November 24, 2011

HIGHER EDUCATION BUBBLE UPDATE: College Savings Drop Off as More Parents Feel Pinched. “New figures for the nation’s 529 plans are in from Boston-based Financial Research Corp., and there was a $354 million outflow in the third quarter. The last time parents pulled cash out of college-savings plans, rather than putting in: The fall of 2008, when the financial crisis was at its height.”

Plus this: “That tectonic shift, away from parents trying to foot all of the college bills, is not necessarily a bad thing, according to Stuart Ritter, a certified financial planner with T. Rowe Price in Baltimore. After all, college savings should not be the foremost priority of cash-strapped parents; retirement, emergency funds and insurance should all take precedence. He makes the analogy of airplane travel with kids: ‘You need to put on your own oxygen mask first.'”

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