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School Stocks: What to Know before Setting Up an ESA

Posted on Jan 16, 2017 with No comments
You have likely heard it countless times before, but get ready to hear it one more time: failure to plan is tantamount to planning to fail. Not many costs associated with a quality education for your children, if any, will actually shrink by the time they finish high school.

A Coverdell Education Savings Account (ESA) allows up to 18 years of $2,000 maximum annual deposits dedicated to covering a sizable range of schooling costs. Any interest, dividends, appreciation, and other earnings generated by deposits remain absolutely tax-free as long as they are withdrawn to fund educational expenses no later than 30 days after the beneficiary turns 30. You can open a Coverdell ESA anytime before your child's 18th birthday, but the sooner you can establish one, the more rewarding it ultimately will be.

Timing Is Everything


Opening an ESA too late and trying to make up for lost time after your child's last year of high school may actually work to your detriment. For one thing, deposits made after your child turns 18 are subject to a 6-percent excise tax. After that, the earnings portion of any funds remaining in the account when the student turns 30 becomes subject to both a 10-percent penalty tax and federal income tax. More importantly, though, a ESA is no different from any other investment product: time is your best friend.

Suppose you open an account as soon as possible after your child is born. Assuming you max out contributions every single year, the principal alone will total $36,000 by the time your beneficiary turns 18. Assuming an 8.00% before-tax return and a 25% marginal tax bracket, your child's trust would eventually accumulate roughly $80,893, compared to the approximately (still impressive) $65,520 a taxable savings account would earn over the same period.

For some perspective, the total deposits alone would rival several states' median household incomes and even eclipse those of several U.S. commonwealths and territories. After taking interest into account, the balance would far outstrip Maryland's top-ranking median income totaling just barely over $70,000.

That kind of savings demands consistent deposits and the discipline not to touch them, but cementing fiscal resources such as those for your child first requires some prudent planning.

Contributing


We established that 18 years of age is the cutoff for both setting up and paying into a Coverdell ESA. Nothing stipulates that the beneficiary must be your own child or even related to you at all. Meanwhile, depositors must earn modified adjusted gross income under $190,000 to make a full $2,000 yearly contribution - $95,000, if you happen to be a single filer. Households that earn between $190,000 and $220,000 and single filers who claim between $95,000 and $110,000 can gradually phase out the $2,000 yearly deposit limit entirely. Since 2002, amended regulations have also allowed for contributions to both an ESA and 529 plan naming the same beneficiary.

Get this: if your own income is above the allowable maximum, your child can even make a Coverdell ESA contribution instead, provided his or her own earnings fall within the above-stated limits. Unlike a traditional or Roth IRA, nothing stipulates that a contributor has to have any earned income. Just gift the money to your child first. Your child can be named the beneficiary of limitless Coverdell ESAs, provided total contributions remain below the $2,000 limit, but most scenarios won't make the combination of minimums imposed by sponsors and various annual fees worth the trouble.

Starting a Coverdell ESA


Any financial institution that can serve as a traditional IRA's custodian, such as this credit union savings account, can get you started. Your trust's caretaker will invest contributions through the sponsoring institution's available qualifying investments, including mutual funds, certificates of deposit, stocks, and bonds. Life insurance is exempt from ESA investment. Once you complete the sponsor's enrollment paperwork naming the trust's beneficiary and a "responsible individual" trustee, it's time to make your first contribution and plant the seeds of your child's future.


Financial Aid Consequences


All of that being said, keep in mind that our Coverdell ESA comes with financial aid eligibility ramifications if you intend on using the full balance strictly to pay for college. Granted, it's a negligible dent in overall eligibility, but you cannot afford to entirely discount the impact.

Like a 529 plan, your student's Expected Family Contribution (EFC) includes up to 5.64 percent of a Coverdell ESA's value if a parent or student owns the account. You only report the funds of an account owned by another relative once you or your student withdraws funds.

