Target Portfolios

These diversified portfolios provide a fixed, or static, targeted asset allocation of equity (stock), fixed income (bond), and money market investments. You can choose from seven portfolio options, ranging from aggressive to conservative. Your portfolio will be re-balanced on an ongoing basis to maintain your targeted asset allocation. Unlike the age-based portfolio, the target portfolios do not adjust based on the age of the beneficiary.

Choose your portfolio based on your risk comfort level. The most aggressive portfolio (Fund 100) is composed solely of equity mutual funds (75 percent domestic equity and 25 percent international equity). The most conservative portfolio (Fixed Income Fund) is composed of 50 percent fixed income and 50 percent money market mutual funds.

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► Fund 100 – The most aggressive of the target portfolios seeks maximum capital appreciation and is invested 100 percent in a broad range of domestic and international equity mutual funds. This strategy is only appropriate for investors who have longer time horizons, who are comfortable with an increased level of risk while seeking higher longer-term returns, or who use this investment option as part of an overall college savings strategy that includes less aggressive investments.

► Fund 80 – This aggressive target portfolio seeks a high level of capital appreciation and some income and is invested 80 percent in a broad range of domestic and international equity mutual funds with the remaining 20 percent invested in fixed income mutual funds.

► Fund 60 – This moderately aggressive target portfolio seeks moderate capital appreciation and income and is invested 60 percent in a broad range of domestic and international equity mutual funds with the remaining 40 percent invested in fixed income mutual funds.

► Fund 40 – This conservative growth target portfolio seeks moderate income and capital appreciation and is invested 60 percent in fixed income mutual funds with the remaining 40 percent invested in a broad range of domestic and international equity mutual funds.

► Fund 20 – This income-oriented target portfolio seeks income and some capital appreciation by investing 60 percent in fixed income mutual funds, 20 percent in money market mutual funds, and 20 percent in a broad range of domestic and international equity mutual funds.

► Fund 10 – This conservative income-oriented target portfolio seeks income and some capital appreciation. The asset allocation reflects a lower-risk investment approach, allocating 40 percent to money market mutual funds, 50 percent to short-term bond mutual funds, and 10 percent to domestic and international equity mutual funds.

► Fixed Income Fund – The most conservative of the target portfolios seeks to preserve the principal investment with less volatility than an all-bond portfolio while providing modest current income by investing 50 percent in money market mutual funds and 50 percent in short-term bond mutual funds.

Investment Products: Not FDIC Insured. No Bank Guarantee. May Lose Value

The Bright Directions College Savings Program is part of the Illinois College Savings Pool and is designed to qualify as a qualified tuition program under the provisions of Section 529 of the Internal Revenue Code. The Bright Directions College Savings Program is sponsored by the State of Illinois and administered by the Illinois State Treasurer, as Trustee. Union Bank & Trust Company serves as Program Manager, and Northern Trust Securities, Inc. acts as Distributor.

You should be aware that other states may sponsor their own qualified tuition plans and may offer a state tax deduction or other benefits that are limited to residents who invest in that plan. You should consult with a tax advisor about state and local taxes.

Withdrawals used to pay for qualified higher education expenses are income TAX-FREE (Federal and State of Illinois). Qualified higher education expenses include tuition, fees, books, supplies and equipment required for enrollment at a qualified institution of higher education. Room and board is considered a qualified higher education expense if the student is enrolled on at least a half time basis.

Every individual's tax situation is different, and it is important to consult a qualified tax advisor regarding the application of the Program’s benefits to your own individual situation.

There is no guarantee that any investment portfolio will achieve its investment goals. The value of an account will go up or down based on the performance of the Portfolio in which the account is invested. When funds are withdrawn, they may have more or less than the total contributions made to the account. Past investment performance is no guarantee of future results.

Investments in the Bright Directions College Savings Program are not guaranteed or insured by the State of Illinois, the Illinois State Treasurer, Union Bank & Trust Company, Northern Trust Securities, Inc., the Federal Deposit Insurance Corporation or any other entity. Investors should read carefully and consider the investment objectives, risks, fees, and expenses contained in the Program Disclosure Statement (issuer's official statement) before investing. The Program Disclosure Statement, which contains additional information about the plan and municipal fund securities, is available from your financial advisor.