"In a blow to parents already panicked about their ability to save enough for their children's college costs, some of the safest-sounding college savings plans are foundering," U.S. News & World Report reports. "Several plans marketed by states as 'guaranteed' to keep up with skyrocketing tuition inflation lost hundreds of millions of dollars in the markets' 2008 meltdown. At least two state plans -- in Alabama and Texas -- could soon end up paying out less than parents and students had expected, revealing the surprising flimsiness of many of the 'guarantees.' To add insult to injury, investors have little recourse, since a loophole exempts most of the state-sold prepaid tuition plans from most investor-protecting rules and watchdogs."