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Coverdell Savings Accounts
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Utah 529 College Savings Plans
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Are We Entering a Recession, You Need to Act Now!
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If It Makes You Feel Any Better, Harvard’s Portfolio Lost Big, Too
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The Power of Compounding

Coverdell Savings Accounts

Unlike 529 plans, the rules governing Coverdell Savings Accounts are dictated by the IRS. Thus, there is no variation in these plans from state to state.

Contributions to Coverdell accounts are not deductible on either a federal or state income tax return. However, similar to 529 plans, earnings withdrawn from these accounts are tax-free if used to cover qualified education expenses. Also similar to 529 plans, funds withdrawn that are not utilized for education expenses are taxed as ordinary income and subject to a 10 percent penalty.

Coverdell accounts offer several advantages over 529 plans. First, the definition of qualified …

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Utah 529 College Savings Plans

Utah 529 College Savings Account

Utah offers one of the most attractive 529 plans in the country. Like all 529 plans, contributions to a Utah 529 plan are not deductible on a federal income tax return. However, the State of Utah will allow the contributor to claim a 5 percent tax credit on up to $1,650 per beneficiary if the contributor is single, or $3,300 if the contributor is married filling jointly. A tax credit is a dollar-per-dollar reduction of a tax liability, and is thus more valuable than a tax deduction. Consequently, the state will pay as much as $82.50 of a single contributor’s …

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Are We Entering a Recession, You Need to Act Now!

009 - Recession Act Now CartoonWe’re facing unprecedented times in our economy. The government is in the midst of a $700 billion bailout. The stock market has plummeted and we are in the middle of a housing market meltdown. Unemployment is increasing as well as gas prices (depending on the day). Now that the elections are over the media says we are entering a recession. If you’ve been following the news you already know we’re facing difficult economic conditions and it may seem as if the end is near.

Daily I’m asked about the economy and at least weekly I receive a media inquiry asking …

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If It Makes You Feel Any Better, Harvard’s Portfolio Lost Big, Too

A comment that I’ve heard several times in the last few weeks is, “I took a look at my 401(k)/mutual fund statement and it was really depressing.” Well, take heart: at least you’re not down by eight billion dollars….

Various sources are reporting today that Harvard University’s endowment has experienced investment losses estimated at 22% since June 30, the end of the school’s fiscal year.  Since the portfolio was at almost $37 billion then, that translates to a loss of about $8 billion.  The Associated Press and other sources are reporting that Harvard President Drew Gilpin Faust has broken the

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The Power of Compounding

Image by: KRHamm

Image by: KRHamm

Remember all the time we spent as children dreaming about what it would be like to be a millionaire? Surprisingly, if we had spent that same amount of time running a candy store or a lemonade stand, we would all be on track. Why didn’t anyone tell us it was so easy! Of course, many adults don’t comprehend the power of compound interest, so I suppose we should give ourselves a bit of a break, but here is the secret: assuming historical investment rates of return hold steady, a 10-year old would need to invest only $25.52 …

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