Protecting College Savings
OKLAHOMA CITY -- While the state reaps the benefits of the stimulus money Oklahoma children are losing money.
College savings plans are taking a hit as the stock market takes a dive.
Oklahoma's 529 Savings Plan has taken a loss and it's not as much as other states. But still, parents are worried what to do with their money.
"When we established the 529 Plan I wanted to give my daughter more for when she is in college," mother of two Melinda Tice said.
Tice wants her two little girls to focus on their studies and not have to juggle school and work, like she did.
"I don't want them to have to worry about money whenever they do go into college," Tice said.
That's why she contributes to her daughters 529 Plan once a month. But her savings for the future is taking a hit.
"It took a loss, I don't know how big," Tice said.
The question now is what does she do with the money left in the account?
First, State Treasurer Scott Meacham says to not panic; there is good news.
"Nationally plans are down about 21 percent, we're only down 12 percent," Meacham said. "We've actually grown our number of accounts by 8 percent since the downturn started."
The Oklahoma 529 has six different investment options that you can change up to two times a year.
Right now parents and grandparents are going for the guaranteed option.
"The guaranteed return option is for those who don't want to take any risk they accept a lower overall rate of return, but they take no risk," Meacham said.
He says to keep saving, because the cost of college in not getting any cheaper. As for Tice, she plans to reevaluate her situation and, like everyone else, hopes the market makes a turnaround.
"It could be a lot worse, but I'm just thankful we do have money in there and it's not negative or anything," Tice said.
And keep this in mind, if you have a shorter time until you need the money go with the guaranteed return option but the longer you have until your child is in college, you will have a better return if you stick with a riskier option.