Category: Education

Can You Afford That Student Loan?

Most parents want their children to achieve at least a four-year bachelor’s degree from college. Partly it’s emotional: “My kid graduated from Stanford. What about yours?” But the bigger driver is more commonly the fear that without a college degree, their son or daughter will simply be unable to compete for the higher-paying jobs of…
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OK To Tap Your 401(k) For College Expenses?

When it comes to their children, many parents take the view that supporting their kids is first priority.  That’s admirable from a family standpoint, but may not be optimal from a financial one.  And nowhere does this have bigger consequences than with college expenses.  A common question I encounter is whether or not it’s possible to…
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Dealing With Student Debt

As of the third quarter of 2015, student debt in the U.S. has soared to nearly $1.25 trillion. That’s trillion with a “t.”  As little as ten years ago it was only $350 billion, less than half the amount of credit card debt held by consumers.  Today it’s 70% higher.  Why is this happening and…
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How to Maximize College Financial Aid With 529s

Last year I wrote about a strategy involving 529 plans designed to maximize the financial aid a college student could receive (see https://www.cognizantwealth.com/2014/03/10/best-place-to-hold-your-529-plan/).   To summarize the original strategy: if you split your savings into two 529 plans, 75% in one owned by the student’s parent and 25% in one owned by the student’s grandparent, you…
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Use Retirement Accounts To Pay For College?

When it comes to saving for college, most people think about setting up a 529 College Savings Account.  However, you can also use individual retirement accounts (traditional IRA or Roth IRA) as well as 401(k) plans to pay for most college expenses.  But you have to make sure to follow the rules carefully; otherwise you…
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Best Place to Hold Your 529 Plan

If you have a child, chances are someone in your family has set up a 529 college savings plan for him or her.  Most of the thinking involved in setting up a 529 plan revolves around which state’s plan to utilize.  Less thought is generally given as to who should own the plan, and the…
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