Quote:
Originally Posted by Inkstain82
With a 529, the money is still in your hands.
With pre-paid tuition, you are now an unsecured creditor. Even to a university, I'd feel uncomfortable with that.
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Inkstain82,
Many of the programs have a provision where the state backs the prepaid tuition plan if there is a shortfall. There have been some plans which were so far out of balance that they had to take corrective steps. What generally happens is the folks who have already signed up are grandfathered and they stop new enrollments for a period of time and re-wicker the program. The
new contract prices generally go up quite a bit when they come back on line.