Iowa Educational Savings Plans Trust

Guide to Choosing Investments

Follow this 3-step process to help you choose your investments.

Step 1: Assess your comfort level with risk

Before you choose your investments, consider your investment personality and how long you have to save before you use the funds.


If you think …

  • Big fluctuations in the market are bad, no matter how long your investment time horizon.

  • You will be using your savings sooner rather than later.

  • Bonds and short-term investments may be better for you than stocks because they are typically less volatile.


If you think …

  • Some market fluctuations are tolerable—but not too many.

  • You don’t plan on using your savings for at least 5 years.

  • A mix of stocks and bonds could be the way to go because you want to maintain the money in your account, but also have the potential to earn moderate interest.


If you think …

  • Market fluctuations are not a big deal.

  • Your savings won’t be used until further down the road.

  • Investing in more stocks than bonds may be a good option because despite the higher risk, there is a potential for higher returns.  

Step 2: Decide which strategy is right for you

To determine the investment approach you should take, decide which of these quotes sounds more like you when planning for higher education expenses. If saving for K-12 expenses, consider visiting our K-12 Goals and Investments page.

Step 3: Select your investments

Whether you choose an Age-Based Savings Track or the Individual Portfolios, each investment option covers all major asset classes – stocks, bonds and short-term reserves. Plus, the cost of your investments is the same. No matter which option you choose, you pay only $1.80 per year for every $1,000 you invest (0.18% applied annually).

Potential risk/reward varies depending on the type of investment option chosen. The risk/reward is less with short-term reserves, moderate with bond funds and more with stock funds. All investments are subject to risks. Investments in bonds are subject to interest rate, credit and inflation risk.

Find detailed descriptions for all of the investment options in the Program Description.

Program Description

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