Battered college savings industry weathering the storm

Parents are still contributing to their children’s college funds, despite the ravages of the recession, according to research released today. Assets in Section 529 college savings plans were down only 3% in the first quarter of 2009 from the fourth quarter of last year, dropping from $88.5 billion to $85.9 billion, according to data developed by Boston-based Financial Research Corp. and released today by the College Savings Foundation in Washington. But assets suffered a severe drop from a year ago, falling 22% from $109.86 billion in the first quarter of 2008. “Despite challenging economic times, families are continuing to invest in 529s at roughly the same pace as they did in the last quarter,” CSF chairman Kevin McMullen said in a statement. The FRC numbers were underscored by a new survey released today by Country Financial of Bloomington, Ill., showing that 61% percent of parents said they are not letting the recession change their plans for their children’s college education. What’s more, 47% said college plans are a higher priority than retirement savings. The telephone survey of 1,241 Americans who expect to be responsible for paying for a child’s education was conducted by Rasmussen Reports LLC of Asbury Park, N.J., an independent research firm.