It pays to be judicious when tapping into your balance, even for the expenses the trust is structured to cover. Your federal income tax return will ordinarily exclude withdrawals from Coverdell ESAs owned by a parent or student, but withdrawals from accounts owned by anyone else will be "added back" at up to 50 percent as student income on the Free Application for Federal Student Aid the next year. In more concrete terms, an aunt or grandparent pulling out $15,000 to cover a university bill means a $7,500 increase to the next FAFSA's EFC.

Use as Directed


It should go without saying, but in addition to taking the general long-term ramifications of every withdrawal into account, never forget what the "E" in your Coverdell ESA's name: education.

To maintain tax-free withdrawals and earnings, Coverdell ESA funds must strictly be used for qualified elementary and secondary education expenses (QESEE) or qualified higher education expenses (QHEE).

Let's run those down:


QESEE


  • Fees, tuition, tutoring, special needs services when required by the beneficiary, books, supplies, and other equipment incurred by enrollment and attendance.
  • Transportation, uniforms, supplementary items and services (including extended day programs), and room and board required or provided by the school.
  • Fees associated with any computer equipment or technology, internet access, and related services used by the beneficiary and family during school years.

Fortunately, the QHEE is much more cut-and-dried:

QHEE


  • Tuition and fees.
  • Room and broad, as long as the student is enrolled at least half-time (6-8 credit hours per semester, ordinarily).
  • If living off-campus, you can withdraw the amount of room and board costs the school includes in its cost-of-attendance figures.
  • Books and supplies as needed.
  • As of 2015, purchases of computers, software, internet access, and other related equipment are all qualified expenses.
  • Equipment and services addressing the beneficiary's special needs for enrollment or attendance

Remember, a 10-percent penalty tax and federal income tax will apply to all non-qualified withdrawals.

A Word on Credit Unions


We'll close by circling back to one of our earlier points. Yes, you can open a ESA with virtually any financial institution that routinely manages investment products such as IRAs. That doesn't mean some institutions won't provide notable advantages others can't or won't.

If you can, choose a credit union for your Coverdell ESA. Generally speaking, these alternatives to bigger banks offer vastly more personal customer service. Who wouldn't want a locally oriented account custodian that takes the time to get to know your family's education needs as closely as a trusted friend? Just as importantly, credit unions often offer interest rates that banks can't touch, along with minimal transfer and maintenance fees, and deposit insurance up to $250,000. Your ESA is one of the most valuable investments you will ever make, after all. Why not trust it to the most dedicated, personable partners you can?
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5 Unique Tips For Financially Preparing For College

Posted on Dec 24, 2016 with No comments
A common goal that many parents have is to save enough money to put their kids through college. However, since the cost of college is rising so fast, this can seem like a big challenge to many people.

For those that are looking to send their kids to college, here are five unique tips to follow that can help you save money and better prepare for your child’s future education.

Estimate The Cost


The first tip for financially preparing for college is to properly estimate the costs of the education. Many studies today believe that college will cost significantly more in the future. By the year 2030, college could cost over $100,000 at private schools every year and state colleges could cost over $40,000. 

When estimating the budget, you will also need to factor in other expenses such as commuting, living expenses, and spending money. Make sure that you really take the time to sit down and really figure out how much college is going to cost you.

Set Goals


Another tip for saving for college is to set a goal for what you would like to provide your kids. While paying for the entire education may be a goal, it can be impossible in some cases.



However, you should set a goal for a certain percentage of the education that you want to cover. Based on this, you will be able to figure out how much you have to have saved before your kids go to college.

Start Early


The most important tip that many parents should follow is to start saving as early as possible. While 18 years may seem very far away, the years will go by very quickly and you can miss out on a lot of compound interest if you do not start right away. 

Ideally, you should start funding the college savings account right after they are born.

Investment Strategy


How you invest the money is just as important as how much you save. Many experts agree that your investment allocations should change as the child approaches their college years. 

When the kids are young, you should focus on investing largely in stocks and mutual funds. However, when they are approaching the college age, you should re-allocate into a more conservative mix.

