Note: There is a maximum of 200 words per comment. If you wish to post more, please visit our forum.
Don’t panic, state officials tell college plan investors
Monday, October 13, 2008 | No comments posted.
SALEM (AP) — Oregon officials are urging families who invested in Oregon’s college savings plans not to panic.
The plans lost about $100 million from January through September, but it is nearly impossible to gauge how much more they may have lost in October’s stock plunge, said Michael Parker, executive director of the Oregon 529 College Savings Network.
State Treasurer Randall Edwards says his jaw dropped last week when he read his own latest statement — he has two teenagers and a preteen.
“There’s going to be some pain in it, and I’m going to feel some of that pain, but I think overall people are going to be fine,” Edwards said. “I’m not changing a thing.”
He acknowledged, though, that that especially parents who have an older child in college or one who will soon graduate from high school are going to find things “a little rough.”
Oregon offers three college savings plans with tax incentives. Investors can deduct up to $4,000 on state taxes for married couples filing jointly.
The money in the plan grows and can be taken out tax free (federal and state) if it is used for qualified higher education expenses, such as tuition, fees, room, board, books and supplies.
There are about 70,000 investors setting aside money for more than 100,000 children in three plans under the Oregon 529 College Savings Network. The plans offer tax incentives under Section 529 of the federal tax code.
About 90 percent of families in the flagship plan, called the Oregon College Savings Plan, pick an age-based investment strategy that starts out aggressive and gets more conservative as the child gets older. The average age of children in the plan is about 71⁄2.
For parents of young children, the market’s plunge is an opportunity to buy more shares, said Lyn Hennion, a financial adviser in Medford and a member of the board that oversees Oregon’s college savings plans.
“By the time these 5-year-olds are 10, they are going to be looking pretty smart for accumulating shares at this down time,” she said.
Parents of college-age children might consider switching to a money market fund in their account or even taking it out now if they are worried and know they will need the money for college expenses in the next six months.
But, Hennion said, “I hate to see anybody sell at this time.”
The plans lost about $100 million from January through September, but it is nearly impossible to gauge how much more they may have lost in October’s stock plunge, said Michael Parker, executive director of the Oregon 529 College Savings Network.
State Treasurer Randall Edwards says his jaw dropped last week when he read his own latest statement — he has two teenagers and a preteen.
“There’s going to be some pain in it, and I’m going to feel some of that pain, but I think overall people are going to be fine,” Edwards said. “I’m not changing a thing.”
He acknowledged, though, that that especially parents who have an older child in college or one who will soon graduate from high school are going to find things “a little rough.”
Oregon offers three college savings plans with tax incentives. Investors can deduct up to $4,000 on state taxes for married couples filing jointly.
The money in the plan grows and can be taken out tax free (federal and state) if it is used for qualified higher education expenses, such as tuition, fees, room, board, books and supplies.
There are about 70,000 investors setting aside money for more than 100,000 children in three plans under the Oregon 529 College Savings Network. The plans offer tax incentives under Section 529 of the federal tax code.
About 90 percent of families in the flagship plan, called the Oregon College Savings Plan, pick an age-based investment strategy that starts out aggressive and gets more conservative as the child gets older. The average age of children in the plan is about 71⁄2.
For parents of young children, the market’s plunge is an opportunity to buy more shares, said Lyn Hennion, a financial adviser in Medford and a member of the board that oversees Oregon’s college savings plans.
“By the time these 5-year-olds are 10, they are going to be looking pretty smart for accumulating shares at this down time,” she said.
Parents of college-age children might consider switching to a money market fund in their account or even taking it out now if they are worried and know they will need the money for college expenses in the next six months.
But, Hennion said, “I hate to see anybody sell at this time.”
The comments below are from users of theworldlink.com and do not necessarily represent the views of The World or Lee Enterprises. Participation Guidelines
Note: There is a maximum of 200 words per comment. If you wish to post more, please visit our forum.
Note: There is a maximum of 200 words per comment. If you wish to post more, please visit our forum.
Not already registered?
The World welcomes your comments about stories, and we encourage a robust dialogue on this site. All comments must meet reasonable standards of decency and civility.
Please follow these basic rules:
- No defamatory comments about individuals or businesses.
- No deliberately false information.
- No obscenity or racially offensive language.
- No harassment, verbal abuse, threats or personal attacks.
- No information that invades another person's privacy.
- No business solicitations or charitable solicitations.
Comments that violate these standards will not be posted. Users with repeated violations may be banned from future posting.Comments will be approved throughout the day during business hours. After hours and weekend comments may not appear until the following business day. It may take a couple of hours before comments are approved.
The World generally does not edit comments, but we reserve the right to edit any comment that does not meet our standards.
Close Guidelines