Tomorrow’s Tuition at Today’s Prices? Consider a Private College 529 Plan
It’s entirely natural that parents should have high hopes for their children. Aspirations vary, but aside from health and happiness, for many parents the chance of their precious offspring benefiting from a private undergraduate higher education ranks highly. The only problem, for many, is the rising cost of such an education.
According to the report The Condition of Education 2011, published by the National Center for Education Statistics, the average tuition cost at private not-for-profit institutions stands at $24,000 for four-year programs. Of course, as an average, this is just the tip of the iceberg. Take a quick look at the U.S. Department of Education’s College Affordability and Transparency Center and it’s easy to see that tuition costs can easily reach $40,000 and more. Whichever way you look at it, it’s hardly an insignificant amount. The problem is only exacerbated by the relentless rise in tuition fees. It’s a climb that’s not likely to end anytime soon, so those parents with children in their early years of education seemingly have every reason to be concerned.
Formerly known as an Independent 529 Plan, a Private College 529 Plan can help parents and wider family members save up to $231,350, making attendance at private colleges and universities a feasible and more affordable option for many students.
The Benefits of a Private College 529 Plan
– The plans offer a guaranteed rate of return, rising in value at the same rate of the tuition costs for institutions enrolled in the program. In essence, this return locks in tuition fees at today’s prices and avoids any tuition inflation. If tuition fees rise by 5% per annum, the potential for cost savings is significant.
– The plans eliminate the volatility of the stock market. Your purchase is guaranteed – no matter what might happen to the markets. Choosing to pre-purchase tuition in a Private College 529 savings plan is therefore a much less risky option than pinning hopes of a good education on a certain share price rising.
– There is an excellent choice of participating institutions. The list currently includes 270 private colleges including MIT, John Hopkins University, and the University of Miami, and the numbers continue to grow. The program is national, so it doesn’t matter if your family move halfway through the plan.
– Tuition certificates purchased now are valid for up to 30 years and no commitment is required as to which college the student will ultimately attend. That choice can be made later. Should the student for which the plan is intended ultimately opt to attend a non-member private college or a public college, the funds accrued are not lost. Options include changing the beneficiary, rolling the funds into an alternative 529 plan, or requesting a refund (with some negligible caveats).
Of course, a Private College 529 Plan may not be for every family, but taking time out to consider the future cost of your child’s education can only ever be a good thing. Find out more about the program today and get started with just $25. That figure sounds a lot better than $40,000 plus, wouldn’t you agree?