As Washington state universities prepare to raise tuition by double digits again this year, many families are looking to the state’s prepaid college-tuition plan to blunt the impact.
But because tuition has gone up so dramatically in such a short period of time, the price of Guaranteed Education Tuition – or GET – units has risen sharply, as well.
Under the program, 100 units pay for the equivalent of a year’s tuition and state-mandated fees at the state’s most expensive institution. Financial experts say Washington families should weigh the high price of GET units carefully against other college-tuition investments, because the gap between the value of the units and the cost to purchase them has grown.
This year, the cost of a GET unit increased by more than at any time in the history of the 14-year-old program, jumping from $117 in 2010-2011 to $163 this year. Program officials say the price was raised to build up reserves because GET is underfunded – if everyone tried to cash in at the same time, it would be able to pay out only about 83 percent of benefits. The shortfall is due to its investments declining during the recession, similar to many pension funds’ values at the time.
At the same time, as state legislatures cut higher-education funding as a way to balance their budgets during the recession, publicly funded universities across the nation have been forced to raise tuition. Last year, for example, the University of Washington raised tuition by 20 percent, and next month the Board of Regents is expected to raise it for the 2012-2013 school year by another 16 percent, bringing the cost of in-state undergraduate tuition and fees to $12,385 a year.
The prepaid college-tuition plan typically sees most of its sales toward the end of May. The deadline to create a new account is May 31. (Seattle Times)
