About 40,000 Families that purchased prepaid college and university savings plans with the state of Florida could see the costs of those plans drop.
Florida prepaid customers will see lower rates this year and some could even get rebates or see their tuition savings plans paid off early. Under the revamped fee schedule, the cost of a four-year university plan could fall from $350 a month to $173 a month. The reductions come after the Florida legislature stopped letting public universities request tuition hikes. Kevin Thompson Director of the Florida Prepaid Board, says those yearly tuition increases affected future prices.
“When you take those costs and forecast them out into the future, not only are they going up now, but they go up even more when you compound them over time. So that was causing the cost of our prepaid plans to go up significantly.”
Under the changes, 18,000 families will get refunds, and another 8,300 families will see their plans paid off early. Others will see their monthly payments decrease.
The Prepaid program is also adding another feature this year. Customers can now pay for school one year at a time, instead of having to purchase all four years at once.
“So you can buy this year when you can afford it. You can buy another year a few years from now. You can have family members join in, let them buy a year, and you buy a year," says Thompson. " And the plans for those products will start out at $43 a month.”