Florida Prepaid – College Savings Simplified!
College savings can feel like a daunting task. But it can be simple, and it can start with Florida Prepaid. First, it might help to understand what Florida Prepaid is by first understanding why it exists! The program began almost 30 years ago, when state leaders wanted to help make college more accessible for families.
Their solution? Give families the opportunity to purchase tomorrow’s tuition at today’s plan prices — in essence, allow families to pay in advance for college, with a payment schedule that makes it more affordable.
The Florida Prepaid College Program is now the largest, most successful and longest-running prepaid program in the nation, having made higher education a reality for more than one million Florida families. Moreover, the program has grown and changed over the years to offer more flexibility. Now, families can save in two ways: through a Florida Prepaid College Plan and through a Florida 529 Savings Plan.
Let’s start with the Florida Prepaid College Plans. With a Prepaid Plan, families can prepay the future cost of college at today’s plan prices. When it comes time for college, Florida Prepaid pays the actual price of costs covered by the plan for tuition and specified fees at Florida’s 12 public universities and 28 state colleges. There are five tuition Plan options, and each is guaranteed by the state. Families will never lose the money they put in.
Prepaid Plans are also flexible: If your child chooses to attend school out of state or at a private college, your Prepaid Plan will pay out the same amount it would have at a Florida public institution. If your child receives a scholarship, such as Bright Futures, the remaining Prepaid Plan balance can be refunded or be transferred to another beneficiary.
The price of a Prepaid Plan depends on a number of factors, including the age of your child and type of plan you choose. For example, you can get a Plan that covers just one year at a university or you can get a Plan that covers all four years at a college or university. You can even add in a University Dormitory Plan.
According to Sallie Mae’s 2017 “How American Pays for College” report, 86 percent of families always knew their child would go to college, but only 39 percent of families made a plan to pay for it.
Prepaid Plans are available for children ages newborn to 11th grade whose parent or guardian has been a Florida resident for the past 12 months. You can submit your application at any time, and our Open Enrollment period is from October 15, 2017 and February 28, 2018. You’ll have three payment options: monthly until your child is expected to enter college, a five-year payment plan, or a lump sum. Monthly payments are the most popular option.
Now, let’s talk about the Florida 529 Savings Plan, which allows families to save for college at their own pace using our investment options. When it comes time for college, use your savings to pay for actual college costs. There is no minimum monthly contribution and you can start at any time; Plans are available to anyone nationwide and open to any age – even adults!
The Florida 529 Savings Plan offers 11 investment plans; pick one, or choose any combination to meet your savings goals. Our most popular option is the age-based portfolio. Earnings on the investments are tax-free when used for qualified higher education expenses such as tuition, fees, room and board, books and even graduate or professional school.
Many families that purchase a Prepaid Plan opt to also invest in a Savings Plan to save for costs that aren’t covered by a Prepaid Plan, such as books. Both plans are smart choices and you can choose one or both!
If you have more questions about Prepaid Plans and Savings Plans, there’s a handy chart here (http://flprepaidstage.wpengine.com/learning-center/savings-vs-prepaid-plans/). Just remember: The sooner you start saving, the greater the chance of having your child graduate free from student loan debt. The best way to get started is to visit www.myfloridaprepaid.com today!