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Your Investment Options
You should consider several factors when you develop your own personal investment strategy. What are your savings goals? Are your plans more immediate or down the road? Can you afford a high level of risk, or do you need to invest more conservatively?
Primarily, the purpose of this plan is to help you meet your financial goals for retirement. However, other situations arise—a child's college education, a new house. These needs have different time frames and levels of urgency.
Once you've determined your savings goals, risk tolerance, and time horizon, it's time to put your investments to work for you. Here’s a summary of the investment options you have to choose from at PSEG.
Core Fund Options
You can invest in seven core funds, three pre-mix portfolios, and ten Target Retirement funds. A pre-mix portfolio is a pre-determined combination of the investment funds offered through the Thrift Plan. Investment experts selected the percentages for each of the funds that make up the portfolios to accommodate three levels of risk and return: conservative, moderate, and aggressive.
The pre-mix portfolios are made up of a combination of the core funds listed below, except the Vanguard Mid-Cap Index Fund. You also can invest in any fund separate from a portfolio.
- Stable Value Fund
- Diversified Bond Fund
- Large Company Stock Index Fund (Vanguard Institutional Index Fund)—ticker symbol: VIIIX
- Institutional Developed Markets Index Fund—ticker symbol: VIDMX
- Mid-Cap Index Fund—ticker symbol: VMCIX
- Small-Cap Index Fund—ticker symbol: VSCIX
- Enterprise Common Stock Fund—ticker symbol: PEG
The Target Retirement funds are monitored by an investment manager who chooses a mix of mutual funds to create a diversified portfolio with a risk level related to a targeted retirement date (usually the year in the portfolio's name). By the time the target date arrives, the portfolio is conservatively managed with stable investments.
- Target Retirement Income Fund
- Target Retirement 2010 Fund
- Target Retirement 2015 Fund
- Target Retirement 2020 Fund
- Target Retirement 2025 Fund
- Target Retirement 2030 Fund
- Target Retirement 2035 Fund
- Target Retirement 2040 Fund
- Target Retirement 2045 Fund
- Target Retirement 2050 Fund
For daily updates on rates of return, visit the "About the Funds and Their Performance" page on Your Benefits Resources™ online.
Schwab Personal Choice Retirement Account™ (PCRA)
In addition to the core funds, PSEG employees also can invest in a Schwab Personal Choice Retirement Account™ (PCRA).
For more information on the funds and rates of return, log onto Your Benefits Resources.
Conservative Portfolio
| What's in it? | 40% Stable Value Fund 20% Diversified Bond Fund 20% Large Company Stock Index Fund 10% Vanguard Institutional Developed Markets Index Fund 10% Vanguard Small-Cap Index Fund |
| What sort of person might invest in this fund? | Someone comfortable with a low-to-moderate degree of risk. |
| Time frame before money is needed? | 3 to 5 years (for the average investor). |
Moderate Portfolio
| What's in it? | 25% Large Company Stock Index Fund 20% Stable Value Fund 20% Diversified Bond Fund 20% Vanguard Institutional Developed Markets Index Fund 15% Vanguard Small-Cap Index Fund |
| What sort of person might invest in this fund? | Someone comfortable with a moderate-to-high degree of risk. |
| Time frame before money is needed? | 5 to 10 years (for the average investor). |
Aggressive Portfolio
| What's in it? | 30% Large Company Stock Index Fund 25% Vanguard Small-Cap Index Fund 25% Vanguard Institutional Developed Markets Index Fund 20% Diversified Bond Fund |
| What sort of person might invest in this fund? | Someone comfortable with a high degree of risk. |
| Time frame before money is needed? | 10 years or more (for the average investor). |
Stable Value Fund
| What's in it? | Primarily, various traditional and synthetic Guaranteed Investment Contracts (GICs). |
| What's the objective? | Seeks to provide a stable principle and rates of return that are competitive with current market conditions for fixed income investments. |
