The most important thing you can do to get ready for college costs is to save -- early and often.
But saving for college can be bit of a maze. Like retirement, there are several different types of plans, like a pre-paid plan which lets you buy a percentage of tuition in advance, or a 529 plan, which lets you invest money and let it grow without a big tax bill when you start using the money.
Kimberly Lankford, contributor to Kiplinger Personal Finance, says 529 savings plans are one of the best ways to save for college. "The money you put in may be tax-deductible, the key thing is the money grows tax-deferred for years and years, and when you finally use it for college expenses, it's tax-free."
And how much should you start with? "Nothing is too early. As soon as you have a baby born, even if you got just a little bit, [saving] that would be great. A lot of these plans let you invest just $25 or $50," Lankford says. She also notes that many plans can automatically take investments from your savings account. This type of 'set-it-and-forget-it' approach is an easy way to start saving.
Lankford notes that you should check to see if your own state offers a tax deduction for investing in its 529 plan. SavingForCollege.com can be a good resource to compare the 529 plans available.
Not all 529 plans are great. Since the money is invested in mutual funds, it's important to look out for fees and the holdings of each fund. "Especially after 2008 [and the financial crisis], there's been criticism of some of these age-weighted funds where they start out of more aggressively and gradually get more conservative," Lankford says. "Some of these didn't get conservative fast enough."
One alternative to a 529 plan is a pre-paid tuition plan. "With a 529 plan, your money is invested in mutual fund and grows through the years. A prepaid plan on the other side has you using today's dollars to buy [a future share of] tuition. You can set aside a certain amount of money now, and that will guarantee you get a certain share of tuition down the road."
But prepaid plans also have drawbacks. Unlike a 529 savings plan, you're usually locked into only using your savings in the same state you invested in. A 529 plan lets you use that money for any college.
Lankford says, "the key thing is for the person with a newborn or a child in elementary school, they still have many years until the child starts college. Don't get freaked out about the short term blips."
The NFL hopes this is a storybook ending. And, in some ways, you could make the case it is. There is a lot of talk about how the NFL could have ended up paying as much as $2 billion in damages if the case had gone forward. Not only are they getting off the hook financially, but more importantly perhaps the league has admitted no wrong-doing. Had the case proceeded to trial, lawyers would have deposed NFL executives, finding out what they knew about concussions and brain injuries, and when they learned about it.So was this a win for the NFL? It depends how you see it. Settling the case takes a lot of wind out of all the media stories about head trauma over the last 18 months. The NFL hopes to make this all disappear. But the reality is, since this case came out, something has changed. We all know more about the lifetime effects of some of these crushing hits. There is still an outstanding lawsuit with helmet manufacturer Riddell. And, even with more precautions being taken, football is still a violent game. Players are still going to get hurt. That’s not going away. And neither is this issue.
When the economic history of the decade is written someday, there very well may be a chapter about the spring and summer of 2013, when money that had been pouring into emerging market countries shifted the other way. Recently, the economies of emerging markets are looking dismal with both currencies plummeting in value against the dollar.
Capital flowed into emerging markets when interest rates dropped in the U.S. and Europe during the 2008 financial crisis, but as those economies rebound, investors are turning the other way.
"Investors are seeing the prospect of reduced Federal Reserve intervention in the U.S. -- which will tend to raise long-term interest rates in the markets -- and they want to get some of those better returns," says Andrew Walker, the BBC's economics correspondent. "In the process, they are selling money in emerging financial markets, and that has been driving the currencies down and the interest rates up."
The White House is expected to soon release more of the evidence it says it has to support the case that the Assad regime used chemical weapons against its own people. Despite the news that Britain won't be joining in any military action, the Obama administration seems determined to go ahead.
For two hours yesterday, service on the New York subway's B and Q lines was stopped in Brooklyn as transit employees searched for two kittens that got down near the third rail. Kittens are now safe. Now you may be prompted to do some kind of cost-benefit analysis about kittens versus lost productivity of stranded train riders. Before you do, consider the photo The New York Post took of one of the little guys, peering out w ith his fluffy face and green eyes, his little nose obscured by the track. Where's that fit into your ruthless spreadsheet?
Called by some the best Irish poet since Yeats, Heaney was 74. He was awarded the 1995 Nobel Prize in Literature. Heaney once told NPR that poems are "stepping stones in one's own sense of oneself. ... You have to conjure the next stepping stone because the stream, we hope, keeps flowing."
It's quiz time on Marketplace Tech. 306,000 tweets per minute, 2 (think gaming), 11,000 requests, and 74 percent: Can you guess what these numbers mean?
We put Amanda Wixted, owner of Meteor Grove, the company behind some of the most popular mobile video games around -- like Farmville and Mafia Wars -- to the test for our latest edition of Silicon Tally. Click on the audio player above to play along.
How to pay for college is one of the big financial issues that families face. That leaves a lot of parents and students wondering why college costs are rising, and whether a college degree is worth the cost.
Has the cost of college gone up that much?
The cost of college has been rising, but not as much as people think, according to David Leonhardt, the Washington Bureau Chief for the New York Times.
