The plan allows individuals to purchase tuition certificates to use at more than 220 private colleges and universities currently participating in the plan. With the certificates, current tuition rates would be locked in and would apply for future tuition payments, assuming the beneficiary gains academic admission to the participating educational program, according to a news release.
Further, participating institutions are required to discount off their current tuition rates by a minimum of 0.5%. So, in addition to locking in current rates, participants can save in the overall cost of the private school’s education. The discount and tuition rates are established every July 1, to be applied to purchases made within the new program year. Once set, these rates are fixed for tuition certificates purchased during a program year.
Accounts can be opened with a minimum deposit of $25 provided contributions total at least $500 within two years. The maximum lifetime contribution limit is equal to five years’ worth of tuition at the most expensive participating college in the plan discounted as if the beneficiary were a newborn.
Individuals can open accounts at no charge and locate member institutions through the plan’s program manager, TIAA-CREF Tuition Financing, Inc., by calling (888) 718-7878 or at www.independent529plan.org .