Alaska college plan to give away money to boost enrollment

$25,000 scholarship account will be offered as part of Permanent Fund dividend program

Posted: Wednesday, December 23, 2009

FAIRBANKS - Administrators of the University of Alaska College Savings Plan hope a giveaway will revive interest from those who need to save money for higher education.

The college fund announced Monday that a $25,000 scholarship account will be offered as part of its Permanent Fund dividend checkoff program next year. People who direct half of their dividend to the College Savings Plan will be eligible for a drawing to receive the money.

There also will be four $2,500 winners.

Linda English, the UA College Savings Plan director, said officials hope the scholarships will entice rattled investors back into the market while increasing awareness of the need to save for college.

"After the year we've had with investments, I think it's important for people to get back into it," English said. "You need to get into it early so you can ride out any market fluctuations."

The savings plan allows people to put money into a tax-deferred investment account, with the ability to use the earnings to pay for higher education. If an investor uses the money to attend a University of Alaska school, there's a portfolio option that allows it to keep pace with tuition and inflation.

Permanent Fund dividend applications include an option to put half of each dividend into a college savings account. The option had been steadily increasing in popularity, climbing from 3,468 contributions in 1998 to 8,766 applicants in 2008, according to the Alaska Department of Revenue. But the total dropped 5.4 percent in 2009, to less than 8,300.

English said the scholarship will not require a gaming permit from the state; she compared it to contests offered by credit card companies each time a customer makes a transaction.

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