Direct rollover My529 (UT) -> Vanguard (NV): should I do it?

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walletless
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Direct rollover My529 (UT) -> Vanguard (NV): should I do it?

Post by walletless » Thu Jul 11, 2019 12:12 pm

For my 7 year old, I have a 529 with UT (My529.org). I have set it to the age-based aggressive global plan which I am quite happy with.

Recently I switched employers, and my new employer has their 401K with Vanguard. This has given me an opportunity to consolidate everything into Vanguard. I have already rolled over my previous 401K's into Vanguard, and all my other non-taxable/Roth and Taxable/Brokerage accounts are at Vanguard.... except the 529 account above.

I am really contemplating moving from My529 to Vanguard's Aggressive age-based plan. The fee difference is minimal, and not the deciding factor here (with a difference of ~0.02 I do not think that will matter much). However, Vanguard's age-based aggressive plan only consists of stocks and bonds, whereas My529's plan starts holding more cash-equivalent assets as the kid gets closer to 18 years age. This is the main factor that I am contemplating on whether I should do the rollover or not.

So my question to all you fine Bogleheads is this - does the difference of holding bonds vs. principle preservation assets really make a large difference. Should I over-index on that when considering whether to consolidate everything under one roof?

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Tyler Aspect
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Re: Direct rollover My529 (UT) -> Vanguard (NV): should I do it?

Post by Tyler Aspect » Thu Jul 11, 2019 3:20 pm

I would also look at NY 529 Direct Plan. It might be slightly better than Utah's offering.
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Re: Direct rollover My529 (UT) -> Vanguard (NV): should I do it?

Post by Grt2bOutdoors » Thu Jul 11, 2019 3:42 pm

walletless wrote:
Thu Jul 11, 2019 12:12 pm
For my 7 year old, I have a 529 with UT (My529.org). I have set it to the age-based aggressive global plan which I am quite happy with.

Recently I switched employers, and my new employer has their 401K with Vanguard. This has given me an opportunity to consolidate everything into Vanguard. I have already rolled over my previous 401K's into Vanguard, and all my other non-taxable/Roth and Taxable/Brokerage accounts are at Vanguard.... except the 529 account above.

I am really contemplating moving from My529 to Vanguard's Aggressive age-based plan. The fee difference is minimal, and not the deciding factor here (with a difference of ~0.02 I do not think that will matter much). However, Vanguard's age-based aggressive plan only consists of stocks and bonds, whereas My529's plan starts holding more cash-equivalent assets as the kid gets closer to 18 years age. This is the main factor that I am contemplating on whether I should do the rollover or not.

So my question to all you fine Bogleheads is this - does the difference of holding bonds vs. principle preservation assets really make a large difference. Should I over-index on that when considering whether to consolidate everything under one roof?
I hold the MY529plan, if you don't like the age-based offerings because they use cash equivalent accounts, one could always create their own custom mix. Choosing which assets you hold and at what percentages. At one time I held their age based allocation plan, but didn't like how conservative it became after they tinkered with it a couple of years ago - so I created my own custom mix. You could do that, or you could move it to Vanguard - but there are no assurances that Vanguard won't tinker with the formula either.
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions

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