5 Financial Planning Tips for College

Did you know the average American college student is now graduating with $33,000 in debt? And with more than half of parents placing higher value on college savings over retirement, learning to save smart is more important than ever, says nonprofit American Consumer Credit Counseling (ACCC).

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One way to do so is with a 529 plan–an investment plan operated by a state or educational institution, with tax advantages and other incentives to make it easier to save for college for a designated beneficiary, such as a child or grandchild. Operating similar to IRA and 401(k) plans, 529 college savings plans allow parents to save for a child's education tax-free through an array of investment options.

There are two types of 529 plans: prepaid tuition plans and savings plans. The plans are named after Section 529 of the Internal Revenue Code and are administered by state agencies and organizations.

In addition to enrolling in a 529 savings plan, students and families can save for college and manage expenses during school by:

Learning to Budget Now – Developing a realistic and manageable budget is a valuable lifelong skill that is essential for anyone in college, preparing to go to college, or just graduating. Start by using a budgeting worksheet for students to get an accurate picture of your income and expenses. By comparing and contrasting your total income and expenses, you will be able to create a feasible budget plan. By sticking to your budget, you will avoid going into any unnecessary credit card debt.

Being Wary of Credit Card Debt – Credit card companies target college students because they have little experience managing their money. If you sign up for a credit card, don’t get carried away. Get your payment in by the due date or you'll be slapped with late fees and create additional debt for yourself.

Working – Consider a part-time job, tutoring, paid internships or work-study programs to earn and save money while in school. If you’re looking to get an apartment after graduation, make your student loan payments, or relocate for a job, saving for your future will help you in the long run.

Using Your Student ID for Discounts – Not only will you need it to enter your dorm, the dining hall, and the library, but your student ID can also earn you discounts at hundreds of retailers nationwide. If you are not sure if a company offers a student discount, just ask. You can also find a list of discounts at ConsumerCredit.com.

Taking Stock of Your Financial Situation – Too many students graduate from college without any idea of how much they’ll have in student loans, or how much to expect to make at their first job. Make sure you know how much school costs per year, what your parents are covering, what you’ll be expected to cover, and budget for rent and living expenses accordingly.

Source: ACCC

Reprinted with permission from RISMedia. ©2015. All rights reserved.

For Your High School Senior: Do You Need to Rethink Your First-Choice College?

Tens of thousands of high school students will be receiving their college acceptance letters in April. It’s an anxious time—students, and their parents, want to believe their school holds the promise that attendance will be their “Golden Ticket” to eventual financial success. So, if they are trying to get from “Point A” (here and now) to “Point B” (financial independence), how do they select the school that will deliver that return on their investment?

“Young people tend to quickly fall in love with a school, and parents tend to quickly wear their son’s or daughter’s acceptance as a badge of honor, or at least validation as a successful parent,’’ says David Porter, social architect, consultant to colleges and universities throughout North America and author of “The Porter Principles,” a guide to college success through social engineering, (www.porterkhouwconsulting.com).

“Students and parents should be skeptical and consider all of what a college has offer, and how it will deliver on the implicit promise of financial independence. Which school will nurture and grow the prerequisite face-to-face problem-solving skills required to secure gainful employment and financial independence upon graduation?”

According to the most recent study from the University of California, Los Angeles’s Higher Education Research Institute, only 58 percent of the surveyed 204,000 college freshmen enrolled at their first-choice college, the lowest percentage to do so since the question was first asked in 1974.

The major factors behind the decline are cost and financial aid. A 2012 study by the research group Ipsos and the student loan giant, Sallie Mae, indicates that roughly 70 percent of families are ruling out colleges based on cost.

First choice or otherwise, Porter says students and their families should consider a variety of factors in estimating the most value to be had at a campus. Some are more relevant than others:

• A school’s ranking: According to one of the world’s leading public intellects who regularly weighs in on academic issues, Malcom Gladwell, the national ranking a school receives doesn’t necessarily reflect the needs of individual students. Just like an expensive sports car is valued, in part, from an arbitrary, expensive price tag, so too are colleges. The various needs a young adult will have are by no means fully represented by the seven variables used by the U.S. News rankings, run by Robert Morse. The variables include undergraduate academic reputation, financial resources and alumni giving.

