Website Recommendations
This month’s recommendations are from my family!
My sister, shares this gasoline website. Just enter your zip code in the site below, and it tells you which gas stations have the cheapest prices (and the highest) on gas in your zip code area. It’s updated every evening.
http://autos.msn.com/everyday/gasstations.aspx?zip=&src=Netx
My second cousin Cindy shares a way to save on “411” calls. Cell phone companies are charging us $1.00 or more for 411 / information calls when they don’t have to. When you need to use the 411 / information option, simply dial 1 800 FREE 411 or 1 800 373 3411 without incurring a charge at all except for the minutes required to make the call.
May Shopping
Honestly, with the weather so beautiful, I’m trying my hardest to be outside and not shop except for necessities! Less shopping means less gasoline consumption, too. Follow this lead and you’ll save all kinds of money!
1-Pepperidge Farm Thrift Store: New frozen food shipment came in this past week. Check out the entrees at $3.99! Ask when their next shipment is coming in!
2- Party City: Stock up on their plastic tablecloths at $0.69/each. With young, messy eaters, we save a lot of frustration w/ clean-ups using plastic tablecloths. This is a cheap price and you can buy now for birthdays, holidays, etc. If you are involved with ministries or civic groups, this is the time to stock up for events needing table cloths. This sale runs through 5/29/06.
3-Plants: One way a saved a few pennies this year was to bring indoors some of my annuals during the winter. Essentially, I’ve made annuals perennials by keeping them in my living room until they could be replanted in Spring. This takes time to care for plants during the winter and may not work with your lifestyle or children. However, you can save a little trying this when Fall arrives. If you enjoy plants, like I do, then the money you save doing this can be used to buy even more for your garden in the Spring! (I’ll put a “plug” in for my friend Kim. Her husband owns the plant stand near Saratoga subdivision and one in Vienna in a shopping center. If you are looking for Spring color, consider supporting neighborhood plant stands. The n’hood stands often offer healthier plants that have been watered more frequently.)
College Savings
I’m not an expert on college savings. However, I would like to share a few thoughts to motivate us (including me) towards saving for this important goal. If you read this newsletter and can offer advice, please email me and I’ll include reader feedback in next month’s edition.
Due to the abundance of info that can be discussed on this topic, I’m going to feature college savings in May and June’s news letters. So, this is part I of a two-part “discussion.”
Ok. If you want a reality check, go to www.finaid.org and pretend you have a child going to college this Fall. The website has a calculator tool where you can input your basic financial scenario without including your name, social sec #, etc. What you can do is ballpark estimate the cost of tuition, books, room & board, etc. for up to 3 colleges. The calculator will then tell you what financial aid (in ballpark dollars) your child could be eligible.
I’ve concluded if you’re above the poverty level, and I’m guessing all my friends are… you are going to have to “foot the bill” for your child’s education unless your child is awarded a scholarship. As a parent, I know I would like my children to graduate w/out college loan debt anchored like a ball and chain to their neck. However, everything I’m reading recommends funding retirement funds (for self) first, and then approaching college savings after retirement is “taken care of.” FYI—For scholarship info, check out www.scholarshipcoach.com.
So what can I start doing? If you are just starting your college savings program, here are my recommendations. Before any college savings, ensure that you are aggressively saving towards retirement. Your children can always get a loan for college, but you cannot get a retirement loan!
For children’s college, first, go to www.upromise.com and participate in their 529 plan. I view this plan as “free money” because with Upromise, there are several activities you can do to have money contributed to a 529 plan without it costing you anything extra. We’ve accumulated a few hundred dollars by not doing anything more than using their Citibank credit card and enrolling our CVS drugstore card, grocery shopping cards, etc. I would not recommend your doing anything out of the ordinary or special to build funds through Upromise. But essentially, this is free money if you pay off your credit card bills monthly. So grab the freebie!
If you do not have children, but have a neice or nephew, consider participating in the upromise plan to benefit a family member. For example, an uncle can use his CVS card and have his “points” accumulate towards college savings for a nephew. Thus, if you have several friends and/or family members who will sign up and let their purchasing activities count towards your child, you can amass a few extra bucks without it costing anyone anything extra
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Second, explore prepaid college plans. Many states will allow you to pay now and lock into today’s college tuition rates for your child to use in the future. I’ve not done this, but I know several who have used this. If anyone’s done this, email and tell me your thoughts & experience for next month’s readers! I think this is a reasonable approach if you are certain your child will stay in-state. Yes, most of these programs allow you to use funds with other colleges and universities. However, you never know when the prepaid program could change terms and conditions. Therefore, if you go this route, make sure you understand any restriction about future college choice.