Other Financing Options


As your child approaches college, you should start looking more into scholarships and student loans. Many colleges, local communities, and private ventures have scholarship programs that could help reduce your cost. 

Furthermore, most schools, including UC Clermont College, have financial aid offices that can help you receive grants and loans.

In conclusion, paying for college for a child can seem like a daunting task. Luckily, you can just take your time and save over the years. Just be sure to follow these five unique tips to help make sure that you are as financially prepared as possible.

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5 Foolproof Ideas to Choose the Right English Tutor in Melbourne

Posted on Dec 16, 2016 with No comments
Are you worried about the weak performance of your kid in English subject? If yes, then you must hire a good English tutor for him. If you live in Melbourne, then you must know that many people in this city hire home tutor for improving the performance of their kids. 

But hiring the great English tutor in Melbourne is a very challenging job and lack of information prevents people to do this job successfully. If you want to know 5 foolproof ideas that will help you to choose the right English tutor, then you must read this article.

An English tutor who has lots of knowledge about this topic can help their student to learn this topic properly. But before choosing the right one, people should also check that whether the tutor has teaching ability or not. 

Person who has enough knowledge but don’t know how to teach, then he or she cannot teach his or her students. At this present time, a number of online sources help people to find the good home tutor. 



Some people don’t want to hire tutor through the online since they think this kind of source doesn’t provide authentic people. If you also think same matter, then you must visit the reliable online source. 

Reputable online sources help people to find the good English tutor. Furthermore, you should apply some ideas that will help you to handle this project successfully.

5 Foolproof Ideas That Will Help you to Select the Rright English Tutor


1. Check the authenticity of the source: You should check the authenticity of the source since authentic online sources offer the best service. In fact, you should visit the web pages of the source since through this way you will get lots of information about this source.

2. Check the qualification and ability of the tutor: before choosing the home tutor, people should check their qualification and ability. Remember, people should hire tutor who has sufficient knowledge and ability.

3. Visit their references: Before finalizing the deal, people should ask them about their references. Thus, people can get a concept about the service of the source and also about the ability and honesty of the tutor.

4. Visit their terms and policies: Before finalizing the deal, people should visit the terms and policies of the source.

5. Service charges: Before availing the home tutorial service, people should check their service charges.

If you follow these above tips, then you will choose the right English tutor in Melbourne for your kids. Now you must be thinking that where to avail this service? Well, in this case, you must contact with any reputable source.

Reputable online sources have a number of efficient and qualified tutors and they help their students to learn the subject properly. 

Along with being qualified and eligible, they are also very honest. Many people in Melbourne have availed service from these reliable sources and they are very pleased. If you also want to hire a good home tutor for improving the performance of your kids in English, then you must follow this article. 

Hope, it will help you to find the right English tutor for your kids.


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Six Financial Tricks for Getting Out of College Debt-Free

Posted on Dec 1, 2016 with No comments
Contrary to popular belief, it is possible to get through college with no debt. That means no student loans, no credit cards, and no signature loans. 

Most people opt for the easy way out and get student loans. However, if you utilize the following tips, you can get through your undergrad and get your graduate degree with no debt. Be smart and do your research before jumping into any future financial decisions.

Grants and Scholarships


Pell grants, scholarships, and other types of grants are out there for the taking. Pell grants are easy to get and you can apply to get these when you go through the traditional student aid process and file your FAFSA. 

Scholarships and other grants take a lot of hard work. You have to complete applications, write essays, and pay attention to deadlines. If you are willing to put in the work, you can get a lot of money from these sources. 



Even your school might offer academic scholarships, so see what you can do to improve your grades and application process.

Work Part-Time


Most full-time students choose not to work full-time so they can concentrate on their studies. This is great, but you aren't going to be able to get through school with no debt unless you pick up some kind of part-time employment. 

Just keep a close watch on your schedule so you don't miss a shift at work or blow off an exam or paper. Work-study opportunities are available at most universities as well. These mean you work for the university and instead of getting a paycheck that work goes toward your tuition in some way.