| What sort of person might invest in this fund? | Someone who seeks to minimize risk. |
| Time frame before money is needed? | Less than 3 years (for the average investor). |
| Wall Street Journal Mutual Fund Quotation Listing? | Since this fund is comprised of various contracts which are not publicly traded, the fund is not listed in the newspaper. |
| Who is the Investment Manager? | INVESCO Fixed Income 400 West Market Street, Suite 3300 Louisville, KY 40202 |
Diversified
Bond Fund
| What's in it? | Primarily, bonds of the U.S. Treasury and various government agencies. |
| What's the objective? | Seeks a high level of current income, consistent with lower investment risk. |
| What special risks are there? | Interest rate changes. |
| What sort of person might invest in this fund? | Someone who seeks to minimize risk. |
| Time frame before money is needed? | Less than 3 years (for the average investor). |
| Wall Street Journal Mutual Fund Quotation Listing? | N/A since it's a privately managed fund. |
| Who is the Investment Manager? | BlackRock Financial Management 40 East 52nd Street New York, NY 10022 www.blackrock.com 212-754-5560 Founded: 1988 |
Large Company Stock Index Fund (Vanguard Institutional Index Fund)—ticker symbol: VIIIX
| What's in it? | Primarily, large U.S. company stocks, which are included in the S&P 500. |
| What's the objective? | Seeks to match the investment performance of the S&P 500 Index. |
| What special risks are there? | Broad market movement. |
| Historical returns over
the past ... (as of 12/31/06) |
2006: 15.66% 5-year annualized rate: 6.07% For more information on the funds and rates of return, log onto Your Benefits Resources |
| What sort of person might invest in this fund? | Someone comfortable with a moderate-to-high degree of risk. |
| Time frame before money is needed? | 5 years or more (for the average investor). |
| Wall Street Journal Mutual Fund Quotation Listing? | "InstPlus," under the Vanguard Group Ticker symbol: VIIIX |
| Who is the Investment Manager? | The Vanguard Group Institutional Division P.O. Box 2600 Valley Forge, PA 19482-2600 1-800-523-8066 Founded: 1974 |
Institutional Developed Markets Index Fund—ticker symbol: VIDMX
| What's in it? | Primarily, stocks of foreign-based companies. |
| What's the objective? | Seeks capital growth and income by investing primarily in companies based outside the United States. |
| What special risks are there? | Political currency exposure. |
| What sort of person might invest in this fund? | Someone comfortable with a high degree of risk. |
| Time frame before money is needed? | 10 years or more (for the average investor). |
| Wall Street Journal Mutual Fund Quotation Listing? | Ticker symbol: VIDMX |
| Who is the Investment Manager? | The
Vanguard Group Institutional Division P.O. Box 2600 Valley Forge, PA 19482-2600 1-800-523-8066 Founded: 1974 |
Mid-Cap Index Fund—ticker symbol: VMCIX
| What's in it? | Primarily, stocks of mid-sized U.S. companies. |
| What's the objective? | Seeks long-term growth by investing in companies with strong potential for significant growth in earnings and capital appreciation. |
| What special risks are there? | Mid-sized growth companies have higher volatility than large companies. |
| What sort of person might invest in this fund? | Someone comfortable with a high degree of risk. |
| Time frame before money is needed? | 10 years or more (for the average investor). |
| Wall Street Journal Mutual Fund Quotation Listing? | Ticker symbol: VMCIX |
| Who is the Investment Manager? | The
Vanguard Group Institutional Division P.O. Box 2600 Valley Forge, PA 19482-2600 1-800-523-8066 Founded: 1974 |
Small-Cap Index Fund—ticker symbol: VSCIX
| What's in it? | Primarily, small U.S. capitalization companies that are considered undervalued by the fund manager. |
| What's the objective? | Seeks above-average, long-term total returns in capitalization and earnings. |
| What special risks are there? | Undervalued companies have higher volatility. |
| What sort of person might invest in this fund? | Someone comfortable with a high degree of risk. |
| Time frame before money is needed? | 10 years or more (for the average investor). |
