Happy 529 Day!

529 #2Dear Mr. Market:

Today is the last day in May and although you’re still positive for the month you look like you’re limping home. School is wrapping up for the year so perhaps you have a bad case of “senioritis” or “summer fever”.  Are you getting tired Mr. Market? It sure looks like it. Speaking of being a student, today also is May 29th, and it marks the sixth annual national 529 Day. With that being said, let’s review why a student needs you (the market and a good platform) to ultimately get to their “finish line”.

Whether you are a parent or grandparent it’s likely been a long time since you’ve been in college. Even if you stay close to the numbers of what it costs to send a child to college, you’re likely to be blown away when it actually comes time to write that first tuition check. For the 2014-2015 academic year the College Board surveys reported that in-state college budgets averaged $23,410/year and private college averaged $46,272. Before we go into how you’re going to help pay for these types of college costs let us share with you the two reasons you should NOT use a 529 College Savings Plan. Continue reading

Who is the ‘Fed’ and what do they do?!

Fed Reserve CartoonDear Mr. Market:

“Who and what is the Fed”?  “What do they do” and “How do I understand what they are really saying and how it will impact me!?”  These are questions that we often hear from investors.  The Federal Reserve frequently dominates economic headlines and although its actions impact us all, very few of us truly understand what “the Fed” is or what it does.

We all hear terms like: “Don’t bet against the Fed”, “Dovish or hawkish sentiment” “Quantitative Easing” and “When will the Fed begin to taper”?  These are just the tip of the iceberg as the press and media attempt to interpret anything and everything released by members of the Fed.  Let’s take a moment and look at the basics of what the Fed is.

The Federal Reserve System (the “Fed”) is essentially the central banking system of the United States.  Through the Federal Reserve Act of 1913 it was created in response to financial uncertainties in the early 1900’s.  Over the last century the responsibilities and roles of the Federal Reserve System have evolved to address the changes in our economy. Continue reading

ABC’s of Investing in a 529 College Savings Plan

Unknown-6Dear Mr. Market:

Most of the time that we write to you it’s about your temper or volatile behavior and how that affects the average investor. Sometimes, however, it might be good for us to refresh our memory on “why” we invest and put up with all your ups and downs! Most investors certainly don’t watch you just for chuckles ; ideally we all have a purpose and reason to put up with all of your unpredictability and potential promise. With that being said, we would like to review some basic information as well as the pros and cons of saving for college via 529 College Savings Plans.

First and foremost let’s not waste too much time on stating the obvious: College and all the costs that come with it are more expensive than they ever have been. That trend is not reversing anytime soon so if you’re a parent or a grandparent trying to prepare and plan for the future, you need to consider the enormous price tag most universities are charging. Are you sitting down? The average private college tuition in 18 years from now will cost north of $130,000…per year! OK…how about the more reasonable route of going to a public state school? That price tag is estimated to be about Continue reading