Texas Insider Report: AUSTIN, Texas – Texas Comptroller Glenn Hegar reminds families that open enrollment in the Texas Tuition Promise Fund®, the state's prepaid college tuition program, began Sept. 1 and runs through Feb. 28, 2021. The Texas Tuition Promise Fund offers parents and loved ones the chance to prepay a child's future higher education at Texas public colleges and universities at today's prices, excluding medical and dental institutions.
“With everything that’s going on right now, thinking about how to pay for college may not be at the top of many parents’ minds,” Hegar said. “Yet one day it will be time to enroll your loved one in a college or university, and a Texas Tuition Promise Fund account is an additional tool to help save for your children’s future education.”
Participants in the plan purchase prepaid "tuition units" that can be used later toward undergraduate resident tuition and schoolwide required fees at most Texas public colleges and universities, excluding medical and dental institutions. Prices are based on 2020-21 academic year costs for the state's public colleges and universities.
- Type I units, priced for undergraduate resident tuition and schoolwide required fees at the most expensive eligible Texas public four-year university or college, cost $151.64 per unit.
- Type II units, based on the weighted average cost of undergraduate resident tuition and schoolwide required fees across eligible Texas public four-year universities and colleges, cost $108.35 per unit.
- Type III units, based on the weighted average cost of in-district tuition and schoolwide required fees across eligible Texas public two-year community colleges, cost $28.81 per unit.
Under the plan, 100 units equal roughly one academic year consisting of 30 semester hours of undergraduate resident tuition and schoolwide required fees at the eligible Texas public school that most closely matches the unit's pricing base. Participants can purchase up to 600 Type I units — approximately six academic years — or the dollar equivalent of Type II or III units.
The plan's flexible payment options include lump-sum payments, installment payments that include 6 percent interest or a pay-as-you-go option that allows participants to gradually add more units as the family budget allows. Enrollment requires payment of a one-time application fee of $25 and the purchase of at least one tuition unit of any type. Texas residency requirements apply. Future payments can be as low as $15 if a pay-as-you-go account is established. An online calculator provides pricing estimates on the type and number of units currently needed for any eligible Texas public college or university.
For more information about this prepaid college tuition program, including how the plan applies a Transfer Value for use at Texas medical and dental institutions, Texas private colleges and universities, out-of-state colleges and universities, and career schools, go to TuitionPromise.org or call 800-445-GRAD (4723), Option 5.
The program’s outreach team also offers webinars to provide an overview of the plan and discuss the different tuition unit types and payment options, as well as provide information about Texas Match the Promise Foundation℠ matching scholarship opportunities*. Upcoming webinars are Sept. 16 at 10 a.m. and Sept. 16 at 3 p.m. All times are Central Standard Time.
Participation in the Texas Tuition Promise Fund does not guarantee admission to or graduation from any college or university. Only the purchaser may direct rollovers, Contract changes, withdrawals and changes in the designated beneficiary.
Purchasers should carefully consider the risks, administrative fees, service and other charges and expenses associated with the contracts, including Plan termination and decreased transfer or refund value. Transfer value is limited to the lesser of (1) the costs the Tuition Unit would cover at a public in‑state college or university or (2) the original purchase price of the Tuition Unit plus or minus the Plan’s net investment earnings or losses on that amount.
The Plan Description and Master Agreement contains this and other information about the Plan and may be obtained by visiting TuitionPromise.org or calling 800-445-GRAD (4723), Option 5.
Purchasers should read these documents carefully before purchasing a contract. Neither a contract nor any return paid with a refund is insured or guaranteed by the FDIC, the state of Texas, the Texas Prepaid Higher Education Tuition Board, any other state or federal governmental agency or NorthStar or its affiliates. The contracts have not been registered with the U.S. Securities and Exchange Commission or with any state.
Residency restrictions, age requirements, eligibility criteria household income restrictions and contribution requirements apply.