Tips for Saving for College

Having a college degree is vital in today’s economy because a degree means higher wages, more career opportunities, greater job satisfaction and other benefits. But as college costs continue to increase it’s more important than ever to start saving for your children’s future as early as possible. These tips can help you get a head start and put your student on a path to higher education that leaves them with as little student debt as possible.

Put Yourself In The Right Financial Position To Start Saving

Parents are encouraged to start saving for their child’s college fund as early as possible, but before you do it’s important to make sure you’re in the right financial position. Paying off credit card or your own student loan debt, establishing an emergency savings account, as well as saving for retirement are important financial milestones to complete before establishing a college fund. Completing these milestones will help put you in the right financial position to start saving.

Research College Costs

With college costs continuing to rise, it’s important to make sure you’re saving enough to cover your future student’s tuition, living expenses, materials and fees. Researching and comparing the costs of attending public colleges both in and out of state with private universities and community colleges gives you an idea of what kind of costs to expect. This allows you to determine a time frame and budget.

Explore Different Savings Options

There’s a variety of different savings options available to start your college fund, and researching available plans will help you find the one that’s right for you. Education Savings Accounts (ESA) offer parents the opportunity to save $2,000 per year, per child that grows tax-free. While the money can be withdrawn tax-free when it’s ready to be used, you must meet a certain income limit to qualify and contributions are limited to $2,000 a year.

529 plans are an alternative to those looking to contribute more than $2,000 or don’t meet the income limits of an ESA. The high contribution rates offer the opportunity to quickly meet your goal and like the ESA, your money grows tax-free. While 529 plans provide parents great saving opportunities for a single child, restrictions may apply if the parents decide to transfer the funds to another child.

Find Out If You Qualify for Certain Tax Breaks

Qualifying for available tax breaks helps provide you with more money that can be put toward educational costs. If you’re eligible for the American Opportunity Tax Credit, you can get a credit of up to $2,500 that covers certain educational expenses while the Lifetime Learning Credit covers costs other than tuition and books including activity fees.

For help with questions about the best ways to save for your child’s future, contact an experienced accountant like the ones at Donohoo Accounting Services. Schedule a free consultation at 513-528-3982 or email us today. And don’t forget to check us out on Facebook, Twitter or LinkedIn for our latest updates!

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10 Tips for Navigating Open Enrollment

Beginning each fall, many employers kick off their open enrollment period. This is a time when employees have the opportunity to enroll in — or make changes to — their health insurance benefits. As the open enrollment season approaches, now is an excellent time to review your current health insurance coverage, determine what benefits or funds you have left to use before the close of the coverage year, and consider your insurance needs for the upcoming year.

Basic Information Required

If you are a new benefits enrollee or if you are making changes to your medical coverage, you will need some basic information for the family members you wish to cover. You will need to have Social Security numbers and birthdates of the family members you will be covering. Additionally, if any of your family members are covered by secondary health insurance plans, you will need to have those policy numbers and the name, birth date, and Social Security number of the policyholder.

Current Providers and Medications

To accurately compare your current coverage with the insurance plans you have to choose from during open enrollment, make a list of the names of your current healthcare providers. Include doctors, specialists and hospitals or healthcare systems for each family member to see if they are included in your employer’s benefit plan network. Also, gather a list of regularly-taken medications for each family member – the name and dosage – as well as the name and address of your preferred pharmacy. Knowing your co-pays and other out-of-pocket costs will be key to determining the correct plan for you and your family.

Summary of Benefits

Review the benefit plans’ summary of benefits and comparison tables if more than one option is available to you. Be sure to compare the procedures and medications that are covered, and not covered, by each plan. Also consider each plan’s level of coverage for preventive care, such as annual physicals, mammograms and well-child visits.

Cost Comparison

Estimate how much you can afford to spend on healthcare in a year and compare the premiums, deductibles and co-pays. Then, total what you spent in the previous year on doctor visits and medicine. Remember to list annual or seasonal doctor visits and treatments for chronic conditions like asthma, as well as behavioral health costs for therapy or counseling. If your records are inaccurate, use an online healthcare cost calculator to help you estimate your spending.

Also consider co-insurance costs (for health insurance plans that have separate prescription drug plans), and your annual spending using your medical savings account (MSA) or flexible spending account (FSA). To predict your MSA/FSA spending for the coming year, total your costs for over-the-counter medications, chiropractic care, vitamins/supplements, and alternative medicines and treatments. If your unused MSA/FSA funds don’t roll over, be sure to use them before your spending deadline.

Could you use some assistance making decisions about the costs of healthcare during open enrollment season and how it can impact your other financial needs? An excellent resource is an experienced accountant like those at Donohoo Accounting Services. Schedule a free consultation at 513-528-3982 or email us today.

