Montgomery, AL – Alabama's college savings plan has seen a 24 percent decline in assets over the last year due to the stock market drop and mortgage investment problems.
The program manager, Van Kampen Investments, told the board of the Alabama Higher Education 529 Fund on Wednesday that Alabama's drop was slightly higher than the national average of 21 percent for similar state programs.
Alabama's program allows parents to invest money in stocks and bonds and then use the proceeds to pay children's college expenses. The program's assets dropped from $695 million at the end of 2007 to $528 million at the end of 2008.
The program's drop was not as severe as the state's prepaid college tuition plan. Because of that, the program's marketing firm, the Red Square Agency, recommended Wednesday that it dissociate from the prepaid college tuition plan.
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