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Writer's pictureBeth & Tim Manners

In Tuition: College ‘Pre-Pay’ Gains Popularity

Updated: Sep 20, 2019

Times Union: “To broaden college access and affordability, lawmakers have in the past pushed for a ‘pre-paid’ plan that would let families lock in tuition for their kids by paying in advance … So far, 11 states have added pre-paid components to their 529 savings plans, according to the Rockefeller Institute study. Those include a plan in Massachusetts that lets savers lock in half of their future tuition: If tuition was, say, $10,000 today, a $5,000 Tuition Certificate would be guaranteed to cover 50 percent of tuition — no matter how much the tuition cost increases in the future.”


“Florida, which has the nation’s largest pre-paid, plan lets parents lock in tuition at a state school from a child’s birth. At the current rate, families that paid $186.28 per month from the child’s arrival would cover tuition and fees for 120 credits, enough to earn a bachelor’s degree.”


“A November report by the Brookings Institution found that parents accumulating six-figure loans for their children are making up a record share of borrowers for college loans … Not everyone is convinced that pre-paid programs are the answer. The New York Public Interest Research Group believes more financial aid is needed. It’s unclear what schools overall think of pre-payment plans … One potential challenge the schools might be contemplating: If costs go up faster than expected, schools might face a financial gap if a lot of families have locked in their tuition rates.”

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