How a 529 Account Helps Make Saving For College Easy!

Saving for your child’s higher education is one of the most important investments you can make for their future. To make saving for college easier, the Qualified Tuition Program or the 529 plan was established. The 529 plan is a federal-income-tax-free savings plan to be used exclusively for qualified educational expenses.

Research shows that a college education can lead to increased income and better job prospects. Unfortunately, the rising cost of tuition has become a budgetary issue for many families. Tuition prices have jumped so much that if you want your child to graduate from college debt-free (or close to it) you better start saving now.

The benefit of subsidizing college with a 529 account are varied. Below are a few reasons worth considering:

College is expensive. The earlier you start saving, the more time you have for your savings to work for you. Even saving small amounts will eventually gain larger dividends down the road.

Cover more than tuition. A 529 account can be used to pay for all the costs associated with higher education, including textbooks, computers and other necessary materials.

Use towards technical education. In addition to tuition at public or private colleges, the 529 savings can be used towards trade schools. These types of educational institutions are becoming very popular mainly due to the increasing costs of traditional universities.

Tax benefits. The state of California offer tax-advantaged growth as well as a way to potentially shrink your taxable estate. While contributions to California’s plan are not deductible at the state or federal level, all investment growth is free from state and federal taxes, and the earnings portion of withdrawals for qualified education expenses are income tax free. Additionally, the California 529 plans allow individuals to contribute up to $15,000 per year per account without triggering any federal gift taxes or using any of your lifetime gift tax exclusion amount. The IRS Publication 970, “Tax Benefits for Education”, explains how to calculate the taxable portion of distributions. (Please consult your tax advisor regarding potential tax benefits).

Lower student debt. A 529 savings account can help ease the burden of student loans and lower the amount that is borrowed.

Flexibility. There are two different types of 529 savings accounts. A 529 plan permits you to move money around to different accounts within the plan. Keep in mind that each plan has its own set of rules, so do your homework before making changes that could unfavorably affect your investment.

• Prepaid tuition plans – These plans allow for the pre-purchase of tuition with money to be disbursed when the student enters college. These prepaid tuition plans are usually managed by state organizations or by colleges and universities themselves. Most of the time, the funds in these types of plans cannot be used for room and board.

AIG, Private Equity and Venture Capital

AIG: Maurice Greenberg’s piece in today’s Wall Street Journal nearly provoked an attack of apoplexy. I’m not sure if I’ve read such a slanted, self-serving editorial in a long, long time. I’m pretty shocked that the WSJ would publish such pandering drivel. Be that as it may, we all know that the Big Mo controls gobs of AIG shares both directly and through his management of CV Starr, so let’s just say that we know where he is coming from. When he starts out with the bailout-inconsistency argument, he kind of had my ear. But when he went on to praise the Citigroup package while chastizing the AIG deal, I couldn’t help but call bull$hit.

To date, the government has shown everything but a consistent approach. It didn’t give assistance to Lehman Brothers. But it did push for a much-publicized and now abandoned plan to purchase troubled assets. The government also pushed for a punitive program for American International Group (AIG) that benefits only the company’s credit default swap counterparties. And it is now purchasing redeemable, nonvoting preferred stock in some of the nation’s largest banks.

The Citi deal makes sense in many respects. The government will inject $20 billion into the company and act as a guarantor of 90% of losses stemming from $306 billion in toxic assets. In return, the government will receive $27 billion of preferred shares paying an 8% dividend and warrants, giving the government a potential equity interest in Citi of up to about 8%. The Citi board should be congratulated for insisting on a deal that both preserves jobs and benefits taxpayers.

But the government’s strategy for Citi differs markedly from its initial response to the first companies to experience liquidity crises. One of those companies was AIG, the company I led for many years.


The maintenance of the status quo will result in the loss of tens of thousands of jobs, lock in billions of dollars of losses for pension funds that are significant AIG shareholders, and wipe out the savings of retirees and millions of other ordinary Americans. This is not what the broader economy needs. It is a lose-lose proposition for everyone but AIG’s credit default swap counterparties, who will be made whole under the new deal.
The government should instead apply the same principles it is applying to Citigroup to create a win-win situation for AIG and its stakeholders. First and foremost, the government should provide a federal guaranty to meet AIG’s counterparty collateral requirements, which have consumed the vast majority of the government-provided funding to date.


The purpose of any federal assistance should be to preserve jobs and allow private capital to take the place of government once private capital becomes available. The structure of the current AIG-government deal makes that impossible.