My family has not chosen this route, but I know others who have. Honestly, I have not spent enough time researching options for my own children on this possibility. If you live in a state where you know your children will attend college, then I think this is an excellent option!
Third, set up an educational savings account. You can set up a Coverdell Educational Savings account (ESA), which is limited to a $2,000/year contribution. There are some income restrictions with ESAs; thus, you need to read more about this option before assuming you’re eligible. ESA funds can be used for education prior to college, such as private schooling.
Fourth, consider a Roth IRA. I opened a Roth IRA as a savings tool purely for the flexibility of having the option of withdrawing funds tax-free to help pay college expenses or allowing them to accumulate for my retirement. While there is no deduction on my taxes today for a Roth IRA investment, I am hoping my investment will grow rapidly and help my children avoid borrowing as much for their education. I use Vanguard investment services for my Roth, but you can select from a variety of mutual funds from most any brokerage firm.
For the ESA or Roth IRA, go to websites hosted by Vanguard, Merrill Lynch, T. Rowe Price, etc. and educate yourself. Also, read about them in a Suze Orzman book (although she’s not my personal favorite…she can explain the difference in her writings) or at www.fool.com (Motley Fool’s website).
Fifth, have your child start saving now. Teach your kindergarten child to save his birthday money. Set up a savings or money market account (you decide if you want a mutual fund or money market…you decide your risk/reward factor) and let your child start learning to save instead of spend. You might need to establish the account in your name and social security number. This will be a good lesson that he can use when he starts allowances and working outside your home. If your child is 10 years or younger, I strongly recommend investing 100% in a mutual fund (try a S&P 500 Index fund or a growth fund that is not an industry sector—something less volatile). If your child is age 16 or older, consider splitting investments—50/50 money market (safe and won’t lose value if the market plummets) and mutual fund (my advice).
Another point about children saving—In addition to teaching your child financial principles, you help the child to see he’s got a “vested interest” in his education. He can appreciate the cost of tuition because he’s helping to pay for it. If a child pays for something he’s more likely to be serious about the expense (not take the 5-6 year plan to graduate).
Memorial Day
With Memorial Day fast approaching, let me share a few ideas on savings. Many of us enjoy a weekend get-away this time of year. With higher gas prices, how about staying home and planning a cook-out or picnic with a neighbor family? You will save lots of money (limited gas expense, no hotel, etc.). Plus, you can get to know a neighbor better. This would be a great way to build relationships where you can invite folks to church…or even share savings tips! I bet you could even use your deck (since few people in my community seem to use theirs) and have friends over to play a game or two.
Personal Note
May 5, 2006 marked the 20th anniversary of my dad’s death. While this was a hard and sad day, I believe I honored his memory. I chose to make a special gift to World Vision for use in their humanitarian efforts in Africa. There are so many starving in Africa. Saving for the future is important, but giving in the present is equally, if not more important!
If you are looking for a neat way to honor someone, let me encourage you to give a charitable contribution in their honor (or in their memory). Most everyone has a favorite charity. However, if you are looking for a good place to give, I would like to share I’ve enjoyed sponsoring a child overseas with World Vision. J Also, I’ve found that my children enjoy praying for our sponsored child. They see us giving and it’s a great way to model stewardship. Just a thought to consider! www.worldvision.org
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I enjoyed sharing earlier this month with Virginia Hills Baptist’s MOPS group! Thanks ladies!
If you have a church or civic organization, and you’re looking for a speaker, I would love to talk with you about the opportunity. Not only do I speak about financial matters, but I enjoy sharing about spiritual topics.
Thank you to those of you who have inquired about my book, Face of Courage. I’m having a lot of fun telling folks about my book and sharing in this ministry!
Joy to you!
Michele Buschman
“I have learned the secret of being content in any and every situation, whether well fed or hungry, whether living in plenty or in want. I can do everything through Him who gives me strength” Philippians 4:12-13.