Cracks are beginning to show in the financial aspirations of the high-net-worth, according to ongoing research by the Phoenix Cos.

For the first time since the Hartford, Conn.-based advisor started publishing its Phoenix Wealth Survey in 2000, college planning is a problem. At 91%, almost all high-net-worth individuals with children under 18 consider saving for their education a high priority, yet only 23% say their financial plan has already covered that objective.

And yet, despite seemingly needing all the help they can get, relatively few high-net-worth individuals are taking advantage of 529 college savings plans' tax benefits. "I was surprised at the low percentage of participation in 529s by high-net-worth individuals-only 31% of people with more than $1 million in net worth and a child under 18 are using one," says Walter Zultowski, senior vice president of research and concept development at Phoenix. "You'd think it would be a no-brainer."

There are several reasons why wealthy investors aren't using 529s, the first is simply that advisors may not be mentioning them, Zultowski says. Equally plausible, though, is that up until this year, "the 529 structure meant people could only change their allocations once per year, in order to protect people from themselves," he says. "But if you made a change early in 2008 toward an aggressive strategy and the market tanked, there was nothing you could do about it. Now, you can make two changes, but that might still seem too restrictive."

Whatever happens, high-net-worth parents and grandparents will still send their kids and grandchildren to college-the alternative is not an option. But 38% had considered changes in strategy, including delaying college, sending their children to cheaper schools, and asking relatives for help funding their child's education.

Now even the wealthy are struggling to make ends meet, add college savings to the growing pile of their financial discontent.

Zultowski notes a subtle shift in high-net-worth individuals' retirement concerns. Before last year, wealthy people were primarily concerned with making sure they maintained their current lifestyles in retirement. Now, many are more worried about outliving their assets. As a result, "there has been a shift toward delaying or putting off retirement, 18% somewhat later and 13% much later," he says. "A further 19% are at least thinking about it, which shows that at least half of high-net-worth individuals have been significantly affected by the financial crisis."

For both 529s and retirement planning, Zultowski proposes a conceptual rethink. In the area of retirement, creative work was being done to take annuities' guaranteed features and wrap them around managed accounts to create insured portfolios.

Just don't say the 'A' word, at least to the wealthy. "In focus groups, we got people to describe what sort of product they were looking for and they described an annuity," Zultowski says. "But when we suggested an annuity, they said they weren't interested because it cost too much and didn't offer enough control. Wrapping investment products with annuity features, though, avoids the 'A' word," he says.

The financial services industry could bring the same concept to college savings. It's easier to price these products when you have a long time horizon-it's more difficult when you have a maximum 18-year window, but the concept is an insured investment portfolio with the returns of a mutual fund that are higher than those of CDs. "So my question is whether this thinking will come from the retirement market to 529s," Zultowski says.