| Wall Street Journal Mutual Fund Quotation Listing? | Ticker symbol: VSCIX |
| Who is the Investment Manager? | The Vanguard Group Institutional Division P.O. Box 2600 Valley Forge, PA 19482-2600 1-800-523-8066 Founded: 1974 |
Enterprise Common Stock Fund—ticker symbol:PEG
| What's in it? | Primarily, common stock of Public Service Enterprise Group, Inc. |
| What's the objective? | Contributions to this fund are invested in Enterprise Inc. common stock, which the plan's Trustee purchases from time to time through open market transaction or directly from Enterprise. |
| What special risks are there? | Single stock portfolio. |
| What sort of person might invest in this fund? | Someone comfortable with a high degree of risk. |
| Time frame before money is needed? | 5 years or more (for the average investor). |
| Wall Street Journal Mutual Fund Quotation Listing? | NYSE Composite Transactions, "PubSvcEnt" Ticker symbol: PEG |
| Who is the Investment Manager? | N/A |
Target Retirement Income Fund
| What's in it? | The underlying funds are the Vanguard Total Stock Market Index fund, Vanguard Total Bond Market Index fund, Vanguard European Stock Index fund, Vanguard Pacific Stock Index fund, Vanguard Emerging Markets Stock Index fund, Vanguard Inflation-Protected Securities fund, Vanguard Prime Money Market fund. |
| What's the objective? | The fund invests in mutual funds using an asset allocation strategy designed for investors who are already retired. The fund’s asset allocation will become more conservative over time. |
| What sort of person might invest in this fund? | Someone seeking a high level of income and for those who are already retired. |
| Time frame before money is needed? | This fund is designed for individuals who currently make withdrawals during retirement |
| Who is the Investment Manager? | The Vanguard Group 800-523-8066 Founded: 1975 |
Target Retirement 2010 Fund
| What's in it? | The underlying funds are the Vanguard Total Stock Market Index fund, Vanguard Total Bond Market Index fund, Vanguard European Stock Index fund, Vanguard Pacific Stock Index fund, Vanguard Emerging Markets Stock Index fund, Vanguard Inflation-Protected Securities fund. |
| What's the objective? | The fund invests in mutual funds using an asset allocation strategy designed for investors planning to retire between 2008 and 2012. The fund’s asset allocation will become more conservative over time. |
| What special risks are there? | |
| What sort of person might invest in this fund? | Someone seeking both a reasonable level of income and long-term growth of capital and income. Those seeking to retire between 2008 and 2012. |
| Time frame before money is needed? | 1 to 4 years (based on a retirement age of 65). |
| Wall Street Journal Mutual Fund Quotation Listing? | |
| Who is the Investment Manager? | The Vanguard Group 800-523-8066 Founded: 1975 |
Target Retirement 2015 Fund
| What's in it? | The underlying funds are the Vanguard Total Stock Market Index fund, Vanguard Total Bond Market Index fund, Vanguard European Stock Index fund, Vanguard Pacific Stock Index fund, Vanguard Emerging Markets Stock Index fund. |
| What's the objective? | The fund invests in mutual funds using an asset allocation strategy designed for investors planning to retire between 2013 and 2017. The fund’s asset allocation will become more conservative over time. |
| What sort of person might invest in this fund? | Someone seeking both a reasonable level of income and long-term growth of capital and income. Those seeking to retire between 2013 and 2017. |
| Time frame before money is needed? | 5 to 9 years (based on a retirement age of 65). |
| Who is the Investment Manager? | The Vanguard Group 800-523-8066 Founded: 1975 |
Target Retirement 2020 Fund
| What's in it? | The underlying funds are the Vanguard Total Stock Market Index fund, Vanguard Total Bond Market Index fund, Vanguard European Stock Index fund, Vanguard Pacific Stock Index fund, Vanguard Emerging Markets Stock Index fund. |
| What's the objective? | The fund invests in mutual funds using an asset allocation strategy designed for investors planning to retire between 2018 and 2022. The fund’s asset allocation will become more conservative over time. |
