The correct answer is the following: <em>option d. A plan that allows a family to pre-purchase one part of a college's cost of attendance is called a 529 prepaid tuition plan.</em> This type of plan allows parents, grandparents and other to prepay the tuition at today's tuition rates at the eligible public or private colleges or universities. Some pre paid plans offer contracts for a 2 year community college program or a 4 year undergraduate university program or even a combination of both. It also needs to be considered that most of these plans do not include any expenses beside the tuition fee, therefore room, board and health insurance is not included in the contract of the 529 pre paid tuition plan.
