Talking to a Teenager Now May Save Them Tens of Thousands of Dollars Later

February 15, 2013

I like to write about the things I see in my daily life as well as some of the things going on in my family, and right now the family conversations have a very common theme.  My daughter is a senior in high school and recently was accepted to all of the colleges to which she applied.  Now, it becomes a matter of preference, location, and atmosphere and of course, the financial aid packages offered will factor into the decision as well.  She has known since she was 4 years old that she wants to be a teacher, so paying $60,000/year to go to an elite private school was not going to be an option for her.  Continue reading “Talking to a Teenager Now May Save Them Tens of Thousands of Dollars Later”

What Tootsie Rolls and Financial Aid Have in Common

November 23, 2012

Much to the chagrin of dentists everywhere, Tootsie Roll has been a staple of the candy business for a very long time.  This article talks about the Tootsie Roll Company being a very secretive organization.  And we thought it was just the CIA that operates in relative secrecy!  Tootsie Roll doesn’t give tours, they don’t give interviews to analysts and they don’t operate with much transparency.  It’s as if they have some magical mystery formulas that they don’t want the rest of us to know.  That reminds of an email that I saw from a friend at work this week… Continue reading “What Tootsie Rolls and Financial Aid Have in Common”

How Can You Avoid Being a Slave to Your Mortgage?

November 16, 2012

Lately I have talked to a lot of people who are interested in buying their first home and with a combination of today’s low interest rates and a housing market that does not have prices appreciating rapidly, this might just be a great time to be in the market to buy a house.  They understand that part of it but then don’t know how much house they can afford.  They are getting different opinions from different people in their lives.  So, are there any objective measures by which we can figure out how much house someone might want to consider buying?  Sure… Continue reading “How Can You Avoid Being a Slave to Your Mortgage?”

How Risky are Prepaid College Plans?

July 11, 2012

With soaring tuition rates and the increasing importance of a college degree in our economy, prepaid college plans have become popular over the last two decades.  However,  declining returns from the stock market, compounded by the recent financial crisis, have caused a large gap between the funds in these state-administered programs and the escalating costs of state schools.  So what exactly are prepaid college plans and how risky are they? Continue reading “How Risky are Prepaid College Plans?”

I Don’t Want My Kids to be Crushed by Student Loans. Do You?

June 08, 2012

I read this article titled “This Bright-Eyed Young Man Was Utterly Demolished by Student Loans” about (can you guess?) a guy who has experienced significant financial, personal and emotional hardship because of the financial responsibility that he took on with significant student loan debt.  I wish this were an isolated incident, but based on some meetings I’ve had with young people recently, I’d be lying if I said this isn’t becoming increasingly more common.  Maybe not to the extreme that Nick is experiencing, but there is a growing number of young people who may not be finished with paying off student loans until they are closer to Social Security than college. Continue reading “I Don’t Want My Kids to be Crushed by Student Loans. Do You?”

How to Get Tax Relief for College Expenses

May 30, 2012

We’ve been talking for the last few months about the challenges of sending a child to college. First comes the choice of savings vehicles from the hundreds of options: state-sponsored 529s, private plans, Coverdell accounts, and self-managed investments. Then comes the crash course in financial aid, where parents and students have to figure out their eligibility for grants, scholarships, and government and private loans.   Continue reading “How to Get Tax Relief for College Expenses”

Pros & Cons of a 529 College Savings Plan for Your Kids

May 16, 2012

Figuring out how to pay for your child’s college education can be overwhelming. The cost for one year of school at a public university is over $17,000 and is nearly $40,000 at a private school – and that doesn’t even include the price of room and board. Counting on scholarships to cover college costs is foolhardy and the availability of student loans (especially a loan with a good rate) is not guaranteed. Continue reading “Pros & Cons of a 529 College Savings Plan for Your Kids”

Is Graduate School a Good Investment?

May 10, 2012

Are you or someone you know thinking about going back to school? If so, you’re not alone. With the job market still weak, more and more people are wondering if it makes sense to go to grad school as a way to make themselves more employable. Continue reading “Is Graduate School a Good Investment?”

Funding Your Child’s College Education is Not Impossible if You Follow These Steps

March 26, 2012

This past weekend, I had the opportunity to visit my little two-year-old granddaughter.  Since we live out of town, my favorite memory of the weekend was walking into the living room on Sunday morning and the little darling looked up at me in surprise.  My step daughter said, “Noni (that’s me) is still here!  Isn’t it wonderful?”  A big smile and hugs followed.  Those are the moments that melt your heart.  Continue reading “Funding Your Child’s College Education is Not Impossible if You Follow These Steps”

Choice is a Good Thing, Right?

March 22, 2012

In the 1970s, I lived in England before Margaret Thatcher came to power. In those days there wasn’t a lot of choice for consumers at the supermarkets: three types of cereal – Wheetabix, cornflakes or oatmeal – and two kinds of instant coffee.  When I first returned to the U.S., I spent hours in the grocery store marveling that there was a whole aisle for cereals and another for cookies. And olives!  Six different varieties, based just on the olive’s size. Continue reading “Choice is a Good Thing, Right?”

