Tag Archives: 529 savings plan

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Money Matters | Are You Prepared to Handle a Personal Financial Crisis?

michelle-head-shot
Michelle Floyd, CFP,
Financial Consultant

Are You Prepared to Handle a Personal Financial Crisis?

Individuals who are married or in a committed relationship face the possibility they’ll end up managing finances alone at some point in their lives. Unfortunately, the first time many experience handling complicated financial matters alone is during a personal crisis following the death or divorce of a spouse or partner.

We’ve prepared a list of thought-provoking questions pertaining to financial fitness and crisis preparedness. You can use these as a starting point to check how prepared you are to handle a personal financial crisis in your life. Begin by reviewing the questions, determine what you’ve already done, and check those items off the list. For the questions you need to address or take action on, seek the advice of professional advisors and trusted family members.

Asset management

• Do I have a clear picture of where my assets are located?
• Will my retirement assets provide a comfortable retirement for my life expectancy?
• Do I have a well-diversified portfolio?
• Are my investments appropriate in today’s economy?
• Are my assets titled properly?
• Do I have an emergency fund?
• Am I taking advantage of techniques to reduce my taxes?

Estate planning

• Do I have a will?
• Is my will current?
• Have I determined what my family may owe in estate taxes?
• Have I funded my estate-tax liability?
• Have I explored and taken advantage of wealth-transfer techniques?
• Do I wish to provide for charitable giving?
• Are my power of attorney and my living will up to date?

Debt management

• Do I know my credit rating?
• Could I get a loan if I applied?

Insurance

• Do I have enough insurance coverage to cover medical expenses?
• To provide for disability/long-term care?
• To provide for family members’ security?
• To fund estate-tax liability?

In addition …

• Have I coordinated my advisors’ (attorney, CPA, banker) activities?
• What changes in my life are likely to occur within the next three years?
• Do I know the status of my parents’/children’s financial situation and the implications for my financial well-being?
• Would I be prepared for a family emergency if it happened tomorrow?

Our firm does not provide legal or tax advice. Be sure to consult with your own tax and legal advisors before taking any action that could have tax consequences. Any estate plan should be reviewed by an attorney who specializes in estate planning and is licensed to practice law in your state
This article was written by/for Wells Fargo Advisors and provided courtesy of Michelle Konkle, CFP®, Financial Consultant with Axiom Financial Strategies Group in New Albany, IN at 812-948-8475.
Investments in securities and insurance products are: NOT FDIC-INSURED/NOT BANK-GUARANTEED/MAY LOSE VALUE
Wells Fargo Advisors is a trade name used by Wells Fargo Clearing Services, LLC, Member SIPC, a registered broker-dealer and non-bank affiliate of Wells Fargo & Company.

© 2017 Wells Fargo Clearing Services, LLC. All rights reserved. CAR 0217-04864

2017-money-matters-feature-generic-for-articles

Money Matters by Michelle Floyd | Involve Your Child in the Finances of College

By Michelle Floyd

The cost to attend a university continues to increase: between the 2011–2012 school year and the 2016–2017 academic year, tuition and fees rose by 13% at private, nonprofit, four-year institutions, reaching an average of $33,479, according to The College Board.*

If you’ve diligently saved over the years to help pay for your child’s education, now is the perfect time to bring him or her into the equation. “When it comes to financing school, students need to be involved in the process,” explains Tracy Green, a Life Event Services consultant at Wells Fargo Advisors.

By walking through the financial steps of paying for college together, you’ll help your son or daughter understand the overall expenses and learn valuable fiscal skills for the future, especially the importance of goal-based saving.

Green recommends following these five steps to get your child involved before mailing in that acceptance notification and deposit.

  1. Start with a conversation. Before your child even begins applying for college, have a discussion about finances, suggests Green. A good time to have this conversation tends to be during the student’s junior year of high school.

When you sit down together, ask your child about his or her upcoming goals. Talk about expenses for school, as well as who will be covering costs or how they might be split. If you or other family members have contributed to a 529 plan, show it to your child and go through the details of how it can be used.

  1. Set a budget. As a family, consider setting certain guidelines and limitations for the college experience. Perhaps you agree to cover the cost of tuition and room and board, but ask your child to pay for his or her entertainment expenses while on campus.

“Having those discussions may prevent future disappointment,” adds Green. If your son gets accepted into his dream school, for instance, but later learns the family won’t be able to pay for it and he doesn’t want to take out his own loans, the reality could be difficult to face.

  1. Look at financial aid packages together. With your child, fill out and submit forms for financial help, such as the Free Application for Federal Student Aid (FAFSA). Learn more at https://fafsa.ed.gov/. To identify additional types of financial aid that may be available, visit https://studentaid.ed.gov/sa/.

Some universities have a net price calculator on their websites. With this tool, you’ll be able to see what the overall cost for the school is and then subtract any financial aid packages available to identify what your expected expenses will be. Once you start receiving acceptance notifications, go through aid packages with your child to compare and contrast them so that you and your child have a clear vision of what the bottom line is and how different aid options are treated.

  1. Think about work. If you want your child to be responsible for paying for part or all of their schooling, a part-time job may be a good fit.

As a family, you’ll want to decide if it makes sense for your child to work while he or she is at school, or only during summer and winter breaks. “Some kids may have a heavy class load or extracurricular activities,” notes Green. If certain scholarships require your child to attain or keep a certain GPA, you’ll want to weigh the time spent away from academics against the amount of money your student will be earning from a part-time job.

In addition to helping cover college expenses, employment can offer other key benefits for your child, including the chance to manage an income, build a strong work ethic, and grow in self-worth. If working during the school year will put too much of a strain on your child, set savings goals together for his or her summer job. 

  1. Understand scholarship possibilities. If your child wants to attend a school that doesn’t fit into the budgeted amount you planned to spend, consider sitting down to talk about the situation. It may be time to look at other options, or your child may want to increase his or her efforts to identify and apply for scholarships to help cover some of the costs.

The site TuitionFundingSources.com, sponsored by Wells Fargo, provides a database of scholarships available. After looking through the options together, help your child set up a schedule to apply for ones that are the best fit, paying close attention to deadlines and other requirements. Some scholarships involve writing an essay, but the rewards offered could make the effort worthwhile. 

*https://trends.collegeboard.org/college-pricing/figures-tables/tuition-fees-room-and-board-over-time

 Please consider the investment objectives, risks, charges and expenses carefully before investing in a 529 savings plan. The official statement, which contains this and other information, can be obtained by calling your Financial Advisor. Read it carefully before you invest.

This article was written by/for Wells Fargo Advisors and provided courtesy of Michelle Floyd, CFP®, Financial Consultant with Axiom Financial Strategies Group of Wells Fargo Advisors in New Albany, IN at 812-948-8475.
Investments in securities and insurance products are: NOT FDIC-INSURED/NOT BANK-GUARANTEED/MAY LOSE VALUE

Wells Fargo Advisors is a trade name used by Wells Fargo Clearing Services, LLC, Member SIPC, a registered broker-dealer and non-bank affiliate of Wells Fargo & Company.

© 2017 Wells Fargo Clearing Services, LLC. All rights reserved.   0317-00810