• On-Campus culture and community: In addition to academics and the rigors thereof, a college offers (or fails to offer) a unique on-campus college experience. Will the environment foster success (post-graduate financial independence) or, will it essentially be a few more years of high school under the guise of “college”? Look for safe, wholesome campus venues, like a student union or a next generation dining learning commons that invites student interaction, collaboration, problem-solving, and dining 24/7. Social architecture—the conscious design of an environment to encourage social behaviors that lead toward a goal—is a ground-breaking approach that social architecture visionary Porter is successfully introducing to more campuses across North America every day.

• Parent-student understanding: Move out and stay out (because you can). Mom and dad, we want a nice home, a nice car, nice vacations, nice stuff, nice meals, etc. etc. etc. It costs tens of thousands of dollars per year to attend most colleges. Whether or not a student assumes massive debt to follow her dreams, or a parent shares the burden should be moot if the student can identify, pursue and secure gainful employment upon graduation. Having debt is an enormous burden at any stage of life if you are unemployed. Choosing a school is a great opportunity for parents to lead by example on how to make a purchase decision for any “big ticket” item. Do your homework. Buyer beware. Coach them using some of the same skills you would use to buy a house or purchase a car or invest in a new business.

Reprinted with permission from RISMedia. ©2014. All rights reserved.

5 Financial Risks to Consider in Retirement

Most people don’t know that 80 percent of mountain-climbing accidents don’t occur on the way to the summit – they happen on the way down, says financial expert and extreme sports enthusiast David Rosell.

Although arriving at the top of the mountain is considered by many mountaineers to be one of life’s greatest accomplishments, I can tell you firsthand that summiting is not the ultimate goal for climbers,” says Rosell, CEO of Rosell Wealth Management and author of “Failure is NOT an Option,” (www.DavidRosell.com).

“They know that most climbing accidents and deaths occur on the descent. With this in mind, they will tell you that their objective is to reach the summit and get back down alive to see their family and friends. They understand that the second half of their journey presents the greatest risk and requires the most planning.”

“Likewise, we need to think of retirement as the descent from the financial mountain, which can be treacherous.”


Retirees and pre-retirees need to evolve from the traditional view of retirement, especially with so much legitimate concern about an unprecedented retirement crisis on our immediate horizon, he says. According to a 2013 report by the National Institute on Retirement Security, 45 percent of working-age American households have no retirement savings.

That’s on top of the 3.5 million baby boomers who have been retiring each year, and will continue to do so for more than a decade.

To help his clients thrive while experiencing descending their own financial mountains, Rosell briefly touches upon five major financial risks many experience during retirement.

• Inflation: During the second half of your financial journey, it’s critical that you’re able to maintain your purchasing power. Inflation simply means that every year your money buys a little – or a lot – less than it did the year before. Currently, inflation is 3.5 percent, which doesn’t sound like much. However, even if the rate holds steady and doesn’t increase, prices will have doubled in 20 years.

• Longevity: According to U.S. Census Bureau figures, the over-80 population is increasing five times faster than the overall population. By 2030, the demographics of 32 states will resemble those of Florida today. With more golden years to play, you’ll want the funding to make them fun! “Today,” Rosell says, “going gray means time to play.”

• Health/long-term care: Sadly, the escalating costs associated with long-term care during retirement can make the possibility of outliving one’s retirement income a reality for many. Statistics reveal that as we age, there’s an increased probability of our eventually needing assistance with basic daily activities. The truth is that most of us will need long-term care in our later years.

• Market risk: Economic recessions have occurred throughout the history of modern economics and always will, averaging one almost every nine years. If the market loses 50 percent one year and then increases 50 percent the following year, where are you? Many people get this wrong; after the fall and subsequent rise of 50 percent, you will have lost 25 percent. "This happened twice in the last decade," Rosell says.

• The sequence of returns: Gains or losses, or the order in which you receive your returns, can have a major impact on your retirement portfolio. It can mean the difference between having enough income in retirement and running out of money too soon. Be careful when an analysis states that you should achieve your goals by obtaining a specific rate of return. In most cases, this statement has not accounted for the sequence of returns.