Online Classes


Online classes are a great option if you need a flexible schedule so you can work. You can work on your online coursework at night, on your lunch break, or on the weekends. Plus, you don't have to buy gas for the commute or coffee at the cafeteria to wake you up, so you save money there.

Evening Classes


If you have to work full-time, pick up a few evening classes so you can finish your degree faster without interfering with your work schedule. 

You can go straight from work to school, and use any extra time before class starts to study in a quiet area. It can be tiring, but it will be totally worth it once you have that degree in hand.

Military ROTC


If you are a good fit for the structure and rigors of military life, talk to the ROTC recruiter at your school. ROTC will give you a full scholarship to pay your tuition, plus you get a monthly stipend to help cover some living expenses. 



All you have to do is commit to a few years of active military service after you graduate. Plus, a military career as an officer has options for you to finish a Master's in a military history degree, business administration, or other disciplines with no debt.

National Guard


Interested in the military but want to fulfill your military service obligation while you are in school? The Army National Guard or Air National Guard is your best bet. 

You are given free tuition in most states at select schools, plus a Montgomery GI Bill monthly stipend so you graduate debt-free. In addition, you earn a monthly paycheck for attending monthly Unit Training Assemblies and an even bigger check in the summer for attending annual training. 

You can also take advantage of extremely low cost medical and dental insurance options through Tricare Reserve Select and the Tricare Dental Program. And your enlistment will end when you graduate school in many cases. Contact your local Army or Air National Guard recruiter for more details.

Getting a degree can be done without going into debt. Just use a few of these ideas to help you make a smarter financial decision as you prepare for college. With the right tools and experience, you can get through your schooling without a cloud of debt following you.

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5 Benefits of Earning a Degree in Finance

Posted on Nov 16, 2016 with No comments
It takes time and money to earn a degree, but you are investing in your future. There are always advantages when you gain more knowledge in a specific field. Here are five benefits of continuing your education to earn a master's degree in finance.

Learn from Experts


Within a master's degree program for finance you will learn valuable skills and make contacts with others working towards a similar degree, as well as experts within the field.

Most likely, you will have internships or externships where you will gain knowledge from financial gurus who know the ins and outs. They can guide and mentor you on your journey towards earning your degree and potentially help you start a career within the financial sector.

Variety of Jobs


There are numerous jobs and places to work within the field of finance. You could choose to work at credit unions or private banks, insurance companies, brokerage firms, financial planning, investment services, and other financial institutions. 



If you are more of the entrepreneurial type, you can be your own boss and be a personal finance coach. There are many career choices within the financial arena.

Personal Knowledge


There is no denying that people in every walk of life must deal with personal finances. Working towards a degree in finance will give you classes and training that provides you with knowledge that others may have to learn through trial and error. 

Taking control of your personal finances to build wealth and financial security is something you should be able to apply from your courses.

High Salary


Another benefit of a master's degree in finance is the potential to earn a higher salary. With a finance degree, you could earn between $60,000 to more than 100,000 depending on the job you choose. 



According to the Bureau of Labor Statistics in 2015, the median annual salary for personal financial advisors was $89,160 annually, and financial managers made $117,990.

Job Growth


Pursuing a degree in finance will help you to work in a field that is expected to grow in the future. In fact, the Bureau of Labor Statistics reports 632,400 new jobs will be added to business and financial operations between 2014 and 2024. 

You should be able to find a job where you can use your skills and knowledge from your finance degree.

By putting in time, energy, and money, you will set yourself up for a lucrative career in finance where you will have many options. Not to mention, your resume will show potential employers the accomplishments and dedication you gave towards furthering your education by earning a master's degree in finance. Furthermore, you will learn skills that you can apply within your personal finances.

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Getting Through Your College Years: How the Best Technology Can Help You Succeed

Posted on Nov 10, 2016 with No comments
College work shouldn’t be more stressful than it has to be. The right tech gear makes all of the difference. It is important to consider ease of use, portability, and the speed of the technology that will help you to succeed in college. 