The role of government should not be to force a company out of business, but rather to help it stay in business so that it can continue to be a taxpayer and an employer. This requires revisiting the terms of the federal government’s assistance to AIG to avoid that company’s breakup and the devastating consequences that would follow.
Hank, you’ve got to be kidding me. The U.S. taxpayers saved Citigroup’s life, and for that we may get up to 8% of the company. THAT is called a “punitive program” in Hank’s parlance for the U.S. taxpayer. In my world when you save a company you own ALL the equity, not 1/12th of the equity. The fact that the taxpayer gets up to 80% of AIG – now that starts to make sense. I agree with the Big Mo’s contention that “The purpose of any federal assistance should be to preserve jobs and allow private capital to take the place of government once private capital becomes available.” But that has nothing to do with post-restructuring equity ownership. He then pulls on the heartstrings by saying “The maintenance of the status quo will result in the loss of tens of thousands of jobs, lock in billions of dollars of losses for pension funds that are significant AIG shareholders, and wipe out the savings of retirees and millions of other ordinary Americans.” Well, Hank, that is 100% on you. YOU should have thought things through before building a company and a culture that gambled it all – and lost. You tell that retiree, that pensioner how you screwed them. That’s called integrity. This thinly-veiled call for personally getting bailed out is both insulting and offensive. And I’m not buying it. I’m sure that my fellow U.S. taxpayers aren’t, either.

Private Equity: The daisy chain of secondary sales of PE L.P. interests will almost certainly accelerate. It is one of those slow-motion train wrecks that is painful to watch. The calculus is easy to understand: public equity values plummet, PE values are stickier and fall more slowly, PE as a percentage of overall assets rises to unacceptable levels, precipitating a wave of sales of PE L.P. interests. An interesting feature of this dynamic is autocorrelation, where PE values are slow to adjust notwithstanding the public market comparables that are available. If industrials are down 40%, then don’t you think a portfolio of PE holdings in the industrials sector should trade well beyond 40% down due to illiquidity? This isn’t the way many PE funds choose to see the world, however. Regardless, the secondary market is just that – a market – and the discounts being placed on marquee funds like KKR and Terra Firma reflect this reality. Pensions and endowments have to dump stuff, and are trying to do so at a fraction of their basis. But even at fire-sale prices it is hard to move the merchandise. In the next few months we’ll see just how desperate these investors are. Might we see KKR trade at 30 cents on the dollar? It’s possible. And frightening.

Venture Capital: I attended an interesting brownbag today with my pals at betaworks. A big part of the discussion was around funding in today’s hostile environment. Here are a few of the tidbits that came out of the dialogue:

Be prepared to live with your current investment syndicate.
If possible, have a deep pocketed investor as part of your syndicate.
Raise 18-24 months of capital, no less. This can be done through a combination of capital raised plus a reduction of operating burn.
Restructurings are getting ugly. Investors, whether inside or outside, are demanding both haircuts from the last round plus and a priority return of capital such that they are fully repaid before anyone else gets anything. Looks, smells and feels like a cram down. This is why having 24 months of capital in the bank upfront is so important.
In these down times coalitions get formed between Management and New investors vs. Old investors. This mis-alignment of interests can lead to gridlock and push a company to the brink.

Why Developing an IOS App Is a Valuable Investment for Your Business

While both Android and iOS mobile apps are equally powerful in making a business globally visible to the audience, it is an iOS that can give you more benefits, if you think of long-term. As per Statista reports, the world accounts for more number of Android users apps (nearly 2.5 million) than iOS apps (which is approximately 2 million). So, eventually, for the appreneurs and marketers, Apple’s App store comes second after Google’s Play Store in terms of popularity. Businesses that want to fetch a vast user base, an Android app is a perfect choice. But, if you want your app to not only seek the right users but also offer hem quality experience, then an iOS app is the thing for you. Here we have further discussed for you several factors to help you better understand why investing in an iOS app is better for your business.

The brand name says it all

One prominent reason to put an iOS app at the forefront of your business is its unique ‘brand identity’. For years, Apple holds the legacy to deliver high-quality phones and tablets. As the clear winner in the market with high brand reputation, Apple devices capture the attention of the elite segments of the population.

Smooth UX/UI of iOS devices

Undeniably, Apple masters at designing and developing the most flawless user experience for every device. Everything from the graphical interface, screen layout, animation standards to navigation are designed keeping in mind the users’ expectations. This makes all iPhone and iPad versions are highly performance-driven and hence an iOS app can offer much better customer experience.

Help you compete better

An iOS app will assist you better to stand out in the competition. From helping you to connect with your customers to increase your brand reputation, it makes your business unique from the competitors. Apart from that, every iOS device comes with excellent quality standard and innovative features which will help the app to deliver its services to users in an extraordinary way.

Number of users for iPhones are growing day by day

Even though the statistics show a larger number of Android devices than iOS, the data of the number of iOS users are reflecting an increasing trend. This means, your iOS app will see its user base growing eventually in the long run.

Enhanced level of security

There’s no question regarding the level of security offered in the Apple devices. It offers top-notch security and assurance of data privacy. This is considered to be the best aspect of using iOS. So, for apps that seek to collect information from customers, support payment facilities and facilitate data transfer, iOS is the right platform to go with. ‘

No matter how much Android has been successful in acquiring users worldwide, iOS has its distinct user bases and that will set your app apart from the rest if its built for iOS. Specified as the best mobile platform, it will help your business gain a strong digital presence and grow the revenues by meeting every user expectation in the right way.

Rob Stephen is a techie, writer and professional app developer at GetAProgrammer, an industry-leading company for iOS app development in Sydney. It has delivered about 100+ impressive apps for businesses that helped them stand out in the market and become more profitable. He loves trekking, touring the world and in the free time, likes to scribble stories on his notebook to generate ideas.