“These are by no means the only tricky slopes that may have an affect on your retirement,” Rosell says. “Just as you have worked a lifetime to have money for your golden years, now is the time to manage your wealth wisely.”

Reprinted with permission from RISMedia. ©2014. All rights reserved.

7 Tips for Protecting Your Identity & Money

At least 110 million consumers were affected by the hack involving Target and Neiman Marcus retailers. Whether or not millions more will have their identities manipulated and finances ruined within the coming months due to more breaches of security at other stores is anyone’s guess, says identity theft recovery expert Scott A. Merritt.

“By necessity, I became an expert on identity theft. My information was stolen in 2006, and in repairing the

damage, I learned some not-so-obvious ways we can all protect against identity theft in the first place,” says Merritt, CEO of Merritt & Associates (scottamerritt.com) and author of "Identity Theft Do's and Don'ts."

Merritt’s problems began quickly. While disputing financial charges and dealing with resulting business problems, in 2007 he was stopped for a traffic violation and arrested on a false outstanding felony warrant. He immediately knew why.

“I had to enlist my U.S. congressman and convince the state police, NCIC, FBI and Secret Service that I didn’t commit the felonies. For a few years, I had to prove that the prints did not match the false record in question. After legal action, however, I was able to have this corrected.”

Unfortunately, the millions affected by the recent hacks may be dealing with similar repercussions in the years ahead, he says.

Before you become a victim of identity theft, Merritt offers seven ways to guard against it.

• Understand how and where it happens. Identity theft is like being robbed when you are away from home; most thefts occur in places where you do business every day. Either a place of business is robbed, a bad employee acts improperly or a hacker breaches the office through the computer.

• Secure your wallet’s information. Photocopy everything in your wallet: photos, credit cards (front and back), membership cards – everything. Put the copies in the order the cards are arranged in your wallet, staple the pictures and place them in a strong box or safe.

• Make sure your information is consistent. For all of your identity and financial documents, make absolutely sure, to the smallest detail, that all of your personal information is accurate and consistent! Discrepancies such as using your middle initial on some documents, and not others, or having different addresses, can wreck havoc in proving your identity, and can compromise your credit score.

• Secure your digital habits and data. Change your passwords at least twice a year on a non-scheduled basis – don’t be predictable. Have a strong firewall if you shop online, and only access sites that are protected by a strong firewall and high industry standards. Access accounts of a financial nature only from your personal computer.

• Protect your banking information. While in the bank, keep account numbers and other data out of sight, and avoid stating account numbers, Social Security numbers and similar information out loud. When planning a bank visit, have items such as deposits and withdrawal slips prepared in advance.

• Account for your interactions with vendors. Every time you speak to someone with whom you do business, write down the time, date, name and the purpose or outcome of the call. If an identity theft occurs on the vendor’s end, you will be able to reference these prior conversations effectively. Be sure to note any animosity or reluctance from the vendor.

• Don’t carry around your birth certificate or Social Security card. Unless it’s necessary, keep those vital items in a safe, or at least a firebox. If you know someone is going to need a copy of your tax returns or your driver’s license, for example, make the copies ahead of time. This avoids the need for a firm’s employee to leave the room with such information.

“Of course, you can greatly reduce being a victim of such recent hacks that occurred at the major retailers by using cash more often,” he says. “But if you’re going to use credit, use a card from a national bank or a national credit union and never a debit card, no exceptions.”

Reprinted with permission from RISMedia. ©2014. All rights reserved.

Selling on a Budget? The Best Low-Cost Home Renovations

ANAHEIM, CA, Jan 7, 2014—Selling your home usually requires some staging maintenance. However, for those on a budget, there are still some changes you can make to help your home sell faster while keeping money in the bank. Below, Meghan Shigo, REALTOR® at CENTURY 21 Award provides us with a few ideas.

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1. Painting – Whether you need to give the interior or exterior—or both—of your home a facelift, painting is the cheapest and easiest ways to keep your home looking fresh and well-maintained. With a bit of patience, you can even do the interior paint job yourself. “I would hire a professional for the exterior,” recommends Shigo.

