my529 discontinues investments in the Public Treasurers’ Investment Fund
my529 closed the Public Treasurers’ Investment Fund (PTIF) investment option on July 11, 2019.
Investments in the Public Treasurers’ Investment Fund investment option have been moved to the FDIC-Insured investment option.
Also, within the customized options, my529 shifted investments in the Public Treasurers’ Investment Fund to FDIC-insured accounts.
Your client’s account balance and investment options other than PTIF were not affected by the change.
The switch to FDIC-insured investments from PTIF did not count as an investment option change.
Why did my529 close PTIF?
my529 closed 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 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 closed PTIF investments and moved 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.
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 was no change in value of your client’s my529 units after the change.