ Office, was the first investment offered by my529 (formerly named the Utah Educational Savings Plan) in 1996.
As my529 has grown, we have expanded our offerings. my529 now features two other underlying investments similar to PTIF: (1) the FDIC-Insured investment option and (2) the new PIMCO Interest Income Fund.
After the end of business on July 11, my529 will close PTIF investments and move the funds into the FDIC-insured accounts.
Insurance with FDIC available: Money invested in FDIC-insured accounts, unlike investments in PTIF, is insured by the Federal Deposit Insurance Corporation (FDIC) up to the maximum amount set by federal law, which is $250,000 per investor at each bank.
Contributions and earnings in the FDIC-insured accounts for each my529 account owner are held by Sallie Mae Bank (90 percent) and U.S. Bank (10 percent).
Because of the FDIC insurance component, my529 decided to move investments to the FDIC-insured accounts.
Seamless exchange: The FDIC-Insured investment option/underlying investment and PTIF both have a $1 per unit value, which makes this a unit-for-unit (similar to a “share”) exchange. There will be no change in value of account owner units after the change.
Will fees go up?
The total annual administrative asset fee may go up, depending on where you live and how you have invested in PTIF.
Previously, Utah resident account owners invested in the PTIF investment option did not pay an annual administrative asset fee. Utah resident account owners whose static investment changes to the FDIC-Insured investment option will now pay an administrative asset fee of 0.130 percent, or $1.30 per $1,000 invested. The fee will not begin to be assessed until July 31, 2019. The fee is assessed monthly on the balance of the account on the last business day of the month.
For non-Utah resident account owners, the annual administrative asset fee will be reduced. Non-Utah resident account owners paid 0.160 percent for investments in the PTIF investment option—or $1.60 per $1,000 invested—and the shift to the FDIC-Insured investment option will lower the fee to 0.130 percent.
Account owners who have selected PTIF as an underlying investment for their customized investment option will see no change in fees with the conversion to FDIC-insured accounts.
my529 will temporarily suspend Account Access for a few hours beginning at 2 p.m. MT on July 11 so the change can be implemented.
my529 will notify account owners prior to the change.