Back to School Season Brings Tuition Bills to Your Employees

September 13, 2011

It’s that time of year again.  Summer is coming to an end (already!) and college classes are starting.  You know what that means for your employees that are parents – time to start writing those checks!

Unfortunately, sometimes those checks have nowhere else to come from but their retirement accounts.  If you handle the day to day administration of your retirement plan, do you notice an uptick in hardship withdrawal and loan requests around this time of year?  If so, these looming college costs could be the culprit.  According to the College Board, the average tuition this year is almost $8,000 for an in-state public university, and that doesn’t even include room and board, books, and other typical costs. Continue reading “Back to School Season Brings Tuition Bills to Your Employees”

Risk of Failure to Balance Budget

May 11, 2011

So in my last blog I outlined the real danger of government spending without a balanced budget.  If the government continues to borrow and spend, borrow and spend, borrow and spend, pretty soon Uncle Sam won’t be able to borrow any more.  If that happens – if foreign governments don’t lend the U.S. money, if investors don’t buy U.S. Government Bonds – how will the government pay for its expenditures?  This is a difficult question, and one we hope we never have to answer, but rather than cross our fingers and put our heads in the sand, we need to face this potential reality head on.  We know that the government’s going to have to do something, so here’s what you can do to be prepared: Continue reading “Risk of Failure to Balance Budget”

Ten Steps to Funding a College Education

March 30, 2011

So what does college planning look like in the real world?  That’s an excellent question, and since I don’t have a child in college yet, let me share with you what I hope it looks like:

My daughter Rachel is 12-years old.  She will be attending the University of North Carolina (she doesn’t know that yet, but she will—Go Tarheels!).  This year the cost to attend was about $6,000, so her mother and I will plan on paying for her tuition; she’ll be on her own for books, fees, and other expenses.  Her grandpa has already contributed $6,000 toward his granddaughter’s education, so we figure we’ll need to save another $280 a month to meet our goal. Continue reading “Ten Steps to Funding a College Education”

College Planning: A Conversation that Might Save Me $100,000 or More

March 25, 2011

One night not too long ago my daughter and I had a really good conversation about life, choices people make, who we like in this year’s American Idol (James!), and why she thinks her milkshakes are better than any that you can buy at an ice cream shop.  I’m sure there were plenty of other topics discussed too, but those are the ones that I remember the most.  And, she REALLY can make a mean milkshake!  Hey, a dad has to make sure that his kids don’t lie, right??? Continue reading “College Planning: A Conversation that Might Save Me $100,000 or More”

College Planning: The Tax Benefits of Education

March 23, 2011

Today’s blog is the last in a series addressing the different pieces of the college planning puzzle.  Last week we looked at financial aid and basically determined that no matter how much or how little we save for college, financial aid (primarily in the form of loans) will help us make up the difference.  That should provide some relief, since we would like to think that our children can go to whatever school they want to no matter how expensive.  At the same time the idea of our kids (and us) being saddled with debt right out of college doesn’t always sit well with us.  So how do we reduce our dependency on financial aid when the amount saved is not enough?  This will probably come as a shock to you (and yes, I’m being facetious), but parents and students are expected to use some of their current income to help pay for college. Continue reading “College Planning: The Tax Benefits of Education”

Financial Planning: Paying for College

March 16, 2011

In last week’s blog entry I discussed some of the tax-free ways to save for education.  If you are able to save enough to fully pay for a child’s education then I tip my cap to you because that is an impressive feat.  Unfortunately, for most parents the amount they are able to save will only cover a portion (and in my case a small portion) of the full cost of education, so in this week’s blog entry I’ll focus on the next pillar of college planning known as (imagine the thunderous voice of Zeus as you read) FINANCIAL AID. Continue reading “Financial Planning: Paying for College”

Bring Your Lunch to Work and Send Your Kid to College

January 17, 2011

Bringing your lunch to work will help you save enough to send your kid to college?  Yeah, right.  There have been books out in the past few years talking about how if you make your coffee at home you can retire on the proceeds – David Bach coined the phrase “The Latte Factor.”  Many people thought that made sense in the 90’s when the market went up almost every year.  They could take the difference and invest it in mutual funds.  But, does it really make a difference to scrimp and save? Continue reading “Bring Your Lunch to Work and Send Your Kid to College”

Offering 529 Plans via Payroll as an Employee Benefit

December 21, 2010

Employers may be missing a tremendous opportunity to help employees save for one of the most important, and expensive, investments they will ever make – the college education for their children.  We all know that one of the biggest advantages of an employer-sponsored retirement program is the automatic payroll deduction.  “Out of sight, out of mind” is what I hear consistently from employees when they think about the funds that are contributed to their 401(k) plans. Continue reading “Offering 529 Plans via Payroll as an Employee Benefit”