Weighing Pros and Cons of College-Saving Strategies By David Edwards About this article: College costs are skyrocketing. The tuition component of the Consumer Price Index jumped 6.4% over the 12 months ending with February 2002, compared to the 6.1% increase in the year ending December 2001, and the 4.5% uptick in 2000. It's not surprising, then, that parents and grandparents are concerned about how to fund their children's and grandchildren's college education. UTMA/UGMA accounts, education IRAs (recently renamed as Coverdell Education Saving Accounts), Plan 529 accounts or customized trusts? Which is the best option -- particularly if your goal is to transfer assets to descendants while still maintaining control over how those assets are used? First, remember the power of compounding: $10,000 deposited on behalf of a newborn grows to $39,000 by age 18, assuming 8% return and ignoring taxes for the moment. In 2002, individuals may make gifts of up to $11,000 per child. So two parents and four grandparents... Or, call us at 1-866-321-TSCM (8726) Monday-Friday, 8 a.m.-6 p.m. ET. Outside the U.S. and in Canada, call 1-212-321-5200.

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