College Savings Bank did offer CDs linked to college inflation as measured by the IC500 (Independent College 500 Index). Actually though, you received college inflation minus some percent, so it was effectively a sort of insurance against skyrocketing inflation.It is a random thought I had driving my four year old to preschool: Why isn't there an investment vehicle available to parents/grandparents like TIPS, but for college tuition? If TIPS can protect investors against "regular" inflation, why do we not have protection against the much greater inflation of college tuition?
What might the barriers be to an institution in the attempt to create a vehicle like this?
The product ran into trouble when interest rates dropped to zero around 2010, but college inflation was still 5-6%. They switched to fixed rate CDs that weren't all that competitive. I just don't think they had a risk free investment they could use to match college inflation.
In the end, I am glad I put most of the college savings into a 529 and invested in equities even though of course there is no guarantee as we all know.
Technically, the College Savings Bank CDs were an Arizona 529 plan. It got moved to Fidelity who administers it now, though if you have any CDs left you still have to redeem on the College Savings Bank site.
Statistics: Posted by typical.investor — Thu Jan 29, 2026 12:32 pm — Replies 7 — Views 213