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As higher education costs continue to soar, many parents find themselves faced with a nagging question: "Will I have enough money to pay for my child's college education?" Although most people today are likely to agree that an investment in higher education usually reaps its rewards in higher long-term earnings - and, hopefully, greater job satisfaction - one key concern is how to choose a smart savings alternative. 529 plans are flexible investment options with tax benefits.

The average price tag for four years at a private college exceeds $120,000, according to the College Board's Trends in College Pricing 2006. That's 35% higher than just five years ago. In fact, rising tuition costs are outpacing inflation, while federal grant aid is lagging behind inflation.

One "extracurricular" activity that every student should master while in college is personal money management. Typically, a student's day-to-day spending is done on an improvised basis, meaning that overspending is often the norm rather than the exception.

It wasn't long ago that an individual went to school, got an education, and embarked on one career that usually lasted a lifetime. Many companies provided on-the-job training, and little thought was given to "going back to school." It was common to be asked in a job interview where you saw yourself in five or ten years. Many people fresh out of school could see a fairly predictable career track ahead.

There is no escaping the fact that college costs are rising. According to the College Board, a not-for-profit membership organization composed of more than 4,700 educational organizations, the average annual tuition at four-year private universities is $20,082, up 6% from last year, and $5,132 at four-year public universities, up 10.5% from last year.

There is no escaping the fact that college costs are rising. According to the College Board, a not-for-profit membership organization composed of more than 4,700 educational organizations, the average annual tuition at four-year private universities is $20,082, up 6% from last year, and $5,132 at four-year public universities, up 10.5% from last year.

College tuition costs keep increasing on a yearly basis with no apparent end in sight. Including tuition, fees, room and board, the average cost at private colleges averaging $30,000 per year (Source: Trends in College Pricing - 2006, The College Board). With this in mind, the projected cost of educating today's newborn is staggering.

Students who receive scholarships or grants need to be aware that some monies they are awarded may be taxable. The portion of a scholarship that is taxable is that which applies to room, board, travel, and other noneducational expenses. On the other hand, scholarship dollars used for tuition, fees, books, supplies, and course-required equipment are nontaxable.

Parents who would like to give property to their minor children may be unaware of their options regarding the ways in which property can be held for the benefit of their children. Essentially, there are only four ways in which a parent can give property to a child: 1) give it outright; 2) give it in a trust; 3) give it by means of a guardianship; or 4) give it through the use of a custodial account.

Owning land has its rewards. But when the land is a ranch, farm, or other undeveloped property, those rewards are often measured more in satisfaction than in cash flow. This can create a huge tax problem for family members who inherit valuable undeveloped property.

One of the things that made the now iconic TV show The Brady Bunch stand out when it first hit the airwaves in the late 1960s was that it depicted what was, at least at the time, a very unusual family dynamic: a second marriage bringing together six children - three from each parent - under one roof.

One of the things that made the now iconic TV show The Brady Bunch stand out when it first hit the airwaves in the late 1960s was that it depicted what was, at least at the time, a very unusual family dynamic: a second marriage bringing together six children-three from each parent-under one roof.

Bill and Susan have been thinking about creating a life insurance trust to provide estate-tax-free benefits to their children. But they would also like to be able to access the cash value of the life insurance policy that's in the trust. Impossible dream? Not at all. Family split-dollar life insurance may allow them to do both.

Many people who plan carefully to keep income taxes at a minimum don't give any thought to estate taxes. They assume that estate taxes affect only the very wealthy. Not true. Currently, any estate worth more than $1.5 million may be subject to federal estate taxes æ at rates ranging as high as 47%. With so many dual-income families and the high value of real estate in many areas of the country, an estate of this size isn't necessarily a large estate.

If you're like many investors, the prospect of using something called an intentionally defective irrevocable trust (IDIT) may give you pause. After all, why would anyone create a trust that is designed to be defective? The fact is, however, that an IDIT can be one of the most effective components of a comprehensive estate planning strategy.

Once the estate planning process is initiated, there are a number of strategies that may play an integral role in your family's future. Even if you are just starting to build your estate and do not need complex estate planning, here's a quick look at some common planning measures and tools that can help you protect your family and reduce potential expenses in the event of your death:

Paying the estate tax can be quite a challenge for individuals with large estates. Given the fact that the value of an estate in excess of $2 million is taxed at 45% (for 2008), estate taxes can be quite substantial.

For someone with $2 million dollars, buying a second new car for a son who wrecked the first one is not a problem-financially, that is. But it creates this awful sense for the child of not having to be responsible.

If you've been working hard and investing for years, you probably have enough resources to live well and feel confident in your financial future. Your next consideration may be how to build a legacy for your family and future generations. No matter what your asset level, holding family meetings to clarify your values and plans for the transfer and management of your wealth can be an essential part of this process.

