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Education Planning

Optimize Education Savings

Modern Wealth provides expert guidance on educational savings options to secure your child’s academic future. Our services include advising on 529 Savings Plans, which are investment accounts that grow tax-free, allowing for tax-free withdrawals for educational expenses. While contributions are made with after-tax dollars, these plans have no annual contribution limits, only state-dependent lifetime caps.

We also offer counsel on Coverdell Education Savings Accounts, which are tax-advantaged accounts with annual contribution limits, designed for a broader range of educational expenses. These accounts require funds to be utilized before the beneficiary turns 30 and offer more investment options than standard savings accounts.

Additionally, we assist with the Private College 529 Plan, a federal program that lets families prepay tuition at today’s rates for numerous private colleges, protecting against future tuition increases. Our aim is to provide comprehensive strategies that cater to your educational funding needs, ensuring you’re well-prepared for the significant investment in your child’s education.

Master Financial Aid Planning

Navigating the financial aid landscape is a key service at Modern Wealth, where we assist families in understanding and applying for various types of aid. Submitting the FAFSA is the first step in estimating potential aid for university students, which can include loans, scholarships, and work-study programs.

We emphasize the importance of comprehending the differences between federal and private student loans, as well as the terms and conditions that come with them. Scholarships and grants are also a significant part of financial aid, with scholarships being merit-based and grants need-based, both of which can substantially lower education costs.

Moreover, we guide students through the benefits of work-study programs, which provide part-time jobs that do not affect their financial aid eligibility. Our expertise ensures that students and their families are well-informed and prepared to make the best financial decisions for their educational future.

Alternative Funding Strategies

At Modern Wealth, we offer strategic financial solutions for funding education costs, utilizing various assets while considering their long-term implications. Home equity can be a tax-efficient option for homeowners, providing a potential source of funds through loans that may offer tax deductions. However, it’s important to consider the lack of flexibility should your financial circumstances change.

For parents considering using retirement savings, we advise a cautious approach. Tapping into 401(k) or Roth IRA accounts can have tax consequences and penalties, potentially impacting your retirement nest egg. It’s crucial to balance the immediate need for educational funding with the long-term goal of a secure retirement.

We also explore the use of permanent life insurance cash values as a flexible funding source. Borrowing against these policies can provide immediate funds without affecting financial aid eligibility, though it may reduce the policy’s death benefit. Our expertise ensures that you understand all options and choose the best path for your financial health and educational goals.

Let's Chat

Join us for a complimentary 30-minute chat focused on your needs, goals, and vision. Enjoy a relaxed, no-pressure session to learn about our process and ask any questions. We’re here to listen, not to sell. Let’s discover what’s possible together!