PENNSYLVANIA

Pennsylvania TAP 529 -- Investment Plan

Type: Savings

Phone: 800-440-4000

State tax deduction for residents: No deduction

Open to nonresidents: Yes

Refund provisions: Penalty of 10% of earnings

Minimum/maximum contributions: $50 / $300,000

Only state residents can buy this plan directly; nonresidents must buy broker-sold shares. Either way, expenses are above average. You can choose from nine mutual funds, seven of which are managed by Delaware Investments. TAP 529 offers two age-based options: a conservative fund that starts with an 85% investment in stocks and an aggressive fund that's 100% equity for the child's first three years. By the time the child reaches 14, both options are weighted 40% in stocks, 60% fixed income.

The plan also offers five risk-based portfolios ranging from 100% equity to 100% fixed income and two socially responsible portfolios managed by Calvert Social Investment Funds.

Expenses range from 0.45% to 1.69% for direct-sold accounts and top 2% for some broker-sold accounts. TAP 529 charges a 0.35% program management fee and $25 annual maintenance fee that is waived when the account balance exceeds $20,000.

Earnings are state income tax-free and will not be considered when applying for state financial aid. The state, through the Family Savings Account Program, also provides a 100% match for contributions made by low-income families (income must not exceed 200% of the federal poverty standard).

Pennsylvania TAP 529 -- Guaranteed Savings Program

Type: Guaranteed Savings (Prepaid)

Phone: 800-440-4000

State tax deduction for residents: No deduction

Open to nonresidents: No

Refund provisions: Penalty of 10% of earnings

Minimum/maximum contributions: $25 / $300,000

Pennsylvania has made several improvements to its original plan. You can now choose one of several "benchmarks" for tuition growth, including tuition rates at public, private and Ivy-League schools. You can retroactively change your selection if, say, tuition growth at private colleges proves to be the better investment. If the program's underlying investments earn significantly more than the rate of tuition inflation, the program will share some of the surplus with participants. The fund is guaranteed to keep pace with tuition increases at Pennsylvania public institutions, four-year private schools and Ivy-League schools.

There's a $50 enrollment fee, and a $25 maintenance fee that is waived with automatic contributions.