As college tuitions continue to rise and student debt continues to grow, prepaid tuition plans can be an option for clients to keep costs down.
One such plan, Private College 529, is owned and operated by 278 private colleges and universities in the U.S. Through the plan, clients can purchase tuition at today’s prices and redeem tuition certificates at any of the participating colleges or universities for up to 30 years.
Recently all 14 Associated Colleges of the Midwest (ACM) joined the plan. The ACM is a group of independent liberal arts colleges in Illinois, Iowa, Minnesota, Wisconsin and Colorado.
“This is the first time we have reached 100 percent of an association of a group of schools. This says we are doing something important about affordability,” says Nancy Farmer, president of Private College 529 Plan.
If a child goes to a college or university not participating in the plan, the assets can still be used penalty free and the tax benefit stays with it, says Farmer.
In addition, 89 percent of plan participants replied in a recent survey that the plan limited the amount of money they borrowed to pay for college, she added.
“Participating in the plan does not impact admissions at all,” says Farmer.