Illinois began its prepaid tuition enrollment period last Wednesday, not following the trend of five states who have suspended these programs because of increased tuition and a slow economy.

Ohio, Kentucky, West Virginia, Texas and Colorado have recently suspended their prepaid tuition programs for a 12-month period to avoid any future liabilities to their programs.

Prepaid tuition funds allow parents to begin investing a certain amount of money for their child's college costs — either in a lump sum or monthly payments — when the child is still young. A state then pools the money — which becomes a trust fund — in long-term investments, hoping that earnings will match or exceed the cost of tuition when the child is ready to attend college.

College Illinois! is the prepaid tuition program for the state. By law, the tuition trust fund created in this prepaid program cannot be combined with other state dollars, and the benefits received from the program are 100 percent exempt from state and federal taxes.

Ohio's prepaid tuition fund, The Guaranteed Savings Fund, allows families to purchase tuition units, which are held until a child reaches age 18, said Judy Cunningham, public relations manager of The Ohio Tuition Trust Authority. The suspension occurred on Oct. 8 due to the market value deficit, annual tuition increases exceeding investment returns, inflation of price units and fear of increasing the deficit of the fund, Cunningham said.

Although Ohio is suspending its fund, the money families have already invested in the fund is safe and families will receive their money when the child reaches 18.

A cash shortfall is expected in 2014, but the state plans to make up the difference, Cunningham said.

"The (families) will get what they have been promised in this program," Cunningham said.

Although the prepaid program is inactive in Ohio, there are many other savings options available for families, she added.

Jo Carole Ellis, executive director of the Kentucky Affordable Prepaid Tuition Program, said Kentucky's program was suspended due to the state legislature's concern about problems occurring in other state programs. This month Kentucky had their actuarial valuation, which reassured them that the program is financially stable, Ellis said. To maintain financial stability, Kentucky has an unclaimed property fund if investment earnings fail to keep up with tuition increases. This fund receives money from unclaimed property, including unclaimed safe deposit boxes, inactive bank accounts and uncashed checks, she said. After June 30, 2004, Kentucky's program should be active again, Ellis said.

Randy Erford, director of College Illinois!, said the program in Illinois is financially stable and there is no need to suspend it. This program, administered by the Illinois Student Assistance Commission, allows a student to receive 100 percent coverage in tuition and mandatory fees.

Erford said it is important to look longterm when planning prepaid tuition. He said by viewing historical data concerning tuition, College Illinois! expected fees to increase more than they have.

"The situation here is not a surprise to us," he said. "Our finances have improved in the last year."

Erford said tuition impacts these types of programs by raising their costs. But these increases in tuition cause more parents and grandparents to invest because of concern of escalating future tuition costs, he said.