| $371,466. | | | | more information. One of the best reasons to |
| | | | choose a 529 is the fact you can withdraw the |
| That's three children attending an | | | | savings for educational purposes tax-free. |
| average-priced private school for 4.5 years | | | | |
| each, according to the 2004-05 yearly tuition | | | | IRA Withdrawals |
| report from The College Board. | | | | |
| | | | If a 529 doesn't sound appealing, you can |
| It may seem like a lot of money now. But | | | | always make withdrawals, (penalty-free) from |
| remember, it's the cost if your children were | | | | an existing IRA account for any educational |
| to attend college today. Factor in the rising | | | | costs. However, there are contribution and |
| cost of private school tuition (six percent | | | | withdrawal limits and not everyone can |
| per year) and the fact that your kids may not | | | | qualify for an IRA. |
| be going to school for another 10 years and | | | | |
| you're faced with the reality of a bill | | | | Coverdell Accounts |
| around $665,239 or more. | | | | |
| | | | If you have grandparents who wish to |
| Unless you have that kind of cash sitting | | | | contribute to an account, you may wish to |
| around, (and it's probably safe to guess you | | | | think about a Coverdell Savings Account. |
| don't) then it's probably wise to begin | | | | These types of accounts allow anyone with an |
| planning for your children's education as | | | | income of less than $110,000 a year, single |
| soon as you possibly can. The costs of public | | | | or $220,000, joint, to make yearly |
| in-state tuition will naturally be lower than | | | | contributions of up to $2000 in an account |
| the private college figures, but on the other | | | | that has a variety of investment options. |
| hand, these costs are quickly rising as well. | | | | Once the student turns 18, they have until |
| | | | their 30th birthday to withdraw the money for |
| Providing a college education is one of the | | | | educational use. |
| most important elements of raising children. | | | | |
| No one needs a reminder of how important | | | | Creating "tax scholarships" |
| education is in a person's life. According to | | | | |
| The College Board, the income-gap has | | | | Another option for college savings includes |
| recently widened between those with only a | | | | creating a "tax scholarship" for a child. A |
| high school diploma and those with a | | | | tax scholarship is a financial technique that |
| bachelors degree. Currently, people with a | | | | creates money by shifting assets to your |
| college degree will make over a million | | | | child over several years and by taking |
| dollars more in their lifetime than those | | | | advantage of their yearly tax capacity. These |
| without. | | | | tax savings can add up quickly and can mean |
| | | | possibly thousands of dollars in extra money |
| So what can you do to ease the burden? The | | | | that can be used towards a higher education. |
| single most important thing you can do is be | | | | Ask your financial planner for more |
| prepared! What was once a simple Boy Scout | | | | information on how to take advantage of |
| motto, has quickly become an essential | | | | shifting assets to children. |
| financial planning tip. You have a lot of | | | | |
| options when it comes to paying for college | | | | Planning for college can be overwhelming. The |
| and here are just a few. Remember, it's | | | | variety of options and plans available is |
| always wise to involve your financial planner | | | | enough to make anyone crazy. That's why it's |
| in the decision making process of most major | | | | important to always consult with your |
| financial decisions. | | | | financial planner before making any long term |
| | | | decisions. By teaming up with your planner, |
| Scholarships, Grants and Aid | | | | you may be able to send your child to college |
| | | | with the confidence and knowledge that your |
| There are several ways to pay for college. | | | | future, and your child's future, is |
| The first and most obvious is financial aid. | | | | financially secure. |
| This can include loans, scholarships, grants, | | | | |
| and work study programs. Even if your student | | | | You may also be able to save a great deal of |
| isn't in the top level of his or her class, | | | | money in the process, through tax credits and |
| it doesn't mean there isn't opportunity | | | | other incentives. |
| available for financial aid. A student can be | | | | |
| awarded grants or scholarships based on | | | | So give it the old "college try," and |
| financial need, academic standing, | | | | schedule an appointment today! |
| extra-curricular activities, and many more. | | | | |
| | | | End |
| Makes sure to always fill out financial aid | | | | |
| papers to qualify, even if you believe your | | | | Pursuant to the Economic Growth and Tax |
| income is too high to receive aid. | | | | Relief Reconciliation Act of 2001 ("Act"), |
| | | | qualified distributions are federal income |
| 529's | | | | tax free. The provisions of the Act will |
| | | | expire on December 31, 2010. Unless the law |
| One of the most crucial aspects of college | | | | is extended by Congress and the President, |
| planning is how you'll save up for it. If | | | | the federal tax treatment of 529 plans will |
| you're like most people, you've heard a lot | | | | revert to its status prior to January 1, |
| about the educational savings plans known as | | | | 2002. The underlying investments in these |
| "529's." These plans allow you to name a | | | | plans are municipal securities and may be |
| beneficiary to your account while you make | | | | subject to market volatility and fluctuation. |
| yearly deposits. 529's allow you a | | | | Please carefully consider each Plan's |
| wide-variety of investment options and it is | | | | investment objectives, risks, charges and |
| best to consult your financial planner for | | | | expenses before investing. |