Critics say it needs to be revamped or shut down, but the popular Florida Prepaid College Plan is getting ready to open its doors again for another round of enrollment - at higher prices, of course.
The prepaid plan will sign up new students Oct. 18 through Jan. 31. Prices vary with the plan selected and the age of the student. A four-year university tuition plan for a newborn will cost $10,330 as a lump sum or $74 a month, up 8 percent from last year. Payment plans include interest charges of 5.3 percent a year.
Critics say prepaid plans keep a lid on tuition, which many educators and business leaders think should be rising at a faster rate. If tuition increases too rapidly, a prepaid program could run out of money to pay promised benefits.
Some states have closed their plans to new students. Florida law guarantees payment of tuition for plan participants who are in college or within five years of starting. If the plan is disbanded, the state's only obligation to younger enrollees is to give them their money back with interest. However, the Legislature could grandfather everyone enrolled.
Since inception in 1986, Florida's program has sold 973,690 plans, and this year the number should pass 1-million. Families can buy plans that cover university or community college tuition or both, local fees and dormitory rental. For information, go to www.florida529plans.com or call toll-free 1-800-552-4723.
