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Why Should You Opt for a 529 Plan?

Posted on Jul 31, 2013 with No comments

Jul 31, 2013

No matter in what standards your kids are, you must plan their education from the very initial days. After managing all your daily expenses, paying off all those utility bills and planning vacations each year, it might not be possible for you to save money for your children's future education. As an alternative option many opt for a conventional life insurance, whereas others prefer to invest in a 529 plan.

529 Plans are exclusively designed for the parents, who want to secure the higher studies of their children. By opting for this plan, you can start saving early and continue with the plan thoroughly. It is one of the most convenient as well as affordable mode of savings for college that is followed by most of the families. One of the greatest benefits of this type of policies is that you get to enjoy a host of substantial tax benefits. Moreover, the different states offer a wide range of features and benefits to help the families financially so that they can reach their college saving goals.

If you are not quite aware of this type of plan, here are the different features of 529 Plan - 

State Tax Benefits – Apart from the conventional benefits that are available with this plan, the individual states, too, offer some additional tax benefits. Make sure you ask the concerned authority in your state what are the significant benefits that they offer. These may include income exemption on withdrawals or upfront deductions for your contributions. You can do a thorough research online in order to find out what special benefits the residents of the state receive for opting for a 529 plan. If you find that there is no such benefits, try out getting a 529 plan when it is on offer.

Federal Tax Benefits – the reason why 529 plans are so very popular among the parents is that it offers unbelievable range of income tax breaks. Even though the contributions that you make, are not deductible from the final federal tax return, the investment becomes tax-deferred. In fact, the tax-free treatment was made mandatory with the help of the Pension Protection Act of 2006.

Low maintenance – Another key reason why these 529 plans are so immensely popular with the parents is that it offers a low maintenance. After you have decided which plan you would buy out, you just need to fill out a simple enrollment form with certain basic information and make your contributions; or else, you can also opt for a automatic deposit system. After that, you really don't need to worry about it. The continuous investments of the account will be handled by the plan itself and you don't need to get involved.

Flexibility – The best thing about 529 plan is that it offers absolute flexibility, that is you might shift to a different plan like relevant life policies or in any other option of the 529 plan, itself, every year or you might also shift to the 529 plan of a different state in case you are moving out of the current state.

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Decalogue to Choose the Best B-Schools

Posted on Jul 25, 2013 with 1 comment

Jul 25, 2013

At this time every year, thousands of professionals and fresh graduates start looking for postgraduate programs in management to learn new management skills to get a job or start a business. A very important thing, which many students and their parents ignore, is taking out time to analyze information, ask questions and take into account a number of factors to choose the most suitable business school.

Your career success largely depends on the management institute you gave chosen, in terms of qualitative and practical education. Nowadays, every student prefers opting for the MBA courses, but only a few among them find an institute, which can make up their career. Make sure that you do not study just to get a certificate, but also learn the practical business world and make yourself competent enough to stand in this dynamic professional world. There are a number of top MBA institutes in Chennai, Bangalore, Mumbai, Delhi and other cities, which offer competitive courses to excel in the professional field.

As an MBA aspirant, you must devote sufficient time to gather information, reviews and testimonials about business schools, which you are considering to be enrolled. It is very important to ask questions and analyze what is most suitable for your profile, your goals and your abilities. To opt for an MBA program, it is not enough to choose from, because it is a decision, which will involve a financial investment but also commitment, time and efforts.

Here are some pointers that can help you to find out the most suitable colleges for pursuing top full time MBA courses in Chennai.

1. The selection procedure: It is important to learn how the college conducts entrance examination and the steps involved in admission procedure. In most of the institutes, the entrance test usually includes a written test, a group discussion session and a personal interview.

2. Scheduling full time or part time courses: Currently, there are a number of programs offered by the management institutes, which include both full time and part time courses. The professionals who do not have time to attend classes can look out for the part time courses. Make up your minds regarding the type of course you would prefer to take up.

3. Selection of specialized or generalist MBA program: Specialized Master's degrees are recommended for youth who want to be directed towards a sector, or professionals who need to redirect their path or reenlist into the labor market. Many experts have pointed out that the future of training for professionals depends largely on the degree of specialization.

4. Classroom or e learning programs: The traditional classroom learning has become increasingly costly and this is the reason why the education experts advise to look out for online management programs. Internet programs are best for those who cannot attend campus classes due to time or geographical reasons, or who just want to acquire specific knowledge about a certain subject. However, people now have started to believe that e learning can be sometimes more intense and participatory.

5. Competition from outsiders: India is a well-known hub for management education. Various colleges have quota for NRI and foreigner students who can be a tough competition!

6. The curricula: To learn about the courses being taught that the institute of interest, you must have a practical approach. Ensure that the academic programs offered by the business school are providing clear and detailed information.

