Seven Things You Didn’t Know About 529 College Savings

Most 529 Twitter Party

 

When your children are young, your top priorities are getting dinner on the table, scrubbing grass stains out of baseball jerseys, and remembering to take the trash can to the curb (because smelling those diapers for another week is NOT an option).  It seems like a lifetime will pass before they make it to college, and figuring out how to pay for it is the last item on your to do list.  Then, in what feels like the blink of an eye, you’re filling out college applications and financial aid paperwork.

Missouri (along with many other states) offers a 529 plan to help you get a jump start on your college savings.  A MOST 529 plan can be set up in as little as 10 minutes and provides some pretty awesome benefits to both the account holder and beneficiary.

  • It’s FREE to open!  That’s right- there are no fees to create your MOST 529 account.  You can easily open one online here:  Open a MOST 529 Account. 
  • Even though your account is state specific, the benefits can be used at any eligible university or college in the United States or abroad.
  • If you’re an account owner and you live in Missouri, you can deduct up to
    $8,000 ($16,000 if you’re married filing jointly) of your MOST 529 Plan
    contributions when you file you state income taxes.
  • You can contribute up to $14,000 ($28,000 if married filing jointly) per year without triggering federal gift tax. You can contribute up to $325,000 total with a MOST 529 plan!
  • A 529 plan isn’t just used for 4-year degrees.  It can be used to pay for any eligible 2 or 4 year college, vocational or trade school, or even postgraduate studies.  This can also be used on some housing, textbook, and even computer costs!
  • You can set an account up for virtually anyone that has a valid social security number: children, cousins, grandchildren, nieces and nephews, or even yourself!
  • Qualified withdrawals are tax free, too! If the original beneficiary decides not to continue their education, you can transfer the benefits (with no penalty)  or withdraw the balance (penalties and taxes will be assessed upon withdrawal).

On Wednesday, May 25th  at 1:00 p.m. CST,  we’ll be co-hosting a Twitter Party with experts on the MOST 529 plan.  You can follow me on Twitter HERE or with the handle @SensibleFamily   We’ll be using the hashtag #MOSave4College and will be giving away some great prizes!

Sling Offers Streaming Cable Channels with NO Contract- and a Free Amazon Fire TV Stick!

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I’ve been waiting quite a while for Sling TV to be released to the public and they sure came in with a BANG!

Sling TV is a streaming service that gives you access to channels such as ESPN, TNT, HGTV, the Food Network, and more!  The basic service is $20/month (for the channels shown above), with no contract or credit check.  The billing is similar to any other streaming service.  They are also adding AMC in the next few weeks!

You can also add packages with additional channels for $5/month.  Packages are in categories, such as kids, cooking, sports, or news.

It also allows you to watch any show that’s aired over the past three days- not just live episodes.

They are offering a FREE Fire TV stick or $50 off of Amazon Fire TV if you prepay for 3 months ($60).  Sign up here and you will receive a promotional code to redeem on Amazon.  The Fire TV stick retails for $39 and we absolutely LOVE ours.  It allows stream Youtube, Amazon Prime Video, and Netflix straight to your TV- and now Sling TV.  Check out Amazon Fire TV Stick to learn more about what it can do.

If you’ve got a sports nut, Disney fan, or love HGTV, you can ditch the cable!

CLICK HERE TO LEARN MORE

Obi VoIP Telephone Adapter: $29.99 (was $59.99)

You’ve probably heard me rave about this product, but may not have tried it out for yourself.  We purchased an OBi100 VoIP Telephone Adapter and Voice Service Bridge a few months back and have cut our phone/internet bill by 80%. 

The OBi is a jack that plugs directly into your router.  You can choose to port your old number over or use a new one.  We went with a new one through Google Talk.  I was so tired of telemarketers calling! 

All you pay is the initial cost for the device- simply plug in any phone you have.  You’ll receive free caller ID, unlimited long distance, call waiting, call forwarding, three way calling,  and many other features.  My favorite feature when using with Google Talk is that they will email me a text version of every voicemail left, so I don’t have to worry about listening to them.  I can also forward calls to my cell phone, or set them both to ring at the same time.

I use this for a home and business phone, as you can set up two numbers. 

You have very little to lose by trying it- we kept our landline on for a couple of months to make sure we liked it.  That was wasted money!

Amazon has the Obi100 on sale for just $29.99 today when you enter the coupon code TALK2DAD at checkout.  This little gadget is saving us over $900 per year!

How We Saved $90 Per Month on Telephone Service: Obihai OBI100 VoIP: $29.99

Obihai OBI100 VoIP Telephone Adapter with Google Voice & SIP

The Obi is the cheapest way to get great phone service off of your broadband connection.  We still use a landline telephone for business calls and as an emergency line for the kids.  The Obi requires a one-time purchase of the adapter, and will hook into your router and use any landline phone!  You can port your existing number or sign up for a free VoIP service such as Google Voice.  You’ll have all of the features of a landline phone, along with FREE long distance. 

This also has the ability to run two phone lines- perfect for home businesses!

