Anonymous
Post 04/22/2013 21:28     Subject: I'm glad I bought in the VA prepaid
College tuition at good schools will continue to rise. Anyone who thinks otherwise is ignoring history.
Anonymous
Post 04/22/2013 20:39     Subject: I'm glad I bought in the VA prepaid
Anonymous wrote:
Anonymous wrote:
Anonymous wrote:
Anonymous wrote:College of William & Mary is raising their tuition 14% this year

http://www.washingtonpost.com/local/education/william-and-mary-raises-in-state-tuition-for-new-students/2013/04/19/ef3132d6-a8fd-11e2-a8e2-5b98cb59187f_story.html

I know Prepaids don't have as high a rate of return, but they way tuition keeps getting jacked up, I'm glad I've locked in my rate. (Before someone flames, I know my kids may not get into W&M, but it seems to be a trend across state institutions.)


Good for you but I think the trend of dramatic tuition increases is over.


I don't think that's as true for state schools. Some, like W&M and UVA, get very little funding from the state. They are capped on the number of OOS students they can take, who are already paying close to private college rates. So increases are more likely to hit in state students. And schools who are even more dependent on state funding for their budget are probably more vulnerable to state budgets cuts, and the difference will have to be made up in tuition.

I think private colleges will have to moderate tuition increases or substantially change the model (maybe moving to a 3 year undergrad program, which is certainly being talked about in some places) to make the ROI calculation worthwhile. It's hard to improve efficiency in the current education model without doing something significantly different. All of that will be too late for my kids who are already in college or on deck.



I don't think you read the article all the way through. What William & Mary did was an anomaly -- it fundamentally changed its tuition model. That wasn't a COL increase. Miami University in Ohio did something similar a few years ago.

UVa's increase was like 4%. The days of annualized 8, 9, 10% at state schools are done. So then the question becomes can you get a better return by investing yourself. For a long time, the answer to that was undoubtedly no. Now, I'm not so sure.

4% is still double the inflation rate though. I just don't see why they have to increase it more than that. It's not like the state can cut much more from what it gives them.
Anonymous
Post 04/22/2013 16:03     Subject: I'm glad I bought in the VA prepaid
The thing about the prepaid plan that is a perfect hedge. What I mean by that is that you are saving money for your kids to go to college. You do not know how much the tuition will increase or how much return you will get on your money. The prepaid plan solves for both and you are done!
Anonymous
Post 04/22/2013 15:29     Subject: I'm glad I bought in the VA prepaid
Anonymous wrote:
Anonymous wrote:
Anonymous wrote:College of William & Mary is raising their tuition 14% this year

http://www.washingtonpost.com/local/education/william-and-mary-raises-in-state-tuition-for-new-students/2013/04/19/ef3132d6-a8fd-11e2-a8e2-5b98cb59187f_story.html

I know Prepaids don't have as high a rate of return, but they way tuition keeps getting jacked up, I'm glad I've locked in my rate. (Before someone flames, I know my kids may not get into W&M, but it seems to be a trend across state institutions.)


Good for you but I think the trend of dramatic tuition increases is over.


I don't think that's as true for state schools. Some, like W&M and UVA, get very little funding from the state. They are capped on the number of OOS students they can take, who are already paying close to private college rates. So increases are more likely to hit in state students. And schools who are even more dependent on state funding for their budget are probably more vulnerable to state budgets cuts, and the difference will have to be made up in tuition.

I think private colleges will have to moderate tuition increases or substantially change the model (maybe moving to a 3 year undergrad program, which is certainly being talked about in some places) to make the ROI calculation worthwhile. It's hard to improve efficiency in the current education model without doing something significantly different. All of that will be too late for my kids who are already in college or on deck.



I don't think you read the article all the way through. What William & Mary did was an anomaly -- it fundamentally changed its tuition model. That wasn't a COL increase. Miami University in Ohio did something similar a few years ago.

UVa's increase was like 4%. The days of annualized 8, 9, 10% at state schools are done. So then the question becomes can you get a better return by investing yourself. For a long time, the answer to that was undoubtedly no. Now, I'm not so sure.
Anonymous
Post 04/22/2013 15:26     Subject: I'm glad I bought in the VA prepaid
I just talked to the VA Prepaid people and they tell me that for my child's private Virginia college tuition next year they will pay around $9,400 a year. I think the program is fantastic when you consider I paid about $14,000 for it 18 years ago. Of course if he was going to William and Mary it would be paying around $15,000 a year-- but overall $9.4K a year is not bad!
Anonymous
Post 04/22/2013 15:04     Subject: I'm glad I bought in the VA prepaid
Anonymous wrote:What if you move out of state by the time your kid is ready to start college? As in, VA resident today (and past 11 years) but maybe a relo is in my near future. Fast forward 7 years and we live out of state. Would my kids' plans still be relevant for in-state?


