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Ta-Ta Tatellah

College: an institution of higher learning. A time for many of us to learn about living on our own, charting a course for a direction in life to follow the path to the pot at the end of the rainbow. For others it may be an occupational school and pursuit, finding out more about ourselves than we ever imagined. While the institutions of higher learning vary greatly, they have one common element- they have to be paid for. Scholarships and grants are nice, but preparation for this hugely expensive trip to the future is something that takes forethought, planning, time... and a lucky lottery ticket! For the rest of us though, it's the planning part that we all should take into timely consideration when forecasting for the future of our children and our nation.

College saving for our children is a daunting task. Having walked this path with my own daughter and hundreds of other families through the years, the first thing I point out it it's never too early to start. You can never go back a year to save, so every year counts. There are a number of ways to get to your goal- lets take a look. The first step is to determine (or calculate, to the best of your ability) how much you will need for both the first year or the full 4 years (or more, if you plan for your child to go to graduate school). Community college, State or Ivy League- choose your fancy and get a current estimate. Then it's time to calculate that number times the years you are saving to, a hypothetical growth rate of school costs, how many years you have to save, an estimated rate of return, and ultimately how much annually or monthly needs to be saved each period to meet your goal. It's not a set it and forget it kind of thing- each quarter or year you have to calculate if you are on track, ahead or behind. If you're behind, you need to step up the payments to make up the shortfall. If you're ahead, don't celebrate yet: you can pretty much count on a down year to balance it out, so don't reduce your contributions- remember that the goals you set are only estimates, so having a bit of a cushion can never be a bad thing.

The way you save and the vehicle you utilize to save can be helpful in meeting your goal of having enough money when the first year of tuition comes due. Since I am limited to the size of my article by management, I won't get into the many ways you can save- throughout the years I've written on most all of them which can be found on my website in the articles section (, articles, type in college planning). I do want to focus in on one way that most people are not aware of: a college savings trust. Different from the terms of a 529 plan, or a gift to minor's plan, the utilization of a college trust allows the Grantor (you- the one who puts the money in) to determine the terms of the trust and how it pays out to your darling child or grandchildren. You can put in all kinds of conditions the child has to meet to receive their disbursement, and terms to keep them from getting any money at all if they grow up to be other than we imagined when they were young. You can dictate how they get the remainder of the funds if any once they finish college, or don't go at all. You have a say in all the ways the funds are to be used, as opposed to other planning methods that tell you instead of you saying how the money is to be disbursed. If heaven forbid you pass away before they finish or even go to college, you've set a plan for the use of your hard-earned money and how it will benefit your little loved one. The most important thing is that you're helping your family find their future. It's a wonderful feeling to know you're giving your kids a hand up- I for one don't envy them at this time in the economy... it's not easy, and they can use all the help they can get. Note that all types of trust planning should always be done with the assistance of an experienced Certified Financial Planner® and a competent attorney skilled in the ways of trust planning.

As with all subject matter, I can't cover all the ramification in a 750-word article: be sure to do your homework and associate yourself with a trusted advisor who know the ins and outs of your particular situation. And as for the title, it you've not figured it out by now (go ahead, take a minute) Ta-ta is the same as bye-bye. Tatellah, loosely translated, is Yiddish for little man. Little girl would by a kleyne meydl, but it didn't ring right in the title... just consider all of our kid's wonderful gifts from the universe. So, when it comes to college, bye-bye little man or little girl... and for us grown-ups, let the party begin!

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