When it comes to Wall Street's 40 percent fall this year, the worries of some aging baby boomers extend beyond their 401(k) and IRA accounts. Americans had $101.7 billion invested in 529 college savings plans as of Sept. 30, down from $110.6 billion at the end of June, according to the College Savings Foundation.

Parents expecting to tap the tax-advantaged accounts for children entering college next year or in 2010 may be wondering how much their depleted savings will recover before then -- and how to cover the shortfall. While the damage is hard to stomach, advisers say there are options for parents who are flexible.

"You still have some time," said Nancy L. Skeans of Schneider Downs, a Downtown accounting and wealth management firm.

First, a word about how 529 plans work.

Named after the section of federal law that authorized them, the state-sponsored plans allow parents, grandparents and others to save in accounts where the earnings grow-tax free. Although 529 contributions aren't deductible on your federal return, you can deduct up to $12,000 per contributor, per child on your Pennsylvania return. That means a married couple with 529s for each of their three children could make tax-deductible contributions of up to $72,000 annually.

Withdrawals from 529s are federally tax-free as long as they are used for qualified education expenses. Pennsylvania does not tax earnings that are withdrawn and used for college expenses.

Basic 529 plans offer portfolios built around mutual funds managed by Fidelity, Vanguard, T. Rowe Price and other investment companies. The portfolios can be based on the risk investors are willing to take or on the age of the child the money is being saved for. Some states, including Pennsylvania, combine the two strategies, offering age-based portfolios for conservative, moderate or aggressive investors.

Investors who chose the risk-based option were the most exposed to Wall Street's woes. Those in age-based portfolios weren't as affected because the amount of stock in the portfolios is reduced as the child nears college age.

"They do become conservative very quickly. That can be an argument for or against using them," Ms. Skeans said.

While a more conservative approach limits losses in down markets, it can limit returns when stocks are doing well, she said.

In addition to mutual fund-based 529s, Pennsylvania and other states offer prepaid tuition 529 plans that allow investors to purchase tuition credits at today's prices that a child can use later. The plans are based on the premise that the state can invest wisely enough to outpace future tuition increases.

Once parents purchase credits, investment responsibility shifts from parents to the state. That's why James J. Holtzman of Legend Financial Advisors in McCandless moves 529 money into Pennsylvania's pre-paid plan -- called the Guaranteed Savings Plan -- when clients' children are 12 to 14. That shields their savings from the vagaries of Wall Street.

"We avoid this kind of nonsense," he said.

But what about parents who didn't see the train wreck coming?

Mr. Holtzman said they could tap other savings, increase savings or use loans for their child's first year or so in college, giving the market time to recover.

"It takes some flexibility to do that financially. Nonetheless, at least you give yourself a chance," he said.

Parents may find funding by completing the Free Application for Federal Student Aid, or FAFSA, Ms. Skeans said.

"Fill it out. You may be surprised. Your child may be eligible for something," she said.

Even if it is just a loan, that will give your 529 time to mend, she said.

Ms. Skeans said parents saving for more than one child could consider redesignating the beneficiary of a 529 from an older child to a younger one. The idea is the same: find other sources of college money to give the stock market time to recover.

Pennsylvania Treasurer Robin L. Wiessmann, who oversees the state's 529 offerings (www.nowu529.com), expects education aid will be provided for in the relief measures proposed by Congress and President-elect Barack Obama.

Ms. Wiessmann said assets in the state's $1 billion guaranteed savings plan were reallocated this summer to reduce the volatility. As of Sept. 30, about 57 percent was invested in stocks, down from about 70 percent at the end of last year. The shift provides greater certainty that the money will be there when parents need it, she said.

"We are quite comfortable with the amount that will have to be paid out over the next decade," Ms. Wiessmann said.

As a result of the damage the last bear market did to the guaranteed plan's portfolio, Pennsylvania imposed premiums. From 2003 and into 2006, parents paid $101.80 to $109.70 for $100 worth of tuition. Ms. Wiessmann said premiums aren't necessary now, but that could change in light of the portfolio's performance and 2009-10 tuition rates.

"We review it every year, so obviously that's an issue," she said.