7. Business Recognition: One of the major issues is its recognition in the business world, as it will define the career opportunities for you in future. While choosing the suitable learning center, learn about their ways of collaboration with the business school, the possibilities of working in the companies upon completion of the program and the school's reputation in the business world.

Another clue to the recognition of the center is if they have any accreditation from agencies that certify the quality of teaching, for e.g. University Grants Commission (UCG) and National Assessment and Accreditation Council (NAAC). The alumni of these institutions can offer the first hand view of the institution and detail about the institution. Currently, social networks provide a good platform to get in touch with alumni and employers, and get a good idea of ​​the reputation and employment opportunities in the said business school.

8. The faculty: Have a complete idea about the faculties in the institute. Inquire whether they are full time or part time! You have to know the composition of the teaching staff, and have data on their training and career. Even, you can contact any of them to get an impression about the program.

9. Careers prospects: It is among the most important factors to consider when selecting a business school. Through this service, companies do get job offers to students and alumni. A good option is to contact professionals who have graduated from the said institution or teachers who took up classes. Today it is easy to do through social networks like Facebook, Twitter or LinkedIn.

10. Facilities and services: Always make it a point to visit the institute in person to see the facilities and services such as library, access to publications, study rooms, Internet access and others.

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3 Things College Students Should Know About Credit

Posted on Jul 16, 2013 with 3 comments

Jul 16, 2013

College is a time for great personal growth and, of course, higher education and learning. And while many students walk away from their time on campus with a degree and a better-than-average understanding on topics like Modern Literary Criticism or Organic Chemistry, very few graduate with even a clue on how credit works.

Look, I'm not saying the system is necessary failing young consumers, but for $40k a year you would hope at least one of your professors would address this topic, no matter your major. Alas, we're here to help.

I know it's the summer, but for college students interested in leaning a little bit about their credit scores, here's a (Free!) lesson on 3 things students should know about credit...

1.)    No credit isn't good credit

A misconception that many young people have regarding credit is that having no credit is the same as having good credit, as if each consumer starts with a perfect score and every time they open a credit card or make a purchase knocks that score down a bit.

This is NOT the case.

Having no credit is, frankly, no good at all. No credit history means you're highly unlikely to get approved for loans you may want or even need later on, including auto loans, personal loans, business loans and mortgage loans. And while this may not seem like a big deal in your college years, it could have big (and expensive) consequences later on.

That's why this next tip you should know about credit is an important one to consider...

2.)    It can be easier to build credit in your college years

This is still true, despite the fact that the Credit CARD Act of 2009 set forth requirements for what a consumer under 21 years of age needed to get approved for a credit card. As required by the law, students 21 and under must either show sufficient proof of income, or provide a co-signer to get approved for a credit card.

“Sufficient income” means different things to different credit card issuers, but what it's basically saying is that you need to show creditors that you can pay your credit card bill each month. Basically, you need a job.

So why is it still easier to get build credit in college? First, the credit card offers are pretty good in college. Credit cards like Discover it® for Students and the Citi® Dividend® Card for College Students offer cash back on all purchases, no annual fee and low ongoing interest rates. The modest amount of credit required for approval of these cards makes them that much more worthwhile for students to consider, and are a lot better than the cards they're likely to get approved of after graduation and can no longer use that valuable “student” label.

Essentially, the longer you wait to build credit, the worse the credit card offers become. Start early, get your foot in the door with an excellent issuer, and begin building your credit score in college.

Finally...

3.)    Revolving credit can improve your credit quicker

Many college students have student loans, which means they do have a credit history up and running. Students loans are considered installment loans (or closed-end credit) since there's an end date for these types of loans and a set monthly payment to make; the same can be said for auto loans. These lines of credit do in fact build credit, but not as much as credit lines that are considered “revolving credit” - aka credit cards.

Revolving credit (or open-end credit) have no end dates and no set monthly payments. This is the type of credit issuers like to see, since it shows how well a consumer is able to use credit and (ultimately) the odds that you'll be willing to carry a balance.

Installment loans outline exactly what you're required to pay each month, giving creditors a sense of your monthly loan obligation. These payments are often higher than those required be revolving credit lines like credit cards, They also don't improve your overall credit utilization ratio – which is the amount you owe relative to the amount of credit in your name – since that line of credit is essentially spoken for in the form of a student loan, a car, etc.

The long and short of it is that using a credit card can help students to advance their credit score quicker. According to the makers of the most widely-used model of credit score in America, FICO, a consumer's payment history and amounts owed collectively make up 65 percent of their total score. Making payments on time each month and keeping a low balance on your credit card relative to your total available credit are the easiest ways to build credit, no matter your age.

In Conclusion
It might not seem like a worthwhile undertaking now, but it only gets harder to build credit the longer you wait. Plus, if you only plan on holding on to that summer job through, well, the summer, now is as good a time as any to apply for a student credit card.


