FL College Prepaid - What exactly is the Differential?

Paying for College
1

Hi everyone,

We have a 9 and 12 year old. The 12 year old was enrolled before the “differential” came into play and does not apply to him. The 9 year old, however, was born before the Differential went into affect, but unfortunately, we didn’t sign up until after the deadline (weren’t aware of the change). So his pre-paid plan does not cover those fees.

We’re trying to decide if this is a huge deal or not. The differential plan is fairly pricey to add on after the fact (and thus that option is really not even on the table). Some part of me wonders if we should just pull out what we’ve paid in and put it into his 529 plan. Otherwise, I also wonder if we should just pay off the pre-paid account and just deal with the lack of differential fees in 10 years. But what I don’t exactly understand, is what these fees are and how much they really amount to?

Any info on what exactly the differential is would be much appreciated.

2

I really, really hate the “differential” fees. See this link to see the typical breakdown for tuition and fees for a credit hour (using UF as the example).

http://www.fa.ufl.edu/bursar/current-students/tuition-and-fees-2015-16/fall-2014-students-for-the-2015-16-academic-year/

The total for Tuition and Fee’s is $212.71 per credit hour.
Of this total, $105.07 is TUITION.
$44.17 is the Tuition differential fee, per credit hour
Everything is are fees.

If you purchased one of the older plans (like your 12 year olds), then UF wouldn’t charge you the differential feed. UF would charge you ($212.71-$44.17) a credit hour, and then Florida Prepaid would pay $105.71 a credit hour (if you had the tuition only plan. If you also purchased the “fee” plan, it would cover most of the rest.

If you purchase a plan today, it would include the differential fee.

However, if you purchased the plan (which you may have done with your 9 year old), in-between this time period, the tuition plan did not cover the differential. You had to buy a separate “differential” plan.

Example,

Your 12 year old takes 15 credits hours in a semester.

He’s charged ($212.71-$44.17) X 15 credit hours = $2,528.10 a semester.
He’s prepaid plan would pay $105.70 X 15 credit hours = $1,585.50
He would still owe $942.60 (the rest of the “fees”).

If he had purchased a “fees” plan, it would then pay for most of these charges.

If not, he may have earned a Florida Bright futures scholarship. The best plan (FAS) pays $103 per credit hour
$103 X 15 credit hours - $942.60 in fees = a positive $602.40 deposited into the 12 year olds saving account. This money can then be used for room and board, books, etc.

The above is exactly the way it’s currently working for my daughter who’s in her 2nd year at UF.

I believe your 9 year old would be like the above, but they would be charged the full $212.71 rate, including the differential fee, so a total of $3,190.65. After the prepaid plan you would owe $1,605.19 (compared to your 12 year Old’s $942.60). After Bright Futures, he would still own $19.69.

So we’re talking about a $620 difference, each semester.

Hope this helps. It’s not definitive, and I don’t really know which plans your two children have, but I think this gives you a sense of how it works.

EDIT: I should note that even with the tuition differential fees, Florida’s public universities still charge very low tuition cost. Many other states charge two or three (or more!) times this tuition rate for in-state students.

3

thank you SO MUCH for taking the time to detail this out. Yes, you point out how confusing it can be, but this is great info. I’ve yet to come across anything that really told me exactly what would be going on, like this did.

Yeah, 9 year old was born late 2006 and the new differential went into affect early in 2007. I wish we had known it was coming as purchasing the plan earlier would have saved a lot of headache.

I suppose it is what it is now. Just probably going to pay off the FL Prepaid account and we’ll maybe try to put in a little more in his 529 to make up for the lack of having the differential covered.

And yes, UF is the preferred school of choice :wink: Good example.

4

You know, looking at your info a little more closely and looking at the UF site, I realized we didn’t do the fee program thru Fl Prepaid. I had no idea how much that was. I’m honestly in shock. I had thought that my getting the 4 year tuition (and differential for the 12 your old covered) we were almost all the way there. Those fees are as much as the tuition! Sometimes when I look at the costs of this Fl Prepaid program, it can get a little frustrating. And like you said, these are relatively inexpensive schools.

5

How much is the difference between the prepaid with fees and the prepaid without fees? If the extra is $20 per month, you may not be getting that much of a break, but of course you are guarantying a price lock of those fees (currently $44, but in 10 years could be much more). You could put the same $20/month into a 529.