7 Myths Debunked About Florida Prepaid
You’ve heard the expression that a rose by any other name would smell as sweet? We titled this blog “7 Myths Debunked,” but we could easily have gone with “7 Reasons to Sleep Easy” or “7 Reassuring Facts About Florida Prepaid.” Read on to discover why Florida Prepaid is a safe, flexible vehicle for your college savings.
Myth #1: I have to go to college right after I graduate to use my Prepaid Plan.
Facts: Take a gap year, if you want. Or take two! Generally speaking, a student who graduates high school on time has 10 years to use all of their Prepaid Plan benefits. Any unused benefits can be applied toward graduate-level courses within the same 10-year period. You may also transfer the benefits to another qualified family member, or you can even request a refund of unused funds.
Myth #2: If I get a scholarship, I won’t need a Prepaid Plan, or I won’t benefit from the full value out of my Plan.
Facts: Florida students mix scholarships, including Bright Futures, with Prepaid Plans all the time — and with great results. The two work in tandem, with the Prepaid Plan typically applied to your account first.
It won’t surprise you to hear that college is expensive. Tuition and fees are roughly half of the cost of college, while room and board, and books and supplies account for the other half. Having Prepaid funds in addition to scholarships creates a comfort zone and diminishes the chance a student will need to take out loans.
A final point: If your child receives a scholarship, you can get a refund for the same amount as the plan would pay a public college or university in Florida.
Myth #3: If I move away from Florida, I will lose my Plan.
Facts: Florida residency is required to purchase a Prepaid Plan, but it isn’t required to keep one. If you or your child move out of state, your Plan will continue as if you never left. In fact, some savvy parents purchase a Prepaid Plan before they move to preserve in-state eligibility for their student.
Myth #4: I’ll lose all of my Prepaid Plan savings if I don’t go to college.
Facts: You can transfer your plan to another eligible family member or cancel your plan for a full refund of what you’ve paid in.
Florida Prepaid Plans are guaranteed by the State of Florida, so you cannot lose your investment.
Myth #5: Prepaid Plans can be used only for public schools.
Facts: While Prepaid Plans are designed to be used at a Florida College or State University, the plans can also be applied at other schools nationwide. Public, private, in-state or out-of-state, we would pay what we’d pay a Florida school.
Myth #6: If I buy a Prepaid Plan for a Florida College and my student decides to go to a State University, I lose my investment (or vice versa).
Facts: Not a chance! You can choose the plan that’s right for your family’s budget and savings goals knowing that a college plan can be used at a university and a university plan can be used at a college. We just pro-rate the value in each situation. As an example, if you have a 2 + 2 Florida Plan and you decide to go to a State University, your plan will end up covering around three years of costs, since two years at a Florida College is about the same value as one year at a State University.
Myth #7: If you open a Prepaid Plan, you can’t have another 529 plan.
Facts: We actually encourage parents to save in both vehicles if they can. A Savings Plan typically covers additional expenses that a Prepaid Plan doesn’t, such as housing and meal plans, books and supplies, as well as computers.
The Florida Prepaid College Program has been around for more than 30 years, with well over 1 million Plan holders. We want to make your decision to start saving with a Prepaid Plan simple and easy. If you have any more questions, feel free to visit our FAQs or call us at 1-800-552-GRAD (4723).