If you have kids and are headed for divorce, one of the most difficult negotiations maybe agreeing on how your children’s college tuition will be handled. We have seen this issue come up over and over again in divorces, and it is best to get as much clarity during the negotiation process as possible.
A college education has come to be thought of as something every child in America is entitled to, and something that every parent wants to provide. Seeing your child go to college is almost as much a part of the “American Dream” as owning your own home. But with college costs rising far faster than general inflation, a 4-year education at a pricey private school can easily exceed a quarter of a million dollars. And even 4 years at an in-state public school can easily exceed $100,000 per child.
College students and their parents dodged a major bullet with the Tax Cuts and Jobs Act of 2017. Initial drafts of the bill included the elimination of Coverdell Education Savings Accounts, the Lifetime Learning Credit, and the student loan interest deduction, along with the taxation of tuition waivers, which are used primarily by graduate students and college employees. In the end, none of these provisions made it into the final legislation. But a few other college-related items did. These changes take effect in 2018.
Over the last 20 years, many people have used 529 plans as a way to save for their children’s or grandchildren’s college education on a tax advantaged basis. Basically, if you put money into a 529 plan and invest it, you can reap the benefit of the growth on the money in the plan tax-free if it is used to pay for qualified higher education expenses for the beneficiary of the 529 account. Those expenses typically include college tuition, room and board, books, computers, software, and other items.
With some private colleges now crossing the once unthinkable $70,000-per-year mark in the 2017/2018 school year, and higher costs at public colleges, too, financial aid is essential for many families. How much do you know about this important piece of the college financing puzzle? Consider these financial aid myths.
College is a huge financial undertaking. With costs increasing every year and the prospect of too much student debt at the forefront of many families’ minds, it’s more important than ever to be an educated college consumer. Go into the planning process wisely with these four steps.
Atlanta Financial Associates, LLC (“Atlanta Financial”) is a registered investment adviser offering advisory services in the states of Alabama, California, Florida, Georgia, Louisiana, Maryland, Mississippi, North Carolina, South Carolina, Tennessee and Texas and in other jurisdictions where exempted. Registration does not imply a certain level of skill or training. The presence of this website on the Internet shall not be directly or indirectly interpreted as a solicitation of investment advisory services to persons of another jurisdiction unless otherwise permitted by statute. Follow-up or individualized responses to consumers in a particular state by Atlanta Financial in the rendering of personalized investment advice for compensation shall not be made without our first complying with jurisdiction requirements or pursuant an applicable state exemption.
All written content on this site is for information purposes only. Opinions expressed herein are solely those of Atlanta Financial, unless otherwise specifically cited. Material presented is believed to be from reliable sources and no representations are made by our firm as to another parties’ informational accuracy or completeness. All information or ideas provided should be discussed in detail with an advisor, accountant or legal counsel prior to implementation. All investing involves risk, including the potential for loss of principal. There is no guarantee that any investment plan or strategy will be successful.