“It’s gone up faster than inflation, but when you take financial aid into account, it’s gone up only modestly faster than inflation,” said Leonhardt.
A lot of people, he said, are confused because they're looking at the "sticker price" for college, not realizing that many students get financial aid that reduces what they have to pay.
He compared that aid to a progressive tax system, where high-income students pay a higher rate than low-income students.
"I'm not sure we should be that concerned about that," said Leonhardt. "The rich have done so well over the last couple decades, getting enormous raises, that they can afford a higher college bill than they could 20 years ago.”
Is paying for college still worth it?
According to the Federal Reserve, the average amount of student loan debt for a 2013 graduate was around $28,000, while the average salary for new grads in 2013 was $44,928.
Leonhardt says graduates need to look beyond their first year salaries when they think about paying off debt.
“Compare $28,000 not to what you make your first year out of college. Compare it to the difference over 5 or 10 or 20 or 40 years, between what a college graduate earns and what someone who doesn’t graduate from college earns,” said Leonhardt. “Then the amount of debt we have, while not great, seems to look less bad.”
Will there be pressure on universities to lower education costs?
Leonhardt identified two forces that could drive college costs down.
The first is technology. If online colleges prove they are effective, he said, traditional schools will have to adjust their prices.
The second is the cost of social security for retiring baby boomers. The pressure on the federal budget, said Leonhardt, will push the government to make colleges more accountable for how they spend federal dollars.
This month, President Obama proposed measures to make colleges more accountable, by tying aid to student success.
That could make a difference, said Leonhardt. “We don’t say ‘Hey, if you actually do a good job and your students learn something, or if you do good job and they graduate, we will give you more money than a school that is enrolling tons and tons of students and having many of them fail and drop out,’" he said.
This final note today, in which the tooth fairy and inflation both figure prominently -- so parents, please act accordingly.
A new survey out by Visa shows the average kid in this country gets $3.70 a tooth.
There are some regional variations: When the tooth fairy visits the northeast she goes a little crazy: $4.10 a whack.
Kids in the Midwest get stiffed, relatively speaking, at $3.30 per tooth.
On a recent Monday evening, a computer literacy class at the Benjamin Franklin branch of the Los Angeles public library was packed with a dozen adults, some of whom were getting online for the first time in their lives.
"In [this] community, there usually isn't computer access or internet access at home," said librarian Mari Jack. She, along with computer aide Martha Flores, who translates the lesson into Spanish, are focusing today on how to download free music and movies using library resources.
At times, the students struggle. Alfonso Rodriguez, 62, can't remember the last four digits of his old phone number. They serve as the PIN to his library account and without them, he can't log in. Flores advises him to check at the main desk and he darts out to avoid missing too much of the lesson.
Rodriguez, who works for the Los Angeles Unified School District, says he has recently begun using a computer in his workplace for the first time in his life. He's a food service worker and he has to keep records of the number of children who buy lunch at school. He discovered the internet a few years ago. He says he's enthralled by the way it allows him to research any topic that catches his interest.
"I just go to Google, and pick a topic and put it in, and I'm off," Rodriguez said. He has his own laptop, but can't afford to pay for internet access at home, so he comes to the library or goes to McDonald's to use the wifi.
Many in the class recognize that computer literacy is necessary for anyone hoping to get -- or keep -- a job.
Joanne Mestaz, who has been unemployed for several years and cannot afford to buy a home computer, started coming to the library so her son could do his homework. She quickly realized that free computer classes could benefit her. Mestaz graduated from college in 1993, when knowing how to use a word processor was enough and computer literacy was considered extra.
"I do wish I would have tried to learn," Mestaz said. "I do feel behind. I know that [computer literacy] is a factor in the job market."
Data from the Pew Research Center's report, Home Broadband 2013, would suggest that low-income, predominantly-Hispanic Boyle Heights, is exactly the kind of neighborhood where computer illiteracy might be prevalent.
"Adults that don't have broadband at home tend to be older or have lower levels of education," said Pew researcher Kathryn Zickuhr. "[They have] lower levels of household income."
The librarians at Benjamin Franklin say that on an average day, the library is packed with people using the computers to look for work -- or learning to use the computers for the same purpose.
"Knowing how to type on a keyboard and use a mouse is now becoming a survival skill," said Senior Librarian Alicia Moguel. She remembers one man who was trying to find a job as a cook. He learned, in a computer class, how to write a resume, but then forgot how to open the file.
"I was able to open his resume and he's like 'Oh, thank God. I have to go to an interview,'" Moguel said. "And sure enough, he found a job in Long Beach and we rarely see him anymore. But that's a good thing because he needed to work. He needed to get a job."
A recent report out on student loans says that we owe more money than ever before. Five years ago, 47 percent of students received federal financial aid -- now that number is up to 57 percent. If you include private loans and grants, that number jumps to 71 percent.
We owe Uncle Sam $1.2 trillion right now. But $214 billion of that is in deferment or forbearance and $89 billion is in full-on default, which means that about one-third of loans out there right now are not being paid.
