Changes on the table for prepaid tuition program
Article from Bloomington Pantagraph:
2014-02-25T16:40:00Z Changes on the table for prepaid tuition program pantagraph.com
SPRINGFIELD — A state lawmaker wants to restructure the state’s prepaid college tuition program before it runs out of money.
Legislators have expressed concern about the College Illinois program, which allows families to prepay for a college education at today’s rates. The program faces an unfunded liability of $ 448.5 million.
State Sen. Jason Barickman, R-Bloomington, said the program will run into trouble down the road if lawmakers don’t intervene.
“College Illinois’ most recent actuarial report revealed that unless the program is reformed, the program will have to sell between 1,000 and 2,000 contracts annually in order to make itself solvent,” he said. “Anytime you have a program that is dependent on attracting new investors in order to meet the obligations of current investors, I think it gives you pause.”
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The Role of the Prepaid Tuition Plan -
Article from and Some Helpful Things to Know in 2014 – Motley Fool:
In addition to the wide range of 529 college savings plans based on tax exempt status, there’s an option commonly called “prepaid tuition,” which often receives a “529″ designation and presents an alternative for college savings. Prepaid tuition 529 plans work differently from tax free 529 plans and come with different kinds of risks and rewards.
How prepaid tuition plans work
Families looking at higher education investment choices can look to prepaid tuition plans as opportunities to pay into an account for their child’s college fund at rates that reflect the rising cost of college tuition. The idea is that by going prepaid, parents save a lot of money as higher education costs continue to rise. But, as many financial experts point out, that’s not the whole…………………continues on and Some Helpful Things to Know in 2014 – Motley Fool
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