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The economic crisis may be forcing some families to choose paying the bills over saving for college. Withdrawals to pay for things other than college have more than doubled, officials from the state's college savings program say.

The College Foundation of North Carolina reported

$2.1 million was withdrawn from its NC 529 Plan but did not go toward a college education so far for fiscal year 2009. The withdrawn amount is the highest in the eight years that the NC 529 Plan has existed.

Jim Sutton, the program services manager of the savings plan, said CFNC has no way of tracking what people use the money for but they know when it's not used for college. He said it seems obvious that at least some of those withdrawals are because of the economic crisis.

The program had about $358.1 million in total assets at the end of last month, compared to $386.5 million in January 2008. And though the number of program participants has increased, the contributed amount decreased last fiscal year.

 "If you've got 12 to 15 years before your child goes to school, you might feel the need to hold back a little to pay expenses," Sutton said.

The NC 529 Plan is an interest-bearing savings account used for college education expenses. Families can make withdrawals without penalty for a handful of reasons, including the student's death or receipt of a scholarship. But the withdrawal penalties for nonapproved reasons include the regular tax rate and an additional 10 percent.

Financial adviser Jonathan Smith, owner of Jonathan Smith and Associates, said raiding any interest-bearing account is costly. Now that stock prices are at their lowest in years, the decision ends up being even more costly, he said.

But, Smith said, when you're having trouble paying rent or a mortgage, those decisions are made for you.

"Families find that they need to raid all sorts of savings to replace lost income," he said.

In some cases, Smith said, it may be less costly over the long term to take out a loan to cover pressing financial responsibilities such as a mortgage. He recommends speaking with a professional before making a decision.

Though the decrease in total assets and the increase in nonqualified withdrawals does raise eyebrows, Sutton said the NC 529 Plan remains strong.

"The program's still growing, people are still investing," Sutton said. "That, to me, shows that the program is still healthy."

Contact J. Brian Ewing at 373-7351 or brian.ewing @news-record.com