Sadly no. Once you move out of state, you lose the fantastic in state tuition benefit. The prepaid in VA will apply what's in your account to the OOS tuition.
Anonymous
Post 04/22/2013 14:32     Subject: I'm glad I bought in the VA prepaid
What if you move out of state by the time your kid is ready to start college? As in, VA resident today (and past 11 years) but maybe a relo is in my near future. Fast forward 7 years and we live out of state. Would my kids' plans still be relevant for in-state?
Anonymous
Post 04/20/2013 15:59     Subject: I'm glad I bought in the VA prepaid
In MD I think you can get the cost of College Park tuition to use anywhere in the country if you go with prepaid.
Anonymous
Post 04/20/2013 15:50     Subject: I'm glad I bought in the VA prepaid
Anonymous wrote:I'm thinking this look more and more like a good idea. Obviously the earlier you lock in the better the deal, but you are taking away some of your child's school choice.

How did you guys know it was the right fit for you?


They always say a certaoin portion of ones investment needs to be in bonds. If your child does not go to an instate school, you get the money back plus essentially passbook interest rates (which were dent at first but now are zero). So we considered it the bond portion of our college savings portfolio.

We also have put in ~$50k into their 529s to cover R&B and books. So both are coverd for instate costs.

We save in non educational accounts case they go out of state. If they don't use them, we have extra for our retirement or travel budget.
Anonymous
Post 04/20/2013 13:30     Subject: I'm glad I bought in the VA prepaid
Anonymous wrote:I'm thinking this look more and more like a good idea. Obviously the earlier you lock in the better the deal, but you are taking away some of your child's school choice.

How did you guys know it was the right fit for you?


Two things:

1. Realistically, based our our income, state school was always going to be the most likely choice. I don't feel like I'm doing wrong by my child. There are some annoying aspects of living in VA, but it has many strong public college options.

2. It doesn't actually lock in my child. The way the VPEP plan works, you can always just take the money and use it at a private or another state's school. You won't get the guaranteed tuition rate, but you'll have money saved up to pay for college, just like any other 529 plan. So, if my kid gets enough scholarship/aid from a non VA state school to make it work, they can still go there.

That was our how we settled on VPEP.
Anonymous
Post 04/20/2013 13:02     Subject: I'm glad I bought in the VA prepaid
I'm thinking this look more and more like a good idea. Obviously the earlier you lock in the better the deal, but you are taking away some of your child's school choice.

How did you guys know it was the right fit for you?
Anonymous
Post 04/20/2013 11:21     Subject: I'm glad I bought in the VA prepaid
Anonymous wrote:College of William & Mary is raising their tuition 14% this year

http://www.washingtonpost.com/local/education/william-and-mary-raises-in-state-tuition-for-new-students/2013/04/19/ef3132d6-a8fd-11e2-a8e2-5b98cb59187f_story.html

I know Prepaids don't have as high a rate of return, but they way tuition keeps getting jacked up, I'm glad I've locked in my rate. (Before someone flames, I know my kids may not get into W&M, but it seems to be a trend across state institutions.)


Same here. We bought when our now spohomore was born. Best $11k we have invested.
Anonymous
Post 04/20/2013 10:38     Subject: I'm glad I bought in the VA prepaid
Anonymous wrote:
Anonymous wrote:College of William & Mary is raising their tuition 14% this year

http://www.washingtonpost.com/local/education/william-and-mary-raises-in-state-tuition-for-new-students/2013/04/19/ef3132d6-a8fd-11e2-a8e2-5b98cb59187f_story.html

I know Prepaids don't have as high a rate of return, but they way tuition keeps getting jacked up, I'm glad I've locked in my rate. (Before someone flames, I know my kids may not get into W&M, but it seems to be a trend across state institutions.)


Good for you but I think the trend of dramatic tuition increases is over.


I don't think that's as true for state schools. Some, like W&M and UVA, get very little funding from the state. They are capped on the number of OOS students they can take, who are already paying close to private college rates. So increases are more likely to hit in state students. And schools who are even more dependent on state funding for their budget are probably more vulnerable to state budgets cuts, and the difference will have to be made up in tuition.

I think private colleges will have to moderate tuition increases or substantially change the model (maybe moving to a 3 year undergrad program, which is certainly being talked about in some places) to make the ROI calculation worthwhile. It's hard to improve efficiency in the current education model without doing something significantly different. All of that will be too late for my kids who are already in college or on deck.
Anonymous
Post 04/20/2013 10:19     Subject: I'm glad I bought in the VA prepaid
Anonymous wrote:College of William & Mary is raising their tuition 14% this year

http://www.washingtonpost.com/local/education/william-and-mary-raises-in-state-tuition-for-new-students/2013/04/19/ef3132d6-a8fd-11e2-a8e2-5b98cb59187f_story.html

I know Prepaids don't have as high a rate of return, but they way tuition keeps getting jacked up, I'm glad I've locked in my rate. (Before someone flames, I know my kids may not get into W&M, but it seems to be a trend across state institutions.)


Good for you but I think the trend of dramatic tuition increases is over.
Anonymous
Post 04/20/2013 10:17     Subject: I'm glad I bought in the VA prepaid
College of William & Mary is raising their tuition 14% this year

http://www.washingtonpost.com/local/education/william-and-mary-raises-in-state-tuition-for-new-students/2013/04/19/ef3132d6-a8fd-11e2-a8e2-5b98cb59187f_story.html

I know Prepaids don't have as high a rate of return, but they way tuition keeps getting jacked up, I'm glad I've locked in my rate. (Before someone flames, I know my kids may not get into W&M, but it seems to be a trend across state institutions.)