An Important Factor in Cutting College Costs

Graduation studentsWhen parents save for college, they assume that they will need to cover four years of expenses to pay for a bachelor’s degree. However, statistics show that most college students take longer than the traditional eight semesters to graduate. Here are the latest graduation rates from the U.S. Department of Education: Four-Year Graduation Rates Public colleges and universities:  33...
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Good News for Retirement Savers

Many Americans who rely on financial professionals to manage their investments have long assumed their advisors are providing them with the very best financial advice. Unfortunately, too often that has not been the case. Some advisors are obligated to put their clients’ interests first when making financial recommendations, but many others are not. Historically, stockbrokers have been under no obligation to make their clients’ best...
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Saving for College: Account Ownership

There are two main ways that today’s families save for college costs: one is the 529 savings plan, and the other is through a custodial account, typically an UTMA account (Uniform Transfer to Minors Account.) In the past, clients may have used Uniform Gift to Minors Accounts (UGMAs) but most custodial accounts are now titled as UTMAs, and for all practical purposes, there is little difference. Another vehicle no longer much used is the Coverdell ESA (Education Savings Account) which has a contribution limit of $2,000 per year. 529 Accounts These accounts grow tax-deferred. As long as the...
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Where to Look for Home Loans

If you are contemplating buying a house, one of the biggest decisions you will face is deciding on this question: Should you use a mortgage broker or deal directly with banks when looking for loans? There is no one right answer, but here are some things to consider. Banks As Lenders The vast majority of homebuyers turn to banks when seeking mortgages. These institutions can be convenient because home loans are usually offered by a...
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The Best Way to Borrow for College

As recently as the early 1990s, most students did not take out college loans. Today, almost two out of every three college students borrow due to runaway higher education costs. The typical student borrower leaves college with roughly $35,000 in debt. As a result, federal college loan debt now exceeds credit card debt. The level of debt is less risky and more manageable if the student only has federal student loans. For most students that...
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Steps a Widow Should Take

The death of a spouse is one of the most traumatic experiences that someone will ever experience. It can also be a costly one,  if the right steps aren’t taken. In most cases, the husband dies first which leaves his widow struggling to deal with his passing both emotionally and financially. Here is some advice for widows which holds true for widowers as well. Know what needs to be done right away. While a spouse’s death will lead to many changes, it’s important to know which tasks should be attended to in the weeks immediately following. Bills need to be paid and so do taxes. Some recurring...
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How to Avoid This Tax Nightmare

Imagine this nightmare scenario: You have finished your taxes and feel a sense of relief as you hit the button to submit your return to the Internal Revenue Service electronically. The government, however, blocks the return. The problem? Someone else has already filed a fake tax return with your name and Social Security number! Unbeknownst to a growing number of taxpayers, crooks are filing fake federal and state income tax returns to...
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Two Important Social Security Strategies Disappearing

Two ways to optimize Social Security benefits, known as “file and suspend” and “restricted application,” were eliminated for most pre-retirees by the Bipartisan Budget Act of 2015. In the year 2000, Congress made changes to Social Security that allowed Americans who had already started their Social Security benefits to stop their payments, and continue to earn delayed retirement credits. Since monthly benefits are greatest if claimants...
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Don’t Make These 7 IRA Mistakes

The biggest source of wealth for most Americans is their retirement accounts and much of that money is tucked away in Individual Retirement Accounts. Roughly $7.4 trillion dollars is sitting in Individual Retirement Accounts, which exceeds the $6.8 trillion invested in workplace defined contribution plans such as 401(k) and 403(b) accounts. With so much money invested in these IRA accounts, it’s important to avoid costly mistakes. Here...
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States With the Greatest Tax Pain

As tax season approaches, here is a bit of good news from the nonpartisan Tax Foundation:  State and local taxes, as a percentage of Americans’ income, have decreased across the country. The foundation’s analysis of 2012 tax data concluded that the tax burden declined because Americans’ income increased at a faster rate then tax collections. You might assume that Americans pay the most taxes to the federal government, but in reality state and local taxes take a bigger bite. The foundation’s research revealed that 78 percent of taxes collected were from state and local governments. The average...
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