Myth/Misconception #1

As savings and investment opportunities go, prepaid tuition plans can’t compete with money invested in the stock market.

The truth is…, prepaid tuition isn’t designed to compete with money you’ve invested in the stock market to help fund your child’s college education; prepaid tuition is designed to complement savings and investments. One of the unique strengths of College Illinois! is this… It is the only way you can lock in the price of such a major portion of your total college costs before you and your child even begin to think about selecting a college and applying for financial aid. It is also the only way you can lock in that price with the backing of the State of Illinois.

Myth/Misconception #2

Prepaid tuition plans are great when tuition and fees are soaring; but prepaid plans make little sense during periods of low inflation.

The truth is…, despite low wage and price inflation in the United States today, tuition and fee increases continue to outpace almost every other household budget item, including health care. Since 1980, tuition has increased on average nationwide nearly 300%, while household income has increased only slightly more than 100%. In Illinois during approximately the same period, tuition and fees increased on average about 7% per year at Illinois public universities and at Illinois private institutions. Prepaid tuition is the surest way to protect yourself against tuition and fee inflation, even in a period of low wage and price inflation.

Myth/Misconception #3

Prepaid tuition plans are great if your children enroll in in-state public universities or community colleges; but not if they go out-of-state or to private institutions.

The truth is…, prepaid tuition can strengthen your college funding plans regardless of where your children enroll. Why? Because a student who enrolls at a private or out-of-state institution will receive benefits equivalent in value to what they would have received at an Illinois public institution. The difference is that the dollar amount will be applied toward their tuition and fee charges and, therefore, in most cases will not cover tuition and fee entirely. But all the "pluses" of prepaying tuition are still there--protection again inflation, stock market volatility and loss of purchasing power due to unforeseen circumstances.

Myth/Misconception #4

Prepaid tuition really hurts your chances for financial aid.

The truth is…, almost any asset owned by a parent or student could be said to "hurt" chances for financial aid, because an accounting of assets is one of the first steps in determining "financial need." As assets go, however, prepaid tuition offers unique benefits to those who will apply for financial aid. College Illinois! plans will not count at all against a student’s eligibility for State financial aid awarded by Illinois agencies, including the Illinois Student Assistance Commission. Nor will College Illinois! plans be counted as assets on the Free Application for Federal Student Aid (FAFSA).

Myth/Misconception #5

Prepaid plans are great only if you have a lot of cash for a lump-sum purchase.

The truth is…, you don’t need a lot of cash to lock in the benefits of a College Illinois! plan, because College Illinois! has a benefit and payment plan to suit almost any budget. College Illinois! Community College Plans start at only $18 per month, and Public University Plans start at only $44 per month. Payment options include both five- and ten-year monthly installments, and down payment schedules that can help lower the size of monthly payments.