| What sort of person might invest in this fund? | Someone seeking both a reasonable level of income and long-term growth of capital and income. Those seeking to retire between 2018 and 2022. |
| Time frame before money is needed? | 10 to 14 years (based on a retirement age of 65). |
| Who is the Investment Manager? | The Vanguard Group 800-523-8066 Founded: 1975 |
Target Retirement 2025 Fund
| What's in it? | The underlying funds are the Vanguard Total Stock Market Index fund, Vanguard Total Bond Market Index fund, Vanguard European Stock Index fund, Vanguard Pacific Stock Index fund, Vanguard Emerging Markets Stock Index fund. |
| What's the objective? | The fund invests in mutual funds using an asset allocation strategy designed for investors planning to retire between 2023 and 2027. The fund’s asset allocation will become more conservative over time. |
| What sort of person might invest in this fund? | Someone seeking both a reasonable level of income and long-term growth of capital and income. Those seeking to retire between 2023and 2027. |
| Time frame before money is needed? | 15 to 19 years (based on a retirement age of 65). |
| Who is the Investment Manager? | The Vanguard Group 800-523-8066 Founded: 1975 |
Target Retirement 2030 Fund
| What's in it? | The underlying funds are the Vanguard Total Stock Market Index fund, Vanguard Total Bond Market Index fund, Vanguard European Stock Index fund, Vanguard Pacific Stock Index fund, Vanguard Emerging Markets Stock Index fund. |
| What's the objective? | The fund invests in mutual funds using an asset allocation strategy designed for investors planning to retire between 2028 and 2032. The fund’s asset allocation will become more conservative over time. |
| What sort of person might invest in this fund? | Someone seeking both a reasonable level of income and long-term growth of capital and income. Those seeking to retire between 2028 and 2032. |
| Time frame before money is needed? | 20 to 24 years (based on a retirement age of 65). |
| Who is the Investment Manager? | The Vanguard Group 800-523-8066 Founded: 1975 |
Target Retirement 2035 Fund
| What's in it? | The underlying funds are the Vanguard Total Stock Market Index fund, Vanguard Total Bond Market Index fund, Vanguard European Stock Index fund, Vanguard Pacific Stock Index fund, Vanguard Emerging Markets Stock Index fund. |
| What's the objective? | The fund invests in mutual funds using an asset allocation strategy designed for investors planning to retire between 2033 and 2037. The fund’s asset allocation will become more conservative over time. |
| What sort of person might invest in this fund? | Someone seeking both a reasonable level of income and long-term growth of capital and income. Those seeking to retire between 2033 and 2037. |
| Time frame before money is needed? | 25 to 29 years (based on a retirement age of 65). |
| Who is the Investment Manager? | The Vanguard Group 800-523-8066 Founded: 1975 |
Target Retirement 2040 Fund
| What's in it? | The underlying funds are the Vanguard Total Stock Market Index fund, Vanguard Total Bond Market Index fund, Vanguard European Stock Index fund, Vanguard Pacific Stock Index fund, Vanguard Emerging Markets Stock Index fund. |
| What's the objective? | The fund invests in mutual funds using an asset allocation strategy designed for investors planning to retire between 2038 and 2042. The fund’s asset allocation will become more conservative over time. |
| What sort of person might invest in this fund? | Someone seeking both a reasonable level of income and long-term growth of capital and income. Those seeking to retire between 2038 and 2042. |
| Time frame before money is needed? | 30 to 34 years (based on a retirement age of 65). |
| Who is the Investment Manager? | The Vanguard Group 800-523-8066 Founded: 1975 |
Target Retirement 2045 Fund
| What's in it? | The underlying funds are the Vanguard Total Stock Market Index fund, Vanguard Total Bond Market Index fund, Vanguard European Stock Index fund, Vanguard Pacific Stock Index fund, Vanguard Emerging Markets Stock Index fund. |