Apply for a card, use it sparingly, and pay it off each month on time and in full to build credit. That's as simple a lesson you're likely to earn in four years of college. (So how come no one seems to bring it up? … )


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Make a Good Impression on Your First Day of Work

Posted on Jul 9, 2013 with No comments

Jul 9, 2013

As you approach a new job, it’s normal to be excited yet terrified! If you are starting off on your ideal career path, this could be the beginning of realizing a lifelong dream and it’s vital to make a good impression from the offset. The way your colleagues and superiors perceive you on that first day could make a lasting impact, for better or for worse.

To make sure that your lasting impression is definitely for the better, follow these five simple tips to getting things off to the best start:

Get there on time


The first rule of any first day at work is to get there on time – in fact, get there early! Nothing will have an employer second guessing themselves more than you failing to make your first day at the exact time you’ve been provided. If you’re unsure what time you’re supposed to be meeting, take the time to ring up and confirm a few days before. And make sure you set your alarm clock with at least half an hour to spare, so you really won’t have an excuse.


Overdress (a little)


When it comes to the company dress code, err on the cautious side. It’s always better to be looking a bit too smart, than a bit too shabby! If you’ve been told to dress casual, opt for a casual shirt and smart-casual trousers as opposed to a tee and shorts. If you’ve been told to dress smart, opt for full suit attire – you can always remove your tie and jacket during the day if suitable.

Be polite


Good manners should never be underestimated. New colleagues will be wary of you on your first few weeks in the office, you need to build their trust and demonstrate your personality – which you’ll have time to do as you settle in. To begin with just make an extra effort to be courteous to everyone around you; be on your best behavior. It’s best not to use sarcasm and controversial topics of conversation, and swearing should also be a big no-no.

Ask questions


One of the worst things you can do on your first day is bumble along not having a clue what’s going on! Show that you are confident enough to ask for guidance when you’re unsure and that you have an inquiry mind when you feel that something has been left uncovered. That said, don’t ask questions just for the sake of it. If you ask questions about things you actually already understand, you’ll come across as a slow learner or that you haven’t been listening to earlier discussion.

Be friendly


Don’t let nerves get the better of you; meeting new people can be daunting but it’s essential that you come across as personable on your first interaction with them. Present yourself as well-rounded and willing to listen to everyone. When introducing yourself for the first time, a smile can go a long way and so can that first firm handshake, because some people will be judging you on that alone!


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How Can a College Student Invest

Posted on Jul 7, 2013 with No comments

Jul 7, 2013

The younger you are when you start investing, the more money you will have when you are at retirement age. A college education is the best time to start learning about financial freedom, and building an investment. Mistakes that are made during college years are easier to overcome because less money is at stake.

Start With Stocks


College students will find the best way to ease into investments is through the stock market. The stock market can be tricky, but one will learn if they purchase a stock and keep it stable, money can be made. Stocks also can start as little as a penny to purchase, and build quickly. Fortunately, the stock market is something that if you get started with, you can quickly make up the money if a dip occurs.

Getting Started


Learning how to trade is the most basic part of the stock market. You should always practice trading before you actually put money down. This is the best way to learn about trading and analyzing the results.

Obviously when you get started in investing, you will want to know everything you can about stocks and the market. You should start with learning what a stock actually is. A stock is a part of a business that you own; it is an interest in the business. When you own a piece of the business, you have a say in changes that occur. The goal with stocks is the ability to raise the equity of the business.

Trusts


Another form of investment for college students is with a trust. Trusts are a way to build up money slowly and have when you are older. Trusts can be built to make sure that your funds go to whomever you see fit, and many times they have rules about when money can be taken out.

Commodities


Investing in cold, silver, and other commodities are another way to save money for your future. You will want to invest in commodities that are stable, such as precious metals, sugar, and wheat. Doing your research before buying is also vital.

Assistance


If you are looking at investing, then join a club that will help you out when you have questions. Clubs are also useful when it comes to learning about new stocks, bonds, and IRAs. They are also there to help you start small and grow your wealth.

Invest in Many Areas


It is wise never to have all your money in one place. It is better to invest in many areas with smaller amounts to spread out your wealth. That allows you to make sure if something crashes, you will not be out your entire retirement fund. One way you can do this is by purchasing several different stocks, purchase some commodities, and set up a trust fund. Once you have some money building, and then seek advice from a professional to make sure you make the correct choices. Accountants and stockbrokers are two people that can help you grow your wealth and continue to invest wisely.

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How to Cut Back on Your Food Budget in College

Posted on Jul 6, 2013 with No comments

Jul 6, 2013

As a college student, you don’t have a lot of money. Not only are you not able to work a full-time job, but the jobs you can get are likely low-paying. Add to that the fact that you are likely living on student loans and you need to find every way you can to make your money stretch.