2. Landscaping - “A messy exterior automatically sends the wrong message to buyers,” says Shigo. Keep the grass cut, the garden happy, and tools or toys out of sight. “If your budget allows, plant a few new trees or add some outdoor furniture so buyers can envision themselves spending time in your yard.

3. Accents – Linens, rugs, curtains, furniture covers – all of these can be quickly refreshed for a relatively low cost, and they really can amp your home's appeal. “Even a few throw pillows tailored to the color scheme of the season you're selling can make an interior more inviting,” notes Shigo.

4. Energy efficient updates - “If you can afford it, get a few energy efficient features added to your home. They are a major selling point right now,” says Shigo. Budget depending, you can have new windows installed, or just an energy efficient washer and dryer that you can offer as an inclusion with your sale.

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For more information on selling your home, please contact Meghan Shigo at meghanshigo@gmail.com, (714) 780-0500, or http://www.meghanshomes.com/

For more real estate information, please contact CENTURY 21 Award at info@century21award.com, (800) 293-1657, or http://www.century21award.com/.

How-To Refinance Without Perfect Credit

LA MESA, CA, Dec 31, 2013—Are you hoping to refinance, but nervous because your credit is not where it should be? Unlike what you may have heard, it's still possible to refinance your mortgage without great credit. Below, Cynthia Bell, REALTOR® at CENTURY 21 Award provides us with several tips how.

Start with clear expectations. You may be hearing about great refinance rates. However, without great credit, these will probably not be available to you. “Although you won't be applicable for the best rates, you can still refinance.” says Bell. “Just be ready for higher interest rates.”

How is your equity? “Your equity may be more important when refinancing than your credit,” Bell cautions. If you have a scant amount of equity, this could be your greatest challenge. “Try applying for an FHA-backed loan, as they're easier to secure.”

Show your best assets. If your credit history is shady, show your lender that you are, in fact, improving. Show how you're working hard to pay off your debt. Highlight that you have a long-standing, steady and secure job. Provide any bank statements that show a full savings account, and highlight that you haven't made any risky purchases—new car? That's a red flag right there.

“While securing a refinance is more difficult with bad credit, it isn't impossible. Be sure to put your best financial foot forward and you can most likely still find a lender,” says Bell

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For more information on refinancing, please contact Cynthia Bell at cynthiabell@century21award.com, (619) 668-4471, or http://www.cynthialbell.com/

For more refinance information, please contact CENTURY 21 Award at info@century21award.com, (800) 293-1657, or CENTURY 21 Award.

Tips for Managing Your Year-End Taxes

(BPT) - The close of every year seems to bring its own uncertainty from a tax-planning perspective. Last year featured the expiration of certain temporary tax provisions and the commencement of automatic federal government spending cuts. In October the President and Congress temporarily agreed on funding the government and increasing the national debt limit. But these issues may reappear in 2014 and could result in tax law changes that affect income-tax and financial planning.

For now, the best approach is to focus on how to limit your exposure to the many new or increased taxes in 2013 and beyond.

1. Manage higher taxes

Many taxpayers will be faced with higher tax bills in 2013 as a result of:

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* The temporary reduction in the Social Security tax from 6.2 percent to 4.2 percent that expired at the end of 2012. This means an increase of $2,000 in taxes for $100,000 of wages.

* The tax rate on wage income that increased from 35 percent in 2012 to 40.5 percent in 2013. The tax rate on interest income that increased from 35 percent to 43.4 percent and the tax rate on capital gains and dividends that rose from 15 percent to 23.8 percent for high-income taxpayers.

* The Affordable Care Act, which was passed in 2010, that increased the Medicare tax from 1.45 percent to 2.35 percent for high-income taxpayers starting in 2013.

Strategies that can help minimize these taxes:

* Avoid a transaction, such as selling stock, which would push you into a higher tax bracket.

* Accelerate any deductions that you control, for example, pay your January mortgage in December to get the interest deduction in 2013.