| What's the objective? | The fund invests in mutual funds using an asset allocation strategy designed for investors planning to retire between 2043 and 2047. The fund’s asset allocation will become more conservative over time. |
| What sort of person might invest in this fund? | Someone seeking both a reasonable level of income and long-term growth of capital and income. Those seeking to retire between 2043 and 2047. |
| Time frame before money is needed? | 35 to 39 years (based on a retirement age of 65). |
| Who is the Investment Manager? | The Vanguard Group 800-523-8066 Founded: 1975 |
Target Retirement 2050 Fund
| What's in it? | The underlying funds are the Vanguard Total Stock Market Index fund, Vanguard Total Bond Market Index fund, Vanguard European Stock Index fund, Vanguard Pacific Stock Index fund, Vanguard Emerging Markets Stock Index fund. |
| What's the objective? | The fund invests in mutual funds using an asset allocation strategy designed for investors planning to retire between 2048 and 2053. The fund’s asset allocation will become more conservative over time. |
| What sort of person might invest in this fund? | Someone seeking both a reasonable level of income and long-term growth of capital and income. Those seeking to retire between 2048 and 2053. |
| Time frame before money is needed? | 40 to 47 years (based on a retirement age of 65). |
| Who is the Investment Manager? | The Vanguard Group 800-523-8066 Founded: 1975 |
Schwab Personal Choice Retirement AccountTM (PCRA)
The PCRA is a self-directed brokerage account that allows you to invest in hundreds of stocks and mutual funds within your Thrift Plan account. It's offered by Charles Schwab & Co., Inc., member SIPC/NYSE, and is designed to provide experienced investors with increased investment choices. Here's an overview of the PCRA to help you evaluate if it's right for you.
Investment choices
With a PCRA, you can invest in:
- More than 3,000 mutual funds, including over 2,000 with no loads and no transaction fees through the Schwab Mutual Fund OneSource® service (except the Thrift Plan core funds).
- Any stock listed on the major U.S. exchanges, including over-the-counter stocks (except PSEG stock).
- Bonds and other fixed income investments, including CDs and Ginnie Maes (except debt instruments issued by PSEG).
- Money market funds.
In using your PCRA, you will be charged a $50 annual maintenance fee and commissions may apply on each trade. In addition, you must maintain a $500 balance in the Thrift Plan core fund options.
Responsibilities
To effectively use a PCRA, you are responsible for researching, planning, selecting, and managing your investments within the account. Therefore, those who are familiar with investing, keep up with the stock market, and have a long-term investing focus may find the PCRA option very appealing. To decide if the PCRA fits with your investment objectives, learn how to Invest Smarter.
Restrictions
The following are not permitted within the PCRA:
- Trading on margin and trade-away trades (trades placed by another broker that settle at Schwab).
- Investing in futures, commodities, precious metals, or currencies.
- Investing in PSEG securities (common stock, preferred stock, bonds).
- Placing puts, calls, or covered options.
- Investing in mutual funds if they are already offered as a core fund investment option.
Enrolling
To open a PCRA, you must:
- Order a PCRA Enrollment Kit—by calling 1-800-571-0400 and following the voice recognition prompts. The kit contains an enrollment guide, Schwab commission card, Schwab Online Investing and Your Complete List of Mutual Funds at Schwab brochures, and a PCRA Participant Limited Power of Attorney (LPOA) form.
- Complete and sign the LPOA form—which gives you the authority to trade within your PCRA.
- Return the LPOA form to Benefits Express—using the envelope enclosed in your PCRA Enrollment Kit. Once the form is received, a $50 annual maintenance fee will be deducted from your core funds (Note: The maintenance fee will be deducted from your account every year).
Please allow at least one week to have your account set up. During this time, you'll receive a Schwab PCRA Welcome Kit containing information to start using your PCRA.