Many individuals generally view bonds as a conservative investment that provides steady income and a higher degree of protection of principal. With the oversize gains in the stock market over the past two decades, it is understandable how bonds can easily be overlooked as market euphoria sweeps up individuals.

Do you own an apartment or office building, undeveloped land, or other investment real estate that you'd like to sell? If the prospect of paying a large tax bill on your property's appreciation is holding you back, there may be a tax-wise solution for your dilemma.

Consider this scenario: You are about to retire and are offered a pension of either $3,000 per month during your lifetime or $2,500 per month over the lifetimes of both you and your spouse.

For most investors-even those with significant wealth-a secure financial future doesn't simply happen. Instead, it must be carefully crafted to help meet your most important goals and leave nothing to chance. Of course, the future is unpredictable and your own personal situation changes over time. That makes it all the more challenging to answer the most crucial of financial questions: Are you on track to achieve your financial objectives?

The Economic Growth and Tax Relief Reconciliation Act of 2001 is estimated to result in nearly $1.35 trillion in tax cuts over the next ten years, representing the largest tax cut since the 1981 rate reductions during the Reagan administration.

For most taxpayers, the words "tax audit" can produce some feelings of anxiety. There are probably few word combinations that raise the average person's anxiety level.

Caught up in the emotional turmoil that usually accompanies divorce, it is easy to for estranged couples to overlook the serious financial issues that arise as they seek to divide up their assets and establish independent lives. But even in the midst of fraught divorce proceedings, it is important to consider the tax implications of property division, custody arrangements, and child and spousal support agreements.

The cost of a college education can be staggering. Total expenses at private universities currently average more than $33,000 a year¹. The annual cost for state colleges averages about $16,3001. For many families, qualified tuition programs - also called Section 529 education savings plans - are an attractive way to help meet future education expenses.

Paying for a child's college education is an expensive proposition - but not an impossible one. With the right strategies, you can go a long way to meeting this challenge whether your child is still in preschool or already in high school.

In recent years, revocable living trusts have been touted as a simple, cheap supplement to wills. But are they? It's called a living trust because you set it up and put some or all of your assets into it during your lifetime. Typically, you serve as trustee which gives you control of the assets until death. After your death, they are distributed according to the terms of the trust document and don't go through probate, which can be costly and time-consuming.

Trusts can be used to accomplish any number of estate planning goals. But the success of a trust strategy often depends on how well the trust is managed - and that depends on the abilities of the person (or institution) named as trustee.

What do Elvis Presley and you have in common? Absolutely nothing, you're probably thinking. But if your estate plan isn't in order, you may have the same problem he had before he died in 1977 at the age of 42. At his death, his estate was valued at over $10 million, but federal estate taxes and other estate settlement costs of more than $7 million reduced its net value to under $3 million¹. With a more carefully prepared estate plan, Elvis might have been able to leave more to his daughter and other family members, and less to the federal government.

For today's business owner, death can mark the beginning of a significant tax problem. The investment and sweat that went into building your business year after year could add up to a whopping federal estate tax bill for your heirs -- up to 47% of the combined value of your company and other assets.

Do you own a growing business? A high-value home in a strong real estate market? A substantial investment portfolio? The appreciation of assets like these is a good thing. But owning appreciating assets may also increase your exposure to future estate taxes, which is not a good thing.

In a "traditional" estate plan, each spouse provides for his or her assets (or most of the assets) to pass to the surviving spouse, with the understanding that those assets will go to their children at the surviving spouse's death. This planning approach may work well when the spouses have only been married once - to each other - and the only children involved are the ones they have together.

A Life Settlement enables older individuals, businesses, and other organizations to sell life insurance policies they currently own - but no longer want or need - for an amount greater than the cash surrender value.

You've heard the old investment adage, "Don't put all your eggs in one basket." It's good advice. A diversified portfolio should be at the core of any well-planned investment strategy. While a worthy goal at any age, it's especially desirable as your net worth grows over the years.

With the ongoing uncertainty of the stock market, people are continuing to investigate other financial vehicles, and annuities are just one of those options. Everyone has heard about annuities, but what actually is an annuity and why may they be a good retirement planning tool for you?

Wouldn't it be great to know in advance when to buy or sell an investment? You could purchase an investment at its lowest price just before a surge in value. Or, you could sell an investment just as it reaches its peak before dropping. If you knew the right time and acted on it, investing would be easy. Unfortunately, there's no crystal ball that shows what the future holds for the financial markets. That's why many investors take advantage of dollar cost averaging.