NewEgg has the Obihai OBI100 VoIP Telephone Adapter with Google Voice & SIP on sale for just $29.99 with the coupon code: EMCXSXL53 

CLICK HERE TO SAVE UP TO $1,080 PER YEAR

You’ll receive free two-day shipping if you’re a Shop Runner member!  (Shop Runner offers free two-day shipping from dozens of retailers.  You may qualify for a free 30-day trial.  Sign up through Ebates and receive $5.20 in cash back for joining).

Tools to Help You Budget in 2013

New year, new budget!  For many, the new year brings a fresh start to managing your finances.  Budgeting is one of the most popular resolutions made.

There are many tools available to help you meet your financial goals, so many that it can be overwhelming. 

I’d like to share a couple of tools with you that I personally use (and have used for quite some time).

1.  Credit Sesame:  This service provides you with an instant view of your credit report and score.  It also sends you email notifications if the score changes so that you can stay on top of things.

This free service was developed at Stanford University and even includes tools to help lower your debt. 

2.  ManillaManilla is a free service that allows you to manage everything in one place.  You can track all of your accounts, utilities, loyalty cards, subscriptions, rewards cards, and more. 

You can elect to receive text and/or email reminders when a bill is due, subscription is expiring, and other financial changes.

3.  Budget and Bills Printable Planner:  As techie as I am, I still prefer writing important things down on paper.  It helps me remember easier, I can see the whole picture, and it’s always accessible.  This printable set is my favorite!

Both of these have made my hectic life MUCH easier!  They are both secure and extremely safe to use.

ING Direct Financial Independence Day | Earn up to $205 in FREE Money!

Just last week we talked about our savings account at ING Direct and how it helped us save enough to pay HALF down on our home in just a few years. 

One of my favorite perks of ING Direct is their incentive program.  Each year during July 4th and Black Friday, they offer some amazing incentives that provide you with FREE money. 

ABSOLUTELY FREE Kid’s Bonus

If you open a Kids Savings account (with NO initial deposit), today or tomorrow, you’ll receive a $17.76 bonus in each account.  You’ll start earning interest on the bonus immediately, and your funds will be available for withdrawal after 30 days.   The only stipulations are that you or the child must be a new customer to ING Direct and the child must be under 18 years old.  It’s really that easy.

How to get this bonus:

1.  Set up an ING Direct account via this link:  KIDS Savings Account Bonus

2.  Select ‘Open a Kids’ Savings Account’.

3.  That’s IT!

4.  I do recommend you set up a regular deposit of at least $1- it will definitely add up to help pay for those unexpected expenses. (Tip:  If you start adding $10 per week when your child is a baby, you’ll have $10,000 saved when they turn 18).

EARN $152 FOR SETTING UP A CHECKING ACCOUNT

If you open an Electric Orange Checking account through July 3rd and make a total of 5 purchases within 45 days, you’ll receive a $76 bonus on August 22nd.  You can earn an additional $76 if you set up direct deposit and have at least two deposits of $250 posted to your account by August 31st.  The additional bonus will be deposited on September 10th.

Note from Alicia:  I really encourage you to try this program.  You can set up countless free savings account with automatic deposits for whatever you would like to save for.  There is no penalty for transferring balances.  It’s a good interest earning alternative for cash-only budgeting.  My current accounts are labeled: Emergency, Savings, Ethan, Katie, Christmas, Vacation, Automotive, and Home Repair.  Even $1 a week per account can add up!

How Anyone Can Afford to Start a Savings Account | And a Challenge for You!

A reader sent me a link to this article at CNN Money this morning, regarding the startling number of Americans that do not have adequate (or any) savings account.  Here is my favorite quote from the article:

"The biggest barrier to saving is not being in the habit of saving," he said. "By establishing that habit, even if an unplanned expense comes up and wipes out what you’ve accumulated, you’re only one paycheck away from restarting the saving process."

We used to have a really difficult time saving any money.  It wasn’t because we didn’t have a little extra, it was because it was not easy to save with our bank.  They didn’t offer any automatic savings programs.  In order to put money into the savings account, I had to go to the bank itself to do it.  I don’t like going to the bank, and when I did, it always slipped my mind.

When I started looking into additional banks, I ran across ING Direct.  I was leery of using an online bank, but they are one of the highest rated AND offered much higher interest. 

With ING Direct, you can set up as many savings accounts as you’d like- for FREE! I quickly set up accounts labeled: Christmas, General Savings, Home Down Payment, Emergency, and one for each of the kids.  I decided a small amount of money that we could put forward each week and set up the automatic transfers.  I can transfer money between the accounts at no charge.

A couple of weeks after the cash started coming out, I realized that I didn’t notice it was missing!  I can still get it out if I choose, but when I see the sum of all accounts, I don’t want to spend any of it.

Here’s how easy it is to set up an account:

 

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After saving for just over two years, we used our ING Savings Account to pay for nearly HALF of our house in cash.  I honestly think that we never could have done it if we hadn’t started using ING Direct as our savings account.

Here’s my challenge to you:  Pick something you REALLY want to save for.  Set up an ING Direct savings account and start putting a small bit aside for it.  You can set one of these up with as little as $1 a month (but that’s going to take a while to add up!).  This can be something as small as a new pair of shoes or as big as a house!

