pittfan

First time posting on here, longtime lurker. We have a 529 plan, the tuition we are buying reflects Penn States rates. If our child goes to a private school and the tuition is say twice as much as PSU, do they apply the credits we bought and we simply pay the difference in the tuiition? thanks for any help

fineartsmajormom

Each state's plans are different so you should not rely on this forum for the answer. I had a similar question...called the plan and they explained clearly how it works. In VA case, if you have a prepaid tuition plan but decice to go private or out of state, you take the cash you paid in with a small interest rate return included. So, if the plan cost you $20,000 7 years ago, you can take $20,000 plus small amount of interest out of the plan. The younger the child when you bought the plan, the bigger the payoff to go in state. One really nice benefit, that I didn't realize, is that the 529 value reflects UVAs rates (flagship U) like PennState so if you go in state to a community college or an alternative state school the 529 pays out as if he were at UVA so the extra money after paying the lower fees and tuition can be used for other educational expenses including housing/books etc. It certainly makes the kid and family think about value for the buck...even if our S gets into UVA or even an Ivy I think he should seriously think about the value of that 529 at a less well-know state school.

patsmom

We have the Florida Prepaid Tuition Plan and my son goes to an out-of-state private university. Each semester, the plan pays his university the equivalent of the average cost of tuition at a Florida state U (calculated as a rate per credit hour). This figure increases yearly. It was $82.15 per credit two years ago and is $96.34 this year

Let's say for the sake of simplicity that the average cost is $100 per credit hour. If my son takes 15 credits, the Florida Prepaid Tuition Plan sends his university $1500. If he takes 18 credits next semester, they'd pay $1800. They'll keep paying up to a cap of 120 units (credits).

mom2collegekids

IF you go to your PA state pre-plan website, it should tell you how they figure what to give you for going to a private.

In our state, they use the "average" cost of tuition at our state's schools.