Who knows technology like this may help you take up an interest in the technology field. You could even become a technical expert you could be working with businesses such as Ottawa IT Support to help you find the best possible success. Here are just a few devices will make the difference between success and failure in college.

Microsoft Surface Book


The Surface Laptop is a light, portable device that comes in a small package, but packs a powerful punch with 2GB memory and i5 or i7 Intel Core processors. It offers up to 1TB SSD storage for all of your audio, video, and school files. 



The Surface Book weighs a mere 3.34 pounds and it has up to 16 hours of battery life, helping it to last through all of your classes during the day and well into the night on a single charge.


Logitech K380 Bluetooth Keyboard


A keyboard is a keyboard, right? Not quite. The Logitech K380 keyboard connects via Bluetooth to any device. If you are on the go and need to write a paper, connect this keyboard to your tablet, computer, or cell phone via Bluetooth. 

It’s very useful for students who use a variety of devices to draft their school work.

SanDisk Ultra Fit USB 3.0 Flash Drive


This tiny USB flash drive is easy to carry along and stays out of the way. It can be password protected, for your security, and is extremely fast, moving files at a rate of 150 MB/s. 

As a bonus, it comes with a 1-year subscription to RescuePRO software to help you recover data that may be lost by accident.

Glyph Blackbox Plus


When you want all of your files on hand, but don’t want to carry your laptop around, the Glyph Blackbox Plus is the perfect solution. 



It can hold up to 2TB of data and features a rugged design that will provide great protection for your files. Included are USB-C and USB 3.0 cables for quick file transfer.

Having the right technology on your side is the key to success. These devices are sure to make your life much easier. 

Whether you are carrying them to class, a friend’s dorm, or working in the library, they will ensure you succeed throughout your collegiate career.

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Financing Education: 5 Ways to Help Pay for College

Posted on Nov 5, 2016 with No comments
Whether you’re an undergraduate or working on a master’s in computer networking, a college education is an important aspect of one's life. It dictates career opportunities and personal capacities. 

Over the years, however, the rising costs of college education have brought upon billions of dollars’ worth of debt and millions of students scrambling to get a job to repay the loans before it gets insurmountable due to interest. 

Luckily, a college education isn't just reserved for those born with a silver spoon in their mouth. Students on a shoestring budget can still finance their way to higher education and, subsequently, a better life.

Work


Working part time in college and still passing your classes is more than possible. Ideally, you could get a job on or within walking distance of campus, like driving your campus school bus or giving prospects a premier tour. 



Regardless of what you pick, getting part-time work is a simple way to finance your college education. It also teaches you how to manage time wisely since you'll often need to tailor your part-time work schedule with classes. 

Having work experience also gives you competitive edge in the workforce against other fresh college graduates.

Apply for Aid


To be considered for financial aid, you'll need to secure and submit a Free Application for Federal Student Aid (FAFSA) form. 

Depending on where you plan on enrolling, additional requirements may be applied, such as CSS or Financial Aid Profile. Completing the FAFSA gives you eligibility for the highest amount of financial aid possible for your given circumstances and chosen college.

Get Good Grades


Getting good grades in high school is a prerequisite to grabbing some grants and scholarships for your college education. Common options for grants include the National SMART grant and Pell grant. 



Each grant program has its respective set of requisites, which you'll find on their websites. Top grades can land you a full-ride scholarship, some of which can pay for everything from books to food.


Get Local Help


There are many local institutions that provide scholarships for students who are enrolling in a local college/university. 

Civic and religious organizations alike have awarded significant sums of money to their students' education. You can find many legitimate websites providing a list of grants and scholarships within your local area.

Capitalize on 529 Plans


For high school students who have enough time before they start applying for college, a 529 plan can be an attractive tool for you. 

The plan basically enables students to choose from a set of funds in which to invest. The investments range from money market funds to residential and commercial properties.

Financing your way through college can be tough at times, whether you're the parent or the student. With these five techniques, however, you'll be able to cushion the financial blow and put yourself at a better position after college.


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