The Real Scoop On College Planning

An article of 748 words describing the different savings plans available for children and education.
You have probably heard all about the new 529 college plans. Well, the plans are not all that new but they have gained a lot of momentum in the last couple of years. In this article I will review the different types of college plans and how they can work for your investment needs.

Prepaid tuition plans fall under the 529-tax code, however they are a first generation type plan. The idea is that you pay the tuition at todays rate for future use. The money is invested by the state, thereby guaranteeing the tuition at a participating college. Something to look out for in this plan is that the tuition must be used at a school within the state that you invested in and it must be used exclusively for tuition or you can pay a penalty. Also there is no professional money management in these plans that are run by the state governments. The major benefit of this plan is the guarantee of the tuition money when redeemed.

Section 529 college plans, (so named by the IRS code they represent) got a big boost from the recent tax law changes. In a nutshell, the money inside these plans grows completely tax-free and is tax exempt upon withdrawal if used for college related costs. These college costs are tuition, books, room and board, or any other college related expense.

The 529 plans are very flexible: * There are no income limits on the plan * Anyone can open one and make low monthly contributions * Monies can be moved from one beneficiary to another * It is an excellent estate planning tool * The money can be used for public or private schools, also 2-year technical schools * They can be used in any state and some foreign institutions * Monies in a 529 plan will not affect financial aid as much as educational savings account

Thoughts to keep in mind: * The Federal law governing the withdrawals from these plans will expire in 2011, so there may or may not be some changes involved here * Unqualified expenses will have a 10% IRS penalty and some states also charge a penalty.

Education Savings Accounts, which were the Educational IRAs of the past, have been positively affected by the new tax law changes. Currently the yearly contribution is $2000 per year. You can contribute and establish an account on behalf of any beneficiary under the age of 18. The funds can be withdrawn tax-free to pay for all qualified educational expenses at primary and secondary schools, colleges and universities. In an ESA you have complete control over the investments in the account. Any funds remaining in the account when the beneficiary reaches the age of 30 are redeemable by the beneficiary minus taxes and penalties unless they are rolled over to the account of an eligible family member. These accounts are off limits to investors whose single income is more than $110,000 or married couples earning more than $220,000.

UGMA/UTMA Accounts offer fewer tax benefits than the newer savings plans. When the beneficiary reaches the age of majority they have full access to the money, whether it is used to pay for college or a hot new sports car with all the extras! These accounts allow you to invest as much as you like, how and where you elect to invest but without gift-tax incentives. For a child under the age of 14, the first $750 of annual investment is at the childs tax rate, income above $1,500 is taxed at the parents tax rate. All income for a child 14 or older is taxed at the childs rate.

There are many options available to parents today for college savings. The most important one is to begin as early as possible and to continue to invest for as long as necessary. The one thing we all know as parents is that the fastest 18 years of your life happens from the day your child is born to the day they start college. A person who sets aside $2000 per year in an ESA or 529 plan, and earns 10% per year on that money, will have:

* $13,341 at the end of 5 years * $35,062 at the end of 10 years * $69,899 at the end of 15 years * $100,318 at the end of 18 years.

The sooner you can get started, the easier it will be to make the dream of college a reality.

About the Author

Cindy Diccianni is a Registered Nurse, a Certified Senior Advisor (CSA), a Registered Investment Advisor and a Registered Representative with Leigh Baldwin & Company member NASD and SIPC. She is affiliated with Ortner, OBrien & Ortner Advisory Group, Inc. and co-founder of Nurturing Your Success, Inc. Her passion is assisting clients in creating the financial freedom they dream of. Visit Cindy at www.nurturingyoursuccess.com, write to her at Cindy@nurturingyoursuccess.com or call her directly at (610) 251-9393 x206.

This article briefly describes rough road ahead when you want to become model.
Perhaps Naomi Campbell was discovered strolling through London's Covent Garden in her school uniform, Kate Moss discovered walking through Kennedy Airport, and Laetitia Casta at age 15 whilst walking on a beach in Corsica. Even Tyson Beckford was whisked away from a life of gang-banging by a hip-hop magazine editor -- but these cases aren't typical. The world of modeling is quite harsh on the ego and if one doesn't have their head screwed tightly on their shoulders and their skeptical lenses on, it can be quite costly as well. If guys and gals think that they're hot, just give them a moment with a modeling scout that will break down every tiny little physical flaw that they possess, and that "I'm so hot, you're lucky to be around me" attitude will do a quick 180.

benjamin's not here

If a scout approaches you at the local mall, watering hole or strip joint to tell you that you may have what it takes to be a model, take those words with a grain of salt. Hey, it's possible that the agent isn't kidding, but more often than not, they want to discover you in "other" ways.

Becoming a model shouldn't require a professional $1000 portfolio or a "getting started" fee, so when a scout begins asking for an arm and a leg, give them a taste of your shoe size instead.

hey new york, i'm here

What you should do instead is take that $1000 dollars and head off to New York where all the major scouts are. But before heading out, you need to ask yourself a couple of questions. Are you striking? Not good-looking, because if you think that you could be a model, then it's likely that your friends (or the women you date) have already mentioned that you're better than average-looking. Burt, when you walk down a street, do people stare at you in an awe-stricken manner?

As well, are you tall, fit and confident? Because if you lack any of these qualities, then your chances just lessened by about 80%. You have to stand tall, take care of your physical appearance and prepare yourself to get knocked by a lot of professionals in the business. That's the price you have to pay if you want to excel in the modeling business.

You may hear things like, "your earlobes aren't even, your face is lopsided, get your teeth fixed, your hairline is receding, your butt's too flat, your stomach's too flabby, lose ten pounds," and "don't call us, we'll call you." So hope for the best, but prepare for the worst because these "magical discovery" stories don't happen too often.

About the Author

Ajay Patole is a qualified management professional working as sales manager and runs a site 'Venturemall',a cool hangout to play money games,buy and sell in auctions,date and photochat.It is available at URL http://venturemall.tripod.com and newsletter to rediscover true colors of life at http://www.topica.com/lists/venturemall.Also he runs a community 'Venturecon', for entrepreneurs which is available at URL http://groups.msn.com/venturecon.