Once you sign up, leave a comment below telling us what you’re saving for!  One lucky winner will receive a $10 contribution to their savings!

Sign up for DailyWorth for some great financial, investing, and entrepreneurship advice

DailyWorth is a service that helps women better understand their finances.  They have an online community and also send out regular emails full of information.

You can change the frequency of your emails.  I get a summary twice a week.  These are full of information on everything from taxes, investing, entrepreneurship, saving, and even self worth tips. 

It’s definitely worth checking out.  I find a ton of original, useful information with DailyWorth.

Income Taxes: Free Filing + Money Saving Tips

I’ll admit it, I actually like taxes. In fact, I love them. If I didn’t, I wouldn’t have completed thousands of returns in the past 10 years. While I can do nothing to change the amount of your return, I can offer you several tips on how to save on your preparation fees and maximize your refund.

  1. DO IT YOURSELF That’s right, yourself. Taxes are not difficult, just basic data entry. Very few returns require additional knowledge, and almost everyone will fall into the basic category. A basic return will contain one or more of the following: W-2, 1099, education credits, Earned Income Credit (EIC), and Child Tax Credit.
  2. YOU DO NOT HAVE TO PURCHASE EXPENSIVE SOFTWARE TO COMPLETE YOUR TAXES I have recommended www.taxact.com to hundreds of people that would like to attempt self-preparation. This is one of the easiest to navigate sites I’ve seen. TaxAct has a downloadable and a web version. I personally use the web version. The best thing about TaxAct? It’s FREE!! There are packages that require a fee, but those are not necessary to complete your return. The only cost you will pay is to file your state return (if your state still charges a fee), as you would with any software.

    With purchased software such as Turbo Tax, you not only have to pay the initial cost of the software, you will have to pay to file your federal and state returns.

  3. TAKE ADVANTAGE OF STATE PROGRAMS. There are many programs set up by the state to help individuals with tax preparation at no charge. There are different programs set up for low-income, senior citizens, and disabled persons. Check with the local colleges and Social Security Administration for a list of participating locations.
  4. IF YOU CHOOSE NOT TO SELF-PREPARE, SEEK OUT A CPA A CPA will charge as much as 80% less than a franchised tax preparation service. The average CPA return will cost you around $60-$80, while a return completed by the ‘People’ begins at $180 for a single person with no dependents and one W-2. The average cost of returns filed by the ‘People’ is $290.
  5. PAY FOR YOUR RETURN UPFRONT So many people have told me that they choose franchised operations because they simply cannot afford the $60 to file a return with a certified accountant. If you cannot afford the $60, how can you possibly afford to lose the $200-$300 by filing somewhere else?
  6. DO NOT FALL FOR THE INSTANT REFUND GIMICKS If you file with direct deposit, it should take 10-14 days to receive your refund. There is a schedule that can be found at www.irs.gov that will tell you what day to expect your refund based on your filing date. An instant refund will charge you an upwards of 400% in interest. The average amount deducted from an instant refund (including filing fees) is around $800. An instant refund can take from 1-4 days to receive.
  7. IF YOU ARE A SENIOR OR DISABLED, CHECK OUT THE NEW PROPERTY TAX CREDIT GUIDELINES. Even if you’ve never qualified for PTC before, check into it this year. The State of Missouri has raised the maximum income tremendously this year. I believe the cap is now $30,000. Even if you do not need to file a regular return, you can file a PTC. This will entitle you to a refund of up to $400 of your property taxes. More information is available on the Missouri Department of Revenue website.
  8. REPORT THE AMOUNT OF YOUR STIMULUS PAYMENT. The payment that was received last summer was based upon an estimate of your 2008 earnings. If your earnings have changed, it is quite possible that you may qualify this year. It is also possible that you may have to return a portion of the payment. If you do not remember the exact amount of your check, you can view the information at www.irs.gov.
  9. KEEP RECEIPTS FOR ALL DONATED ITEMS. With your newfound couponing and shopping skills, chances are that you have made some donations. Make sure you obtain a receipt for all items donated. Many times the receipt will be for the value of the item, not the purchase price. This can really help reduce taxable income, if applicable.

Information to note:

-No specific tax program will give you a higher refund. All programs should figure the taxes identically. If you try different programs, or even go to an accountant or tax preparer and you have a different refund amount, there is a mistake somewhere. So many people think that Turbo Tax can get them a higher refund or that H&R Block can do better. If you are getting a higher refund from one place, you really need to double check it. If identical information is input, you should have identical refunds.

-Individual situations can differ, so if you have any questions at all about self-preparation, check out ‘Publication 17? which is issued by the IRS. You can pick up a hard copy of the book for free at the Post Office, and it is also viewable online. Please do not take any advice from someone who is not a qualified professional. The most problems that I have seen occur from the ‘he said, she said’ chain of communication.

-Please remember that the majority of employees (not all) at the franchised tax preparers undergo a weekend training course. There are a couple of great preparers at each office, but many are seasonal employees with absolutely no education or previous experience.