Will all that cash involved, many might think that the feds are earning money. That's hard to figure out. In 2013, the U.S. government is probably spending about $7 billion more on student loans than it is taking in.
But since the loans can sometimes take 30 years to pay off, it isn't that helpful to just look at one year when trying to determine how much money the government actually makes. Another issue with figuring out the exact figure? People estimate revenue in different ways. Read more here.
If you live in Colorado and flip on your TV next month, you may catch an ad from R.J. Reynolds. That's where the tobacco company of Camel fame plans to air its first commercial since 1971.
That was the year the Nasdaq debuted, Nixon installed a secret taping system in the White House and the U.S. government banned cigarette ads.
Now, they’re back, but not for tobacco products. R.J. Reynolds is returning to the broadcast market to promote its electronic cigarette Vuse.
A number of smaller e-cig players have already been airing ads. Blu eCigs features Jenny McCarthy in its commercials.
“You know,” says, McCarthy, in a new ad bound for TV, but already available on YouTube, “I love being single. But here’s what I don’t love, a kiss that tastes like an ashtray -- blechhh. I’m Jenny McCarthy and I’ve finally found a smarter alternative to cigarettes.”
Sales of e-cigs in the U.S. have topped $1 billion this year. It’s only a fraction of the overall cigarette market, but sales are growing fast. So far e-cigs have been dominated by smaller companies.
“I think coast to coast you’ll probably see blu eCig commercials, maybe a little bit of Njoy,” says Tom Mullarkey, an equity analyst with Morningstar.
Meanwhile, big tobacco has been cautious. E-cig ads target smokers, and Mullarkey says companies don’t want to undercut traditional cigarettes, which are much more profitable. The caution extends even to the content of the ads.
R.J. Reynolds’s commercial for Vuse is “modest” and “vague,” says Shane MacGuill, a tobacco analyst with Euromonitor International.
“If you watch it, it takes you the majority of the ad itself to work out what the product is,” he says.
Unlike McCarthy’s spot for Blu, which shows her puffing away, the Vuse ads features shooting stars, sunsets and skyscrapers, but no actual smoke or smokers.
Some cigarette sellers, notes MacGuill, are being careful not to attract regulators’ attention.
It was 50 years ago this week that the Moscow-Washington Hotline, known popularly as the “red phone,” was established. The red phone never existed but the technology that allowed the Kremlin and Washington communicate directly did, and it’s advent signaled a thawing in the Cold War.
But let’s back up. The catalyst for the hotline was the Cuban Missile Crisis in 1962. For 13 days, the world teetered on the brink of a nuclear war. And as mind-boggling as this sounds, during the crisis, there was no way for President John F. Kennedy to communicate directly with the Soviet Premier Nikita Khrushchev, said James Hershberg, a history professor at George Washington University. “In order to send a message, they literally sent it by Western Union,” Hershberg said.
And that took hours. President Kennedy would send his note to the Soviet Union’s embassy in Washington, DC, where they’d transcribe it. Then, they’d dispatch a bicycle messenger to take the note to Western Union. Khrushchev went through a similar process on his side. But as tensions mounted, it became clear that this outdated way of communicating could have catastrophic consequences. So, at the brink of war, Khrushchev ditched Western Union and went on the radio. “The message resolving the crises in which Khrushchev agreed to withdraw the missiles was broadcast over Radio Moscow,” said Hershberg.
Khrushchev was afraid that -- if he took the Western Union route -- Kennedy might miss his message and dispatch ships to Cuba, which could have set-off a nuclear war. And so the hotline was born, said Steve Weber, a professor at UC Berekeley.
“There was never a red phone,” Weber said. The super powers stuck to the written word and used teletypes. The thinking was that on the phone tempers could flare and words might get lost in translation. Weber says the hotline was a signal that that relations between the two superpowers was thawing. And perhaps more importantly, it gave people hope. “I think it symbolized a shared belief that neither one of these countries wanted a nuclear war,” he said. And that they were taking concrete steps to prevent it.
Many obstetricians make more money for C-sections than for vaginal deliveries. In a recent study, these doctors were more likely to perform the costly procedure than doctors paid a flat salary. But when the pregnant women were also physicians, doctors seemed less swayed by financial incentives.
Just about every culture has dumplings. For the Polish, it's pierogi, and as Morning Edition editor Renita Jablonski writes, this little dumpling plays a big role for many Polish-Americans in preserving and celebrating their heritage.
A decade ago, cranes that had never before migrated followed the lead of an ultralight plane to learn the route south. Several generations later, old cranes are teaching young birds to navigate that same route. It's a clue that migration is a combination of nature and nurture, researchers say.
On Friday, embattled Mayor Bob Filner officially steps down. Allegations of sexual harassment against Filner have rocked the eighth-largest American city. Now, San Diegans face a potentially contentious special election in November.
A father prepares to hand over the family business — a funeral home — to his daughter. The business has been in the family for more than a century and she'll be the fourth generation to run it.
Laying the groundwork for a possible military strike, the Obama administration briefed Congress on Thursday. It told them it had intelligence that proved President Bashar Assad was responsible for a chemical attack on his people.