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529 E-ditorials

00-16: Thanks to Drew
Joe Hurley
Thursday, August 10th 2000

A lot of people are surprised when I tell them I don’t know “Drew” personally. I’ve never met him and I’ve never spoken to him. The only way I know Drew, and probably the way you know him too, is through his contributions to our Message Board here at SavingForCollege.com. He has been a regular on the Board almost from its inception more than a year and a half ago, and has responded to many dozens of questions posed by others.

Drew’s postings often times seem hastily written. They are full of misspellings and quirky sentences. A lot of times I have a hard time understanding what he’s saying. He can be enlightening, entertaining, and bullying at the same time. I’ve even been asked to “tone him down” (which I will never do to anyone unless content becomes profane or irrelevant). Drew’s answers are helpful and insightful, but can also be less than thorough and perhaps even less than fully accurate. The same can probably be said about my own responses, or those of anyone else. Caveat emptor.

I appreciate Drew. I also appreciate everyone else who contributes to the SavingForCollege Message Board, visitors who pose questions and opinions and in particular those who respond. I love to see familiar names come back. Some are “amateur” investors with an interest in 529 plans and the challenge of saving for college, while others are certified financial planners, attorneys, and other professionals. We even get a “state official” writing in once in a while.

Why is the Message Board so vital? It’s because we are dealing with a topic – section 529 college tuition plans – that generates a lot of great questions, and many times there are no real solid answers. I would bet we have had questions that no one has thought of before. Not the states, not the program managers, not the IRS. And we’ve had a few strongly worded opinions as well. I welcome them, even when I don’t agree with them.

Message board regulars can come and go. I realize that. I also realize that it is the regulars who have a large part in the success of an online message board, whether it’s SavingForCollege.com or any other web site. Thanks for being part of our growing community.

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Just got back from the annual conference of the College Savings Plan Network (an affiliate of the National Association of State Treasurers) in Chicago, where I was asked to participate on a panel of “financial writers”. The excitement and enthusiasm surrounding 529 plans exhibited at the conference is fantastic. New programs coming along, enhancements to existing programs, differences with IRS and the Department of Education being ironed out, scholarship tie-ins, public-private partnerships … it all points to a growth explosion in the 529 “industry”.

One break-out group predicted a ten-fold expansion in the amount of invested assets in 529 plans to $75 billion over the next ten years. For several reasons (which I will explain in a future 529 E-ditorial) I believe that estimate is probably much too low. On the other hand, if Congress decides to make a national tuition plan the best deal going, the states face a significant threat! The family with kids won’t care too much about the states; they just want the program with the best benefits.

A lot of people at the conference seemed to think that the savings-type 529 plan will predominate in the future (savings plans represent less than one-quarter of the approximately $7.8 billion now invested in 529 plans). While I certainly would not disagree with this conclusion, I also believe the prepaid tuition concept should, and will, be a big part of the future (see 529 E-ditorial 00-4).

As I’ve said before, hang on to your seats. We are in for an interesting ride.

» 05-4: The 529 marshals have arrived - 08/30/05
» Our 5.29th-year anniversary - 06/29/05
» 05-2: 529s and the new Bankruptcy Act - 04/28/05
» 05-1: Reform or Deform? - 02/27/05
» 04-6: Perspectives on the 529 debate - 12/28/04
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