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Could bond losses derail my college savings plan? July 22, 2013 ET New York (Money Magazine) -- My kids' 529s are in age-based funds with lots of bonds. Is that OK if rates rise? -- Chris Berk, Westerville, Ohio Though prices on existing bonds fall when interest rates rise, you're unlikely to face losses similar to what a bad year in stocks could generate. Plus, 529 plans' age-based funds -- invested more conservatively as kids approach college age -- tend to hold bonds with short or intermediate maturities (less than 10 years), dampening possible declines. Still, says Christine Benz, director of personal finance at Morningstar, if you're nervous about rates and college bills are less than five years out, you could move some of your 529 to a money-market or short-term-bond fund (maturities under five years) in your plan. Leave money slated for college's later years or grad school untouched. And remember that you can move a 529's existing investments typically only once a year.	Sign up News Breaking Financial News Be the first to know when there is breaking financial news with timely alerts delivered straight to your inbox. Markets Captain's Blog FORTUNE managing editor Andy Serwer keeps tabs on Wall Street. Market Wrap A complete roundup of each day's trading activity. Morning Markets Today's trading: What you need to know. The Term Sheet Receive Fortune's newsletter on all the deals that matter, from Wall Street to Sand Hill Road. Technology Apple 2.0 Fortune's Philip Elmer-DeWitt brings you Mac news from outside the reality distortion field. Big Tech Fortune's Michal Lev-Ram covers the digital giants. Careers Ask Annie Mondays Anne Fisher answers career-related questions and offers helpful advice for business professionals. Postcards Fortune editor at large Pattie Sellers shares fascinating, fun and valuable insights into people who sit at the pinnacle of power. Personal Finance The Help Desk Tips for saving and spending smarter. Ask the Expert Our readers toughest market questions answered every Friday.
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