One of the biggest investments a parent may make in a child’s life will be in their education. One thing we all know is that college is expensive and that can put a burden on many families. Many parents and grandparents want to save through an investment that will help them to achieve their goal while still allowing them control and flexibility.
This overview will provide the benefits as well as the drawbacks of the 529 Savings Plan, Coverdell Education Account, and Roth Individual Retirement Accounts (IRA).
Over the past decades, the total amount of student loan debt in the United States has more than doubled to over 1.3 trillion dollars. Although 67% of borrowers owe less than $25,000, for many who attend graduate or professional school, balances can grow much larger and payments can make up a large portion of monthly income. Since 2009, though, the number of options has grown dramatically.
In addition to ICR, the new plans include Pay As You Earn (PAYE), Revised Pay As You Earn (REPAYE), and Income Based Repayment (IBR). The last of those, IBR, was modified in 2010 with the new provisions only applying to the most recent of borrowers while the previous rules continue to apply to those who took out loans prior to 2014. [Read more]
If you are getting close to retirement age you may have heard of social security claiming strategies such as “file and suspend” or a “restricted application.” You may have also seen in the news that the November 2015 bipartisan budget deal made some changes to the social security system. While none of these changes will affect benefits that have already been claimed, those who are not yet retired may see a change in how they are able to receive benefits due to recent changes made by Congress.
When you buy a stock, you are buying a small share of ownership in a company. The price of that share is determined by market forces – more people wanting to buy shares of that company than sell them will raise the price whereas fewer buyers and many sellers will lower it. In the long run, if a company does well, the demand for ownership of that company would be expected to increase and the stock value to rise. A company that is struggling will generally see its stock price decline. If the company fails and has no underlying assets, the stockholder owns a piece of nothing and the stock becomes worthless.
When was the last time you reviewed your beneficiary designations for life insurance policies and retirement accounts? Very likely, the answer is "never." But you should review them periodically. Various life events can signal a need to review and possibly change your beneficiary designations. Consider whether any of the following events have occurred since you named your beneficiaries.
You've married or divorced. Some employer-sponsored retirement plans require you to name your spouse as your beneficiary unless your spouse agrees in writing to your naming another person. As a single parent, did you name your children as your beneficiaries?
It may sound like a challenge we'd all love to have, but handling a financial windfall intelligently isn't as easy as it might seem. Handled properly, the benefits and security of a financial windfall can last a lifetime. If not, it could cause more problems than it solves. If someone comes into money and that's publicized, they're likely to have friends and family and charities all pulling at them. The next thing they know, they look up and they don't have a penny left.
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Julie VanTilburg, CA Insurance License #0C21028; Maritza Rogers, CA Insurance License #0E50369; Robin Starr, CA Insurance License #0G64012; Jeffrey Better, CA Insurance License #0182274; Beth Borowsky, CA Insurance License #0M72593