Prepaid tuition or College Savings Plan?

[april004]

Did you get your 529 statements last week and get sick to your stomach over the losses during the first quarter like I did? :mad:

My children are young as well, almost 4 and 16 months and they have had 529's since birth also. Everything is cyclical, or so I keep telling myself, and I just hope we are in a good cycle when it comes time to take that money and actually use it for them.

You could try some other safer forms of investing the money in addition the 529, like Goldpaw suggested, but then you also run the risk of accessing the money yourself, again like Goldpaw pointed out.

Do you have an advisor who set the 529 up for you? Maybe you could ask him/her for some advice.

Good luck in your decision!

Yes, that's what drove me to the prepaid tuition site. I saw the statements and my heart dropped to the pit of my stomach.

Me and the hubby have decided to keep the 529 and continue contributing to it while at the same time buying prepaid tuition, but instead we are only purchasing 2 years at the community college. The plan is also portable. If he chooses to go to the university in state or out of state, he can still use the money, it just won't go as far.

A part of me feels like I'm selling my son short by just prepaying for the community college and not the university, but that's what we can comfortably afford now. Plus he'll still have his 529 that he can use to continue @ the university if he so chooses. I just don't know if it will be enough depending on where he ends up. Maybe though, that will be incentive enough for my son to work hard, knowing he doesn't have a complete free ride and he may have to come up with some money of his own for the last two years of his education if the 529 falls short. I'm also going to open up what others have suggested, long term CDs.

Call me a bad mother, but really, I'd rather he not have to worry about where his tuition money is coming from. I've been through that , I don't think it made me a better or stronger person. It did make me more of a worry wart though when it comes to finances.

Anyways, thanks for all the advice! I greatly appreciated everyone's input!