Independent 529 Tuition Plan Lauded By BusinessWeek
Baylor University is among a consortium of colleges receiving accolades in the Dec. 15 issue of BusinessWeek for launching Independent 529 Plan, a new prepaid college tuition plan named by the national publication as one of the "Best Products of 2003."
Independent 529 Plan is a tax-advantaged plan for families to save for tuition at more than 200 participating private colleges, including Baylor. Independent 529 Plan is the brainchild of a nationwide organization of colleges and universities, which designed the financial product and worked to win approval from both Congress and the IRS to get it up and running.
"It has the advantages of state 529 plans," said Douglas M. Brown, CEO of Independent 529 Plan, "and in addition can essentially roll back the clock on the cost of future tuition."
The group has hired TIAA-CREF's Tuition Financing Inc., to administer the plan. Baylor helped launch the innovative product last September.
"We see this as another valuable option for families of prospective students to keep Baylor affordable and accessible," said Bob C. Spence, associate vice president for financial services and treasurer. "Regardless of whether a student attends Baylor or another one of the member institutions, Independent 529 Plan represents a way for parents to contribute and pay for private college without worrying about either investment risk or tuition inflation."
Each December BusinessWeek editors cite what they think are the year's best products. In selecting this year's winners, editors wrote that they focused on "innovation, big and small."
"It is not often that higher education gets cited by a respected national publication like BusinessWeek for introducing innovative products, so this truly is a unique honor," said Baylor President Robert B. Sloan Jr. "I am pleased that Baylor was able to partner with some of our sister private institutions to create a means by which families can effectively plan and manage the investments they will make for their children's education."
In addition to Baylor, other major universities participating in Independent 529 Plan are Rice, Southern Methodist and Texas Christian in Texas, Pepperdine, Stanford, Emory, Notre Dame, Princeton, Wake Forest and Vanderbilt, among others.
Section 529 Plans, named for the IRS code that defines them, have gained in popularity over the last decade. Families have been attracted to these plans because accounts generate no federal income tax if used as intended, benefits are transferable to other members of the family, and refunds are available if the child receives a scholarship or decides not to attend college.
For purchasers, the effectiveness of Independent 529 Plan is not dependent on the performance of the stock or bond markets. Rather, contributions are actually pre-purchasing tuition, in part or in whole, at less than today's prices.
For more information, visit Independent 529 Plan or call their toll-free number (888) 718-7878.