QTIP, Sheltering Estate Taxes And You

qtipSuppose each of your clients has a will that provides that the survivor will receive property that will qualify for the marital deduction only to the extent necessary to bring down to zero the estate tax owed by the estate of the first to die. In that case, any property that does not qualify for the marital deduction will not be subject to estate tax in the estate of the survivor.

* Preventing property from qualifying for the marital deduction. Here are a few ways to prevent property from qualifying for the marital deduction.

1. Leave part of the estate to someone other than the surviving spouse. This can be done outright or in trust …

Budgeting In College: Some Tips

bicstPlanning for college is about making choices, and those choices go way beyond choosing your school. Deciding how to manage your money is a choice you’ll want to handle early and with care.

This is a lesson some students learn too late. Take Jen’s friend Jason, who lived down the hall from her at Boston College. With a new credit card in his wallet and newfound independence, Jason charged $500 worth of pizzas during the first month of school. “He used to ask everyone in our hallway if they wanted some,” Jen recalls. Now, six years later, “he’s probably still paying it off!”

If Jason had thought about a budget before getting to school, he …

Will Your Savings Run Out: A British Case Study

wysroAccording to recent research undertaken for the Department of Social Security, about half of people of working age are not making any contributions to a non-state pension at the moment. Nearly half of these were not working at the time of the interviews, but the rest were — either as employees or, less commonly, self-employed.

This, and the “ageing” of the British population, has prompted the Labour government to launch its stakeholder pension. What exactly is it? Will it appeal to people with inadequate provision for their old age? Will pension providers want to offer it? In short, will it help to combat financial and social exclusion among tomorrow’s pensioners?

The stakeholder pension is an …

Saving Your Child’s College Fund Takes Guts And Planning

You’ve heard all the bleak stories. Tuition at private universities is now so high that only the superrich and families willing to bury themselves in debt can afford it. Even parents who set their sights on a lower-cost state school can barely manage to save enough to keep pace with college-cost inflation. As they say, the hurrieder you go, the behinder you get.

Saving for your child's future isn't so simple.

Saving for your child’s future isn’t so simple.

Well, it’s time to re-evaluate. The long U.S. economic boom has made post-secondary education more affordable than it’s been in a long time, according to Diario San Diego. Jobs are plentiful, and compensation is up. And while rising college costs continue to outpace the increase in consumer prices generally, tuition inflation has cooled to a more manageable 4.5 percent–about half the pace of the early 1990s.

The stock market, meanwhile, has climbed from one record high to the next. The Standard & Poor’s 500 Index, a broad market benchmark, recorded its fifth consecutive year of extraordinary growth in 1999, and stock mutual funds that track the index have earned 17.9 percent compounded over the past 15 years. If you had managed to start investing $200 a month in a stock index fund when your child was a toddler, today your investment would be worth nearly $143,000 before taxes–about the cost of four years’ tuition, room, and board at the priciest Ivy League university today. Continue reading

Protect Yourself From Corporate ID Theft!

pyfcitCompanies gather huge volumes of personalised data from us all at the point of sale, through surveys and by buying it from other information-gatherers. Through the use of increasingly sophisticated data-matching techniques, particular pieces of information that you may have supplied to one company on an anonymous basis can be pieced back together with your personal identity by another organisation, according to Unbrand America.

Businesses use databanks of this kind to target new customers, tailor new services for existing ones and decide which Continue reading

Planning Your Pension: Be Smart And Stay Flush

pypbsDefined benefit plans — more commonly called pensions — are typically available automatically to any employee who meets the minimum requirements. Because the employer usually contributes the money to fund the plan, it is usually the administrator — not the individual employee — that is responsible for investing the funds. However, the employee may have representation through a union or through the employer on a committee that makes investment and plan structure decisions.

Unlike defined benefit plans, defined contribution plans are funded by the employee (although, in some cases, the employer contributes matching funds). Most public sector employers offer a 457 or deferred compensation plan, but they also use plans — 403 (b), 401(k) or 401(a) — from other IRS code sections. Continue reading

Couple In Profile: What We’d Do

cipwwCombined, the couple’s household income is a little more than $72,000. Andrea, a registered nurse with Meridian Medical Group in Smyrna, Georgia, has about $10,300 in savings and investments, including a Roth IRA, company 401(k) plan, savings bonds, and certificates of deposit. Andrea is disappointed her company doesn’t match her 401(k) contributions. For this reason, she is only putting $25 per paycheck toward the plan, preferring instead to contribute $50 per month to her IRA and another $50 to a mutual fund account.

Reginald has gotten off to a slower start in terms of investing. In January, he started a new job as a computer technician with Integrity In Education in Irvine, CA, and he won’t be eligible Continue reading