The latest audit of the College Savings Iowa program shows fewer contributions were made in the last fiscal year.
The audit reviewed College Savings Iowa accounts from July 1, 2011 through June 30 of this year. There was a 53 percent drop in contributions to the tax-free college savings accounts set up and managed by the State of Iowa.
There was also a 14 percent increase in withdrawals, as more students reached college age. Nearly $200 million in investments were withdrawn to cover college expenses. There are nearly 180,000 active college savings accounts being managed by the state treasurer’s office.
As of June 30, 2012, the state was holding more than $3 billion in these trust accounts to pay out when the kids get to college.
College Savings Iowa accounts were created in 1998 to let Iowa parents and others create accounts with the state to set aside money for college expenses. In 2006 investment advisors were allowed to establish the accounts.