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The Best Time To Buy Household Appliances

Major household appliances are expensive, but knowing the right time to buy them can help save you and your family money. You might think Black Friday is the best time to buy nearly everything, and there are great deals available, but to get the best deals of the year, September is the right time.

During September, many stores are looking to clear out existing inventory to prep for the holiday shoppers, and manufacturers often release new models in late fall. This combination leads to the best prices of the year for most washers, dryers, dishwashers, ovens/ranges and refrigerators.

Energy Star Rebates

There is also plenty of rebate money remaining for Energy Star certified appliances. Before you buy, visit the site and type in your zip code to find rebates and special offers near you. Products that earn the Energy Star label meet strict energy-efficiency specifications set by the U.S. Environmental Agency, which helps save energy while protecting the environment. These products also increase your home’s resale value, so it’s a win all around.

Price Matching

Once you’ve done your research about product models and determined your additional rebate savings, take it one step further with price matching. Every retailer has different rules, but one we like best is Best Buy. Here’s why. Best Buy matches prices with H.H. Gregg, Walmart, Lowe’s and even among others. Once you make sure the product is identical in brand, color and model number, present the deal in-store or online and they will match the price. After your purchase, keep an eye on the item. If Best Buy lowers the in-store or online price during the return and exchange period, they will match that lower price again, upon request.

Sell Your Old Item

Not only are the prices for your new item lower, but you will also be able to sell your old appliances easy and faster on sites like NextDoor. Many people like selling on NextDoor versus a site like Craigslist because you can sell to only people in your neighborhood, and you can check their post history to get to know someone a bit before inviting them into your home to pick up their purchase. If you’re not looking to resell your appliances, consider a donation. The Salvation Army will come to your home to pick up a donation and give you a receipt for tax purposes.

The professionals at Donohoo Accounting Service are here to help you manage your finances. We have been helping people like you to wisely manage their finances for more than 20 years. For a free consultation, call us today at 513-528-3982. Check us out on Facebook, Twitter or LinkedIn for our latest updates!

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Five Best Personal Credit Cards

The personal credit cards of today are not your father’s credit cards. By far, 21st-century personal credit cards tend to offer a variety of benefits to consumers that provide convenience and discounts not offered by paying cash or even with the use of a debit card. And while personal credit card offers abound – online and in your mailbox – five of the best personal credit cards are outlined for you here.

Capital One Quicksilver Cash Rewards Credit Card

While this credit card’s TV commercials and marketing tagline are popular, some features that make it popular among consumers include unlimited 1.5 percent cash back on every purchase made, no annual fee, and a one-time $150 cash bonus when you accrue $500 in purchases during your first three months as a cardholder. Additionally, the 0 percent introductory APR for 15 months applies to both your account balance and balance transfers.

Wells Fargo Propel American Express Card

If you’re a person about town, you can rack up triple points (to earn discounts or “miles”) when you eat out, use rideshares and transit, buy gas and use eligible streaming services. All other purchases earn 1 point per dollar. Additional advantages include 30,000 bonus points upon making $3,000 in purchases within three months, 0 percent introductory APR for 12 months, cell phone protection and no annual fee.

Chase Sapphire Preferred Card

To satisfy the traveler in you, the Chase Sapphire Preferred Card gives you double points/miles on travel purchases such as airfare, hotels, dining and transportation; all other purchases earn one point per dollar. When you make $4,000 in purchases within the first three months, you’ll earn 60,000 bonus points. No fees on foreign transactions. The annual membership fee is $95.

Discover it Cash Back

For those who prefer getting cash back on their purchases, the Discover it Cash Back credit card offers up to 5 percent cash back on purchases made at grocery stores, gas stations, restaurants and You’ll also tally 1 percent cash back on all other purchases. As an added bonus, Discover will match all the cash back you earn at the end of your first year as a cardholder – with no limit. That’s free money! You can also transfer balances at the introductory APR of 0 percent for 14 months. This card has no annual fee.

Citi Double Cash Card

The Citi Double Cash Card offers a unique way of rewarding you not only for using the card for purchases but also for making your monthly payments. You can earn 2 percent cash back on all purchases: that’s 1 percent when you buy and another 1 percent when you pay. There are no expense categories to track, no caps on cash back and no annual fee. The introductory balance transfer APR of 0 percent is good for 18 months.

For more than 20 years, Cincinnati’s most trusted accountants, Donohoo Accounting Services, has helped individuals like you wisely manage their personal finances. Contact us by calling 513-528-3982 or email us today. And don’t forget to check us out on Facebook, Twitter or LinkedIn for our latest updates!

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