It’s important to eat well to stay healthy and to fuel study sessions for academic success. There are many ways that you can cut back on your food budget in college without relying on ramen noodles for dinner every night. Here are a few tips:

Live at Home


The best way to cut back on your food budget is to get all your food for free – by living at home. If your parents will allow it, and if your school is close enough, consider living at home instead of moving into the dorm. If your parents are paying for your room and board, it will save them money. If you’re paying for it through student loans, living at home will save you a lot of debt later. Though it may cramp your style to live at home a bit longer, your wallet will thank you for it after you graduate.

Rent an Apartment


Renting an apartment with several roommates instead of living in a dorm will save you money across the board. Renting an apartment will help you to save money on your food budget by allowing you to cook all your meals at home instead of eating out or eating in the school cafeteria. You can shop at local markets, sign up for a co-op, grow a garden, or split food with your roommates in order to save money. However, just by shopping for whole ingredients to make all your meals, you’ll save money.

Cook What You Can


If you must live in a dorm, you can save money on food by cooking what you can. Few dorms are going to be equipped with a kitchen – or to have access to one – but some dorms will allow you to keep a microwave, a toaster or a hot plate in your room. If you are allowed access to these items – and a mini fridge for storing food – you can make many simple meals and snacks that can help you to save money on your meal plan.

Grow What You Can


Dorms aren’t likely to come with a patch of yard in which you can garden either. However, you can grow some many crops in containers that you put in front of a large window or on a balcony. You can grow some basic items like lettuce or herbs to help you make food that you don’t have to buy. If you can’t have even a small container garden in the space available to you, consider growing a small plot in a community garden. You’ll have more space and be able to grow more items, opening up a number of meal possibilities.

Limit Eating Out


Eating out is the number one way to spend a lot of money on your food budget. It may be tempting to grab a quick bite to eat when you are cramming for a test or to go hang out with friends for some food and fun to relieve some stress, but it’s best to limit eating out as much as possible – to eliminate it even if you can. Stick to making quick and healthy meals for yourself and to socializing with friends in other ways.

When you live on a college-student budget, you have to find every way you can to make your money stretch. These tips can help you to eat well while also cutting back on your food budget. You’ll spend less money and take on less in student debt, helping you to achieve financial independence more quickly after you graduate.

How did you make your food budget stretch when you were in college?



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College Saving Or A Life Insurance: Which Would Be A Better Option?

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Whether your kids are in their schools or doing higher studies, you must have planned for a college saving plan. Most of the people, usually opt for normal life insurance plans, but some are of the opinion that it is wiser to invest in a 529 plan. In fact, the way you save money for your children, is equally important as that of their college grades and test scores. 529 plan is an effective college saving plan which is preferred by many of the parents as well as financial advisers, these days. This plan offers a huge range of tax benefits both federal as well as state ones. It also subtracts a much lesser amount from the student's economical aid package, when compared to the other modes of saving plans.

 But then there are certain disadvantages too of the 529 plan. Those who have opted for this plan already, most likely won't be able to try out other financial plans, which their parents have planned for them or a cash value life insurance policy. These policies, unlike the 529 plan, don't offer state tax incentives. But one positive aspect about them is they pose very less restrictions on the distribution policies. These policies also offer a scope to the families to keep funds from the federal economical support methodology.
Well, there are pros and cons to both of the policies, mentioned above; let's take a look at a comparative study between the two.
·      Flexibility - As per the norms of International Revenue Service, money that is kept under a 529 college savings plan, can only be utilized for qualified education expenses. These include fees, books, tuition, board and room at any accredited U.S. school. If your child opt for an unaccredited or foreign school, opt out to join college or receive a full scholarship, the 529 funds can be transferred to another beneficiary. Or else, you can also pull out the funds and pay income tax on withdrawal. On the other hand, the cash that you get from the life insurance, can be used purposes according to your requirement. A student can use this for college expenses, to start a business, for making the down payment of your home or for retirement.
·      Financial aid - One of the major advantages of the cash value policy for college savings is that the money in the insurance plan, won't decrease the total financial aid that you are supposed to receive. In a 529 college saving plan, the money can be subtracted 5.6 cents in terms of every dollars that is kept in the account. On the other hand, the cash value of the policies are secured from the formula of the federal finance. What actually happens is, taking a credit against your life insurance policy, won't count against any financial aid, but will reduce the death benefit. Cashing out an entire policy will be counted as income and it can even help reduce your aid package up to 47% and could involve surrender charges.

·      Risks involved - When it comes to consider the amount of risk, involved with each process, 529 college saving plans fluctuate rapidly with the changing market conditions. You can also use a relevant life calculator in order to compare the features of both types of policy. 
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