To the editor: There was a letter in the Oct 15 News-Miner critical of the Alaska 529 Plan. The author complained about the poor returns of the plan and suggested seeking alternatives. It is unfair to criticize the performance of the Alaska 529 Plan when the reason for the poor returns mentioned by the author are likely due to negative performance of the stock market broadly. If one wants to avoid risk in their investments, they should seek alternative investments within the array of portfolio options offered by Alaska 529, or simply not invest their funds into a portfolio that may lose value.
I can speak to this from experience. For our first child, we opened an Alaska 529 plan and invested a majority of the funds into the ACT Portfolio, which has the benefit of locking in tuition credits to the University of Alaska at today’s rates. This provides a hedge on the future value of one’s investment regardless of stock market performance. One will not find this in any other college savings plan and for anyone who thinks their child might attend UA, it makes complete sense.