Jill on Money: Kids and Money, Inflation, Bonds
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Beth Kobliner is back in the house! Beth is a widely acclaimed financial journalist, author, member of the President's Advisory Council on Financial Capability and architect of the fabulous money.org web site. Beth highlights when to talk to your kids about money (as early as 2-3 year old!), the need to add financial literacy into the classroom and how our kids are measuring up when it comes to kids and money. Beth also discusses the need to limit college education debt and highlighted an important fact: where you go to college is less important than graduating with debt that is manageable.
Denny from KY is thinking about retirement, but with interest rates at such low levels, he is not sure whether the $400,000 he has accumulated is enough to provide the income necessary. The good news is that between his Social Security and his wife's Social Security, they can provide almost 2/3 of the need. Of course, the longer that Denny waits to retire, the better the scenario looks.
Nicholas and his wife have an infant and want to know whether a 529 in Texas is a good vehicle for saving for college versus investing in individual stocks in a brokerage account. In addition to the college planning, Nicholas is carrying credit card debt, which needs to be eradicated ASAP!
Augustine from CA is considering a reverse mortgage on his $450,000 house is a good idea for him. As I reminded him, the fixed payment of a reverse mortgage will remain constant, while prices will increase. In other words, the reverse mortgage payment that might make sense today, will not keep pace with inflation.
There is little evidence of inflation today there is little doubt that in the future, there will be price increases that could eat away at the value of bonds. Bob from MO called in to ask about whether given the prospect of future inflation, should move money out of his bond funds into stocks?
Mike and Ben wrote in with rollover questions; and Judi finished up the program with a question about using both 529 and the Lifetime Learning Credit. Check out the IRS web site for more information on coordinating educations credits and 529 plans.
Here are web sites and resources mentioned in this week's show:-- How to Choose a Financial Advisor: 10 Questions
-- NAPFA: National Association of Personal Financial Advisors (fee-only advisors)-- Reverse Mortgages via HUD Reverse Mortgages: The Basics
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