John Hancock Investment Management adds stable value portfolio and reduces fees on John Hancock Freedom 529 education savings plan
On December 5, 2022, John Hancock Investment Management announced enhancements to the John Hancock Freedom 529 education savings plan. A new Stable Value Portfolio was added to the investment options, aimed at maintaining principal stability and maximizing income. The plan also saw fee reductions, effective October 15, 2022, which lowered total annual asset-based fees by converting several funds to lower-cost share classes, averaging a 12% reduction. The Freedom 529 plan helps families save for education, managing around $5 billion in assets.
- Introduction of the Stable Value Portfolio, enhancing investment options.
- Fee reductions averaging 12% for 17 of the 22 portfolios in the plan.
- The Freedom 529 plan manages assets totaling over $5 billion.
- More than 100,000 students have benefited from the plan.
- None.
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BOSTON, Dec. 5, 2022 /PRNewswire/ - John Hancock Investment Management, a company of Manulife Investment Management, today announced enhancements to the John Hancock Freedom 529 education savings plan. The plan has recently added a stable value portfolio to its investment options and reduced fees on the John Hancock Freedom 529 education savings plan.
"We understand that investors are prioritizing savings in this current environment and we are happy to help our customers continue their efforts to save for college, despite the current economic uncertainty," said John Bryson, head of investment consulting, education savings, and territory sales strategists at John Hancock Investment Management. "Fee reductions are helpful anytime, and Stable Value Portfolio provides an option that can help protect capital amid market volatility or simply serve as a diversification tool."
Stable Value Portfolio, which seeks to maintain stability of principal and maximize current income, joined John Hancock Freedom 529 education savings plan's lineup of investment options on December 1, 2022.
Stable Value Portfolio invests in a separately managed account contract (SAC) made up of broadly diversified fixed-income securities, and may invest up to
The underlying securities are managed by T. Rowe Price, and the SAC is issued by the contract issuer through an agreement with the Education Trust of Alaska that includes a guaranteed minimum crediting rate (yield) to be backed by the contract issuer. The crediting rate is reset monthly.
Money Market Portfolio and Short-Term Bond Portfolio have closed as a result of the addition of Stable Value Portfolio. All existing assets in these two portfolios have moved into Stable Value Portfolio.
Earlier this fall, the John Hancock Freedom 529 education savings plan also reduced total annual asset-based fees by converting several underlying funds to the lowest cost share classes available. The fee reductions were effective on October 15, 2022.
The share class for the underlying fund American Mutual Fund converted from Class F-1 to Class F-3, resulting in lower total annual asset-based fees for eight portfolios. Additionally, each existing T. Rowe Price underlying mutual fund converted from Investor Class to I Class.
These changes resulted in lower total annual asset-based fees for the portfolios that hold these underlying mutual funds. These combined underlying share class changes affected 17 of the plan's 22 portfolios, with fee reductions ranging from 6 to 37 basis points—an average reduction of
The John Hancock Freedom 529 plan has been available to help American families save toward higher education since 2001. The plan design offers multiple investment strategies from multiple asset managers and is overseen by the Education Trust of Alaska, John Hancock Investment Management, and T. Rowe Price, giving the plan additional investment oversight. The John Hancock Freedom 529 education savings plan has helped more than 100,000 students pay for college and currently has approximately 225,000 accounts in the program, with assets totaling over
1 John Hancock Freedom 529 Plan Disclosure Document, as of 10/15/22. |
2 T. Rowe Price, as of 9/30/22. |
Diversification does not guarantee a profit or eliminate the risk of a loss. |
A company of Manulife Investment Management, we serve investors through a unique multimanager approach, complementing our extensive in-house capabilities with an unrivaled network of specialized asset managers, backed by some of the most rigorous investment oversight in the industry. The result is a diverse lineup of time-tested investments from a premier asset manager with a heritage of financial stewardship.
Manulife Investment Management is the global brand for the global wealth and asset management segment of Manulife Financial Corporation. We draw on more than a century of financial stewardship and the full resources of our parent company to serve individuals, institutions, and retirement plan members worldwide. Headquartered in Toronto, our leading capabilities in public and private markets are strengthened by an investment footprint that spans 19 geographies. We complement these capabilities by providing access to a network of unaffiliated asset managers from around the world. We're committed to investing responsibly across our businesses. We develop innovative global frameworks for sustainable investing, collaboratively engage with companies in our securities portfolios, and maintain a high standard of stewardship where we own and operate assets, and we believe in supporting financial well-being through our workplace retirement plans. Today, plan sponsors around the world rely on our retirement plan administration and investment expertise to help their employees plan for, save for, and live a better retirement. Not all offerings are available in all jurisdictions. For additional information, please visit manulifeim.com.
If your state or your designated beneficiary's state offers a 529 plan, you may want to consider what, if any, potential state income-tax or other state benefits it offers, such as financial aid, scholarship funds, and protection from creditors, before investing. State tax or other benefits should be one of many factors to be considered prior to making an investment decision. Please consult with your financial, tax, or other professional about how these state benefits, if any, may apply to your specific circumstances. You may also contact your state 529 plan or any other 529 education savings plan to learn more about their features. Please contact your financial professional or call 866-222-7498 to obtain a Plan Disclosure Document or prospectus for any of the underlying funds. The Plan Disclosure Document contains complete details on investment objectives, risks, fees, charges, and expenses, as well as more information about municipal fund securities and the underlying investment companies that should be considered before investing. Please read the Plan Disclosure Document carefully prior to investing.
John Hancock Freedom 529 is an education savings plan offered by the Education Trust of Alaska, managed by T. Rowe Price, and distributed by John Hancock Distributors LLC through other broker-dealers that have a selling agreement with John Hancock Distributors LLC. John Hancock Distributors LLC is a member of FINRA and is listed with the Municipal Securities Rulemaking Board (MSRB). © 2022 John Hancock. All rights reserved.
529 PLANS ARE NOT FDIC INSURED, MAY LOSE VALUE, AND ARE NOT BANK OR STATE GUARANTEED.
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SOURCE John Hancock Investment Management
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