The Different Types of 529 Plans
A Variety Of Ways To Pay For College
Planning for the future isn't always easy, but it should be. With lots of programs competing for your dollar, it's important to understand the pros and cons of all the ways you can plan to pay for college.
In general, 529 Plans help families fund future college costs, with tax benefits granted by Section 529 of the IRS Code. There are two types of 529 plans in Illinois—a prepaid tuition plan, as provided by College Illinois!, and college savings plans.
College Illinois! 529 Prepaid Tuition Plan
With a College Illinois! Prepaid Tuition Plan, you purchase semesters of college tuition, allowing you to lock in the cost of college. With a prepaid plan, no matter how high tuition rates climb by the time your child is ready to attend a school in the plan you purchased, tuition and mandatory fees will be covered.
529 College Savings Plans
Other college savings plans involve investing your money in a variety of ways including stocks, bonds, etc. Funds available to pay for the future cost of college will depend on how much you have saved and how well your investments have performed by the time your child is ready to enroll.