Note that tax considerations are only one factor when determining whether to buy, hold or sell an investment.

2. Understand the new investment income tax.
The new 3.8 percent tax on investment income was created under the Affordable Care Act and became effective in 2013. The income threshold for this tax is $200,000 for individuals and $250,000 for joint filers.

For those affected, there are short-term and long-term strategies that can help minimize this tax burden.

A short-term strategy involves trying to manage your tax position to keep below the threshold for the 3.8 percent tax or to minimize investment income in any year where you will exceed the threshold.

A long-term strategy is to consider investment options that avoid the tax or change the types of investments you hold to include more that are not subject to the tax.

People who think they cannot be affected by high-income thresholds need to understand that the income amounts are not indexed for inflation. Over time, more and more taxpayers will be subject to the tax - even if their real or inflation-adjusted earnings are the same.

3. Consider converting retirement assets.
Recent increasing tax rates created a unique opportunity to accelerate gain and pay taxes at lower rates. Individuals who converted assets from a traditional before-tax IRA to an after-tax Roth likely benefitted.

After-tax Roth IRAs generate tax-free income, subject to you holding the account for five tax years and reaching age 59.5. If you have a traditional 401(k) or IRA, you can convert that asset to a Roth IRA by paying the tax on the gain or before-tax value of the asset. While any conversion tax liability in 2013 will need to be paid with your 2013 income tax return, it may make sense to convert some funds to a Roth IRA and diversify your retirement assets from a tax perspective. In addition to possibly paying tax on the gain at lower rates, a Roth IRA offers other benefits, such as not being subject to age 70.5- required minimum distributions, and limiting the impact of Medicare surcharges and the 3.8 percent investment tax.

4. Contribute to an IRA.
Many individuals do not realize they can contribute to an IRA each year regardless of their income or whether they have a retirement plan at work. The only requirements for making a contribution to an IRA are that you have earned income of at least the amount contributed and you have not reached age 70.5.

While you have until the due date of your income tax return in April of 2014 to make your 2013 IRA contribution, delaying the contribution until then results in you losing some of the opportunity for tax-favored growth. So consider making your 2013 contribution now and your 2014 contribution in January 2014. Depending on your income, you may be able to contribute directly to a Roth IRA and enjoy tax-free growth. Even if you earn too much to contribute directly to a Roth IRA, you can fund a traditional IRA and then convert some or all of the funds to a Roth IRA.

CENTURY 21 Award, its affiliates and their financial professionals do not render tax or legal advice. Please consult with your tax and legal advisors regarding your personal circumstances.


Reprinted with permission from RISMedia. ©2013. All rights reserved.

Mortgage Madness: What You Need to Know Right Now

IRVINE, CA, Dec 24, 2013—Weeding through all of the available information on mortgage rates can be exhausting. From trends to current percentage fluctuations, there is always a surplus of information at your fingertips. Below are three things you should know about today's mortgage arena, provided by Elsie Parker, REALTOR® at CENTURY 21 Award.

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They're on the way up – but still look good. Today's rates are higher than they were a year ago, but they're still relatively low. Recently, mortgage rates were weighing in around 4 percent, which isn't as low as 2012's 3 percent, but is still a great rate.

They shouldn't stop you from buying. If you're waiting to purchase a home because you think mortgage rates may drop – don't. While mortgage rates do increase and decrease slightly from month-to-month, larger changes happen extremely slowly. “If a fraction of a percent increase or decrease dramatically changes how much house you can buy, then you may be shopping a bit out of your price range,” explains Parker.

There could be upcoming changes. The Federal Reserve has been keeping interest rates low by purchasing billions of dollars' worth of mortgage-backed securities every month, called Quantitative Easing. The Fed admits that this program may not be around much longer, and that when it is eliminated, mortgage rates will spike. “This is only a speculation, but it is still something to keep in mind if you're deciding on the right time to buy,” Parker notes.

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For more information on mortgages, please contact Elsie Parker at eparker@century21award.com, (714) 402-0567, or http://www.esphomes.com/

For more real estate information, please contact CENTURY 21 Award at info@century21award.com, (800)-293-1657, or CENTURY 21 Award.