Yilmazer, T. (2008). Saving for children’s college education: an empirical analysis of the trade-off between the quality and quantity of children. Journal of Family and Economic Issues, 29(2), 307-324.
Brief Description: This paper examines the effect of children’s college expenses on household savings. Using the actual amount of parents’ financial support, the model estimates the expected expenditures on children’s college education and investigates the effect of expected expenditures on parents’ savings. The results show that households save in advance …
The fact sheet lists information on personal investment accounts; traditional Individual Retirement Accounts; Roth IRAs; 401(K) and 403(B) retirement plans; custodial accounts, such as a Uniform Gift to Minors; Coverdell Education Savings Accounts; 529 plans; and U.S. Savings Bonds.
Released March 26, 2009
COLUMBUS, Ohio — Parents who are trying to save for their children’s education but aren’t sure where to start may find guidance in a four-page fact sheet, “College Savings Options,” from Ohio State University Extension.
The fact …
In finance: A certificate representing a share of ownership in a company. Stock is the ownership of a corporation represented by shares that are a claim on the corporation’s earnings and assets. There are many kinds of stocks, the most widely known being common stock, which usually entitles a stockholder to vote in the election of directors and other corporate matters.
In viticulture: Grape variety used as the underground portion of a grafted vine onto which the scion…
A pooled investment vehicle; its securities are managed for a fee by a professional investment group.…
A term, derived from the most expensive chips in a poker game, used to indicate the stock of companies with long records of growth and profitability; i.e., the company has been growing and has been paying dividends for a long time.…
A report that public companies are required to file annually that describes the preceding year’s financial results and plans for the upcoming year. Annual reports include information about a company’s assets, liabilities, earnings, profits, and other year-end statistics. If the public can buy stock in a company, that company has to issue a report every year that explains how well it did in the past year and what its strategy is for next year. The report includes what the company …
The steps below suggest important actions for you to take to establish a solid foundation for future investing activity. Once completed, you will be ready to begin developing a personal investment plan.
Check each action step as it is completed.
- Review your current financial holdings and determine if they are in saving or investment vehicles.
- Determine the rate of return for your current financial holdings.
- Establish short-, intermediate-, and long-term financial goals for you and your family. Estimate the length
Investor A invests $2,000 a year for 10 years, beginning at age 25. Investor B waits 10 years, then invests $2,000 a year for 31 years. Compare the total contributions and the total value at retirement of the two investments. This example assumes a 9 percent fixed rate of return, compounded monthly. All interest is left in the account to allow interest to be earned on interest.
|| Investor A
|| Investor B
|| Year End Value
|| Year End |
Here is how time can work for you:
- The longer you invest, the more money you will accumulate.
- The more money you invest, the more it will accumulate because of the magic of compound interest.
Compounding works like this . . .
The interest earned on your investments is reinvested or left on deposit. At the next calculation, interest is earned on the original principal plus the reinvested interest. Earning interest on accumulated interest over time generates more and more …
Your Investment Goals
Goals are specific things (e.g., buy a car, put a new roof on the house) that people want to do with their money. As people move through various life stages, their needs and financial goals change. Your selection of investments should relate closely to your financial goals. Each goal will define the amount and liquidity of the money needed as well as the number of years available for the investment to grow.…