Paying for College Blog

Prepaid College Plans Get Second Look

Associated Press reports today that prepaid college plans are getting another look in light of the market downturn which has severely impacted the market returns of 529 plans: 

529 Plans: Cautionary Tales

New York Times article today highlights risks in not monitoring your asset allocation strategy for 529 plans.  It highlights several instances where age-based 529 plans set up for students 1-2 years away from starting college had a high equity (or stock) allocation.  With various U.S. market indices declining by 30-40% in 2008, these 529 plans were significantly impacted on the downside with little time to recover before these funds from the 529 plans would be needed to cover college expenses. 

Key insights: