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Released: December 18, 2011
529 college savings plans have their downsides
Source: Walter Hamilton and Stuart Pfeifer, Los Angeles Times
Sherri and Cliff Nitschke thought they were planning wisely for their children’s college educations when they opened a 529 savings account in 1998.
The Fresno couple saved diligently over the years in hopes of avoiding costly student loans. But their timing couldn’t have been worse.
When they needed the money a decade later, their 529 account had plunged in value during the global financial crisis. Their portfolio sank 30% in 2008, forcing the Nitschkes to borrow heavily to send their two sons to UCLA.
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