College Savings Accounts
The summer has arrived, and you're finished studies for now. But the imperative of saving for college is not stowed with books.
Investment funds and funds listed have become basic tools to generate tens of thousands of dollars needed to pay for college. Investing, as with studying, may seem like an examination, but we don't need to be a genius to understand it. Take the test:
1. We apologize for the turmoil that this question can cause, but how much it will cost cree a college education to someone who graduated from high school this spring?
A. $ 50.000
B. $ 60.000
C. $ 100.000
D. $ 375.000
Answer: C. For many people are too many zeros, but we can not evade the reality. It is estimated from Fidelity Investments based on the average cost of a career of four years according to data from the College Board. But note that since it is an average cost of studies at all universities, their education could cost much less or more.
2. True or false: People who have a savings plan for college, known as "Plan 529", the plan must invest in the state where they reside.
Answer: False. You can invest in any plan, although it can gain extra tax if invested in the plan of their state. But it is worthwhile to participate in the plan to invest more funds.
3.Verdadero or false: A problem of 529 plans is that parents do not control them if the student does not attend college.
Answer: False. This is one of the myths of 529, according to Fidelity Investments. In this situation, the account holder, typically a parent, you can change your beneficiary to another family member, even the account holder. But if funds are not used for approved educational costs, they fall under federal tax of 10% as sanction.
4. There are other ways to save for college. What kind of investment is used more often for college savings?
A. Shares of Internet
B. Gold
C. Silver
D. Bonds exempt from taxation
Answer: D. It goes without having a college education to know that bonds are exempt from taxation aid to save for college.
5. Family members can donate to a 529 plan or a Coverdell account?
A. No, runs counter to the tax laws
B. Yes, whenever they want
C. Sometimes
D. Only in New York State
Answer: C. Many 529 plans and Coverdell accounts accept donations from their families and other individuals, but some 529 plans, for example in New York, only accept contributions of the account holder. See the details with his plan.
6. If your child is sufficiently ready to receive a scholarship importantly, all this could be less compelling. What the experts advise if your child does not get a scholarship?
A. Negotiate
B. Sue
C. Treat at another university
Answer: A. Experts advise to leave the timidity and negotiate with the financial aid office of the university, depending on the school could get more than they cree.
Financial aid, grants federal programs that allow work at the university to pay less for classes and the like can be a great help. To get any kind of help, your child must complete an application for Federal Financial Aid, commonly called the Fafsa form, available in Spanish at www.fafsa.ed.gov / en_US / index.
You can also borrow against the value of your home, or their 401 (k) account.
8. A few weeks ago a couple expecting a child who won $ 1 million in state lottery in New York. What iban said that to do with the money?
A. To pay its debts
B. Buying a bigger apartment
C. Start a savings account for college
D. All previous answers
Answer: D. Until the instant millionaires worry about college costs.