Years ago, when you found the right one, the only one for you, you promised to have and to hold. And, because you were faithful, you can now watch that $4-per-share stock trade at $124 in today's market. Unfortunately, the dividend payout, at about 3%, is inadequate for your income needs. You think about selling it all or diversifying, potentially doubling your dividend income, but you're reluctant because of the significant capital gains tax you would have to pay.

Think back to when you first started setting money aside in a long-term investment plan. Depending on when you began investing, you may have already seen your investments ride the ups and downs of shifting economic trends. Or maybe investing is a new experience and you're not quite sure what to make of your investment's performance amid economic and market shifts.

Taxes can take a chunk out of your investment returns; yet, many investors don't give much thought to taxes when they make investment decisions. While investment decisions shouldn't be based entirely on tax considerations, tax-efficient investing may make a significant difference in your net gain. Employing some of the following strategies could help you retain more of your potential investment earnings and lessen your tax obligation.

These days, some people may have a "sure-fire" way to time the stock market. Just check out the Internet. You can find screens advertising market timing services. A trip to your local library will yield an equal abundance of market timing theories in books, magazines, and other periodicals. And some of these theories may or may not work.

You may already participate in an employer-sponsored retirement plan and/or contribute to an Individual Retirement Account (IRA) or Roth IRA. If so, congratulations! You're one step ahead of many Americans when it comes to saving for retirement. But chances are you will still need additional retirement savings to secure your financial future and reach your retirement goals.

Today, life in America commonly finds families scattered across the country. With family members often separated by hundreds or thousands of miles, it may be extremely difficult to manage the care of an older parent or relative living far away. To help facilitate the best care possible for your loved one, and to help alleviate the stress long-distance caretaking could cause, you may want to take steps now to be prepared, should the need arise.

One of the most important estate tax planning tools available to married couples is the unlimited marital deduction. The deduction allows one spouse to pass an unlimited amount of property to the other spouse without incurring any federal estate or gift taxes.

Most everyone has, at some point in their lives, accumulated personal debt - some more than others. Whether debt is a cause for concern depends upon a number of factors, including how the economy is faring, your particular earning and economic prospects for the near and long term, and the type of debt you incur. By being conscious of your spending habits, including credit card use and large purchase habits, you can better understand ways to control debt - before it starts to control you.

A solid foundation supports the floors and walls of the building above. Without it, the building may not be strong enough to withstand bad weather and years of use.

For most of us, the big worry about retirement planning is building a sufficient nest egg. But according to the Employee Benefit Research Institute, millions of Americans have Individual Retirement Accounts (IRAs) totaling $3.67 trillion, an historic high in 2005.⁽¹⁾. It may be that the trickier part of an IRA isn't putting money into it-but taking money out.

Most of us find it easier to earn and spend money than to save it. Planning and saving for retirement too often takes a back seat to other priorities. Why is procrastination the rule, rather than the exception when it comes to retirement planning?

When it come to investing, are you a micromanager? Or a hands-off type? Micromanagers obsess over their portfolios. They switch in and out of investments with every tic and tremor on Wall Street or in the economy. Hands-off types are the opposite. While they might polish and buff their cars every weekend, they pay little attention to whether their portfolios are on track to help achieve their investment goals.

For years, you've been investing in an IRA or employer-sponsored retirement plan, and, thanks to the benefits of tax-deferred growth potential, you now have a considerable nest egg - enough to enjoy a comfortable retirement and pass a tidy sum on to children and grandchildren. Or so you think. Unfortunately, after taxes, only a small percentage of your retirement savings may be left.

Who should benefit from your retirement assets - you and your family or the federal tax coffers? The answer is easy: you and your family, of course. Achieving that goal is more difficult. These days, very few people stay at one job for their entire careers. So, by retirement, you and your spouse may have assets in four or five - or even more - employer-sponsored retirement plans and individual retirement accounts (IRAs). How you utilize those accounts at retirement can make a big difference in the amount of assets available to pass on to children or other heirs.

Planning and saving for retirement, like cleaning out the attic, may be something you figure you'll get to later. But when "later" arrives at retirement age, you may not have the financial resources to enjoy your golden years.

If you are planning on winning the lottery, don't bother reading this. For the rest of you, however, it is never too early to begin planning for a comfortable retirement. Given the new economic realities of retirement planning, building up a nest egg is a top priority. No longer can you rely on the government or employer-provided pensions to carry you through your retirement years. The long-term viability of the Social Security system is uncertain, given the crush of aging baby boomers who will begin retiring after 2010.

This article is for educational purposes. 1031 exchanges have restrictions and limitations.

When the time comes to sell your real estate, some owners of highly appreciated real estate could be staring at a substantial capital-gains tax bill. A section of the Tax Code may help you convert your appreciated property into an income stream-while deferring up to 100% of the capital-gains tax that would otherwise be due on the sale.