Open enrollment has begun for the Florida Prepaid College Plans. Audry Liss, the Accounting Coordinator for the Student’s Account Office at the University of West Florida says bout 1,200 students are currently paying for college at UWF using a Florida Prepaid plan. And while 1,200 students may seem like a big number, it’s out of over 13,000 students, which means less than 10 percent of students at UWF are using the Florida Pre-Paid College Plan. Liss says using the plan at UWF is pretty easy. "It really is effortless for the student themselves because we tie into the system. Someone else has already paid for it. it's listed on their account. It automatically comes off their tuition balance. I don't know how easier it could get."
The Florida Prepaid College Plans are open to any child in any Florida family, even if that child is born during the open enrollment period. "From the moment your child is born from now until February 28 of 2017, you could go ahead and sign that child up for a plan" said Shannon Colavecchio, a spokesperson for the Florida Prepaid College Board. She says there are there are over a half dozen plans that range in coverage to four years of university tuition to a 2 plus 2 plan that covers two years of state college followed by two years of university. There is also an option to buy one year at a time. "Our newest plan is the 1 Year University Plan which debuted two years ago, and we're continuing to see a lot of interest in that plan, in part because the price is so affordable. That one starts at just $47 a month, even less than that for a new born, which is pretty affordable for some families. And that covers a full year of college."
Colavecchio says many families have had different members get together to buy individual years for a single student. "That's [one of the most] popular features of that plan. The idea [is] that a grandparents set or aunts and uncles and parents can all contribute toward the same child."
Just about every state in the U.S. has some form of college savings plan, the so-called 529 plans that let you save for college tax free. The prepaid plans are different in that the risk of making a bad investment decision is taken away. Florida is one of only six states that offer the prepaid option. "I think it's a testament to the vision of the state and the fact that we have really done a good job with the Florida Prepaid College Board anticipating what college tuition is going to look like [and] making smart [investment decisions.] And the fact that this is guaranteed by the state of Florida really give families peace of mind. Whatever you put into that prepaid plan, you can not lose it."
Florida Prepaid offers plans for university and state college tuition, housing expense’s and local fees. There are no meal plans or plans for books and other things students will need when they head off to college. "The 529 Plan can be used for those other college expenses. It's an investment plan so it could be a riskier set of investments or it could be a little more safe. That one is not guaranteed by the state of Florida. in other words, worst case scenario [there's a] market crash, you could lose some money." She says to ease some of that risk they offer age-based investments. those can be riskier in the beginning when you have an 18 year window to invest, and more conservative when your child gets closer to college age.
Parents can open one of the 529 savings plans anytime, year round. Open enrollment for the prepaid plans is on now until February 28.
