What Is The Coverdell Education Savings Account (ESA)
One of new products that came out of the Budget Reconciliation Act of 1996 is the Coverdell ESA. The Coverdell ESA offers the potential for tax-free growth when you use the account to fund a child's qualified higher education expenses.
Gift Tax Fundamentals
The federal government imposes a substantial tax on gifts of money or property above certain levels. Without such a tax someone with a sizable estate could give away a large portion of their property before death and escape death taxes altogether. For this reason, the gift tax acts more or less as a backstop to the estate tax. And yet, few people actually pay a gift tax during their lifetime. A gift program can substantially reduce overall transfer taxes; however, it requires good planning and a commitment to proceed with the gifts.
Deferred Compensation
In addition to providing qualified plans to employees, many business owners implement nonqualified alternatives in order to supplement retirement benefits. These selective benefit plans are generally offered to key employees and owners. One popular nonqualified benefit is deferred compensation.
What Is Permanent Life Insurance
Once you have determined that you need life insurance, and calculated how much coverage you require, you will have to choose between several types of life insurance. There are two very different types of life insurance contracts -- term and permanent.
Financial Aid For College Students
Even if you have not been able to save all the money you will need for college, several alternatives exist to assist you in making up the difference.
Financial aid comes in many shapes and sizes -- from scholarships and grants which do not need to be repaid, to federal loans which carry very favorable interest rates and terms. The following are a few of the most popular sources of financial assistance:
Minimum Retirement Plan Distributions
Most qualified retirement plans offer significant tax benefits for those willing to follow a few IRS specified rules. The government wants to make these plans (401(k)s, Keoghs, SEPs and traditional IRAs) available for specific needs, and has established tax law to help eliminate potential abuses of these tax advantaged investment alternatives.
Selling Your Home
Once you have decided to try to sell your home, the next big decision you will face is whether you want to sell it yourself of go through a real estate broker. The broker usually charges 5% to 7% of the selling price for her services. However, realtors know the local market, can help you determine a reasonable selling price, and save you a lot of the hassle involved if you sell it yourself.
Bridging The Gap
In years past, it was often realistic for retirees to base the majority of their retirement income on Social Security benefits and traditional employer sponsored pension benefits.
Unfortunately, Social Security retirement benefits have gradually been reduced in real terms, and the age one needs to attain in order to qualify for retirement benefits has been increasing steadily. iven current retirement trends, these retirement benefits will continue to be more and more difficult for the government to fund.
