The state of Colorado is offering a new 529 program, Stable Value Plus, in addition to its more market-oriented five Scholar's Choice options managed by Salomon Smith Barney. The move follows the temporary closing of its prepaid Tuition Fund program to new investors last August.

Marilyn Quinn, chief operating officer - Savings at CollegeInvest, told MFWire.com that it is still "up in the air," whether the prepaid plan will be reopened. Meanwhile, the state is among the first to roll out a stand-alone stable value college savings program targeting investors leery of carrying too much risk.

Travelers' Group is managing the investment side of the new plan, and is offering the 3% guaranteed minimum rate of return. The plan, however, is not linked to tuition hikes.

As many state 529 programs have been grappling with the dual dilemma of rising tuition costs and falling investment returns, more are expected to turn to the stand-alone stable value option.

The Scholar's Choice program features investment style options that range from aggressive equities to 100 percent fixed income. 

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