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College Illinois vs 529?

By Terry Savage on April 20, 2017 |

Hi Terry. My husband and I purchased 8 semesters of college for our first daughter through the College Illinois program, roughly 14 years ago. Since then, we could afford to purchase only 2 semesters of College Illinois for our second daughter. We just sold a piece of property and plan to apply the proceeds to the rest of her college. However, we're not sure if we should stick with College Illinois or place it in a more generic 529 Plan. I would love to get your thoughts on this. Thank you so much! BTW, I saw you speak at Uline several years ago and then at an Economic Forum in Chicago in early 2015, and really enjoyed it. Thank you

Terry Says

Please check for the previous responses to this question under the "College Savings" section of my Q&A blog.  In short, I definitely do NOT recommend any more investments in the CollegeIllinois prepaid tuition plan, given the precarious finances of our state.  Use a different kind of 529 plan -- the one that lets you choose investments to make the money grow.  It does have some risk, but at least it's not all-or-nothing risk!   And if you can afford to bypass the Illinois tax deduction for your contribution, I would suggest using an out-of-state plan, managed by Fidelity or Vanguard.  Remember, you can use the money in the plan for any college in any state, and you can invest in any state's plan.  Do comparisons at http://www.savingforcollege.com/ By the way, I am scheduled to speak at Uline again this August, so please come up and say hello. PS  If anyone reading this would like to have me present a program for your corporate employees, please send me an email at Terry@TErrySavage.com.

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