A. 529 plan is better of the two, for the following reasons:
1. Prepaid Plan Only Covers Tuition
Room and board expenses, which could be half of the cost of college, are covered by 529 plan but not Prepaid tuition plan!
2. Prepaid Plan Requires to attend In-state Public School
If your child wants to go to a private or out of state college, it will not be covered by the prepaid plan. Even if you move out of the state and your child decides to go back to the state and attends the public school, he or she will have to pay out of state tuition which there will be a gap to fill.
3. Prepaid Plan Could Stops
At this time, only 16 states still offer prepaid tuition plan, the rest have cancelled their prepaid plans after finding that they couldn't invest the money to keep up with the pace of rising cost of tuition. In most cases, they return the money back with only a small amount of interest.