Category Archive: College

My Check From Upromise Arrived

As I mentioned a few months ago, I recently sent a letter to Upromise, requesting a withdrawal from my account. I am proud to say, I received a check from Upromise last week, and I’ve now deposited that check into my savings account.

I have been using Upromise to earn reward dollars for more than five years.  Instead of investing my reward dollars with a 529 Plan, I withdraw my reward dollars, once a year, and deposit them into my savings account. Please click here to read more about how to request a withdrawal from Upromise, and here to sign up while UPromise is giving away 500,000 for College.

For someone like me, who doesn’t use credit cards, Upromise is a great way to earn a few extra dollars.  I like the fact that I can register my grocery cards (those little things that hang on my keychain), scan those cards at the grocery store, and even when I pay cash, I’m still earning rewards.

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Sticking With TD Ameritrade

I mentioned in the last article that I would be opening two Education Savings Accounts – one for my son and one for my daughter.  I had been planning to open the accounts with Vanguard – the same brokerage that has my SEP-IRA – but I’ve decided to stick with TD Ameritrade – the brokerage where I already have my oldest daughter’s ESA.  While I really like Vanguard’s services, TD Ameritrade offers ESAs with no minimum contributions.  Vanguard, on the other hand, requires a $1000 minimum initial investment.  Right now, I just don’t have $2000 (for 2 accounts) sitting around,  and I don’t want to wait to open the accounts.  TD Ameritrade offers several no-transaction-fee index funds, my preferred investment options.

Strangely, TD Ameritrade does not allow users to open ESAs online.  Instead, you must print (or request by mail) account application forms and then mail them back to TD Ameritrade.  I printed out two sets of the forms, one for my son and one for my daughter, and I’m going to mail them tomorrow.

It feels good to have this done.  Now, all I have to do is fund the accounts!

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Retirement And Education Savings Goals

Here are my after-tax retirement and education savings goals for 2008/2009/2010. Contributions to Roth IRAs and ESAs can be made from December of one year until April of the next year. I have three children, and I have five months to fully-fund 2008 ESAs for each of them. I’m not sure if I’ll be able to afford to do this, but I’m going to try. Also, my wife needs to fully-fund her Roth IRA for 2008. Once those accounts have been funded, we’ll get to work funding 2009 accounts. The chart should clarify. (Chart corrected.)

Month ESA 1 ESA 2 ESA 3 Roth 1 Roth 2 Totals
Dec 2008 $400.00 $400.00 $400.00 Funded $1,000.00 $2,200.00
Jan 2009 $400.00 $400.00 $400.00 Funded $1,000.00 $2,200.00
Feb 2009 $400.00 $400.00 $400.00 Funded $1,000.00 $2,200.00
Mar 2009 $400.00 $400.00 $400.00 Funded $1,000.00 $2,200.00
Apr 2009 $400.00 $400.00 $400.00 Funded $1,000.00 $2,200.00
Totals $2,000.00 $2,000.00 $2,000.00 Funded $5,000.00 $11,000.00
May 2009 $166.67 $166.67 $166.67 $416.67 $416.67 $1,333.33
Jun 2009 $166.67 $166.67 $166.67 $416.67 $416.67 $1,333.33
Jul 2009 $166.67 $166.67 $166.67 $416.67 $416.67 $1,333.33
Aug 2009 $166.67 $166.67 $166.67 $416.67 $416.67 $1,333.33
Sept 2009 $166.67 $166.67 $166.67 $416.67 $416.67 $1,333.33
Oct 2009 $166.67 $166.67 $166.67 $416.67 $416.67 $1,333.33
Nov 2009 $166.67 $166.67 $166.67 $416.67 $416.67 $1,333.33
Dec 2009 $166.67 $166.67 $166.67 $416.67 $416.67 $1,333.33
Jan 2010 $166.67 $166.67 $166.67 $416.67 $416.67 $1,333.33
Feb 2010 $166.67 $166.67 $166.67 $416.67 $416.67 $1,333.33
Mar 2010 $166.67 $166.67 $166.67 $416.67 $416.67 $1,333.33
Apr 2010 $166.67 $166.67 $166.67 $416.67 $416.67 $1,333.33
Totals $2,000.00 $2,000.00 $2,000.00 $5,000.00 $5,000.00 $16,000.00
Grand Totals $4,000.00 $4,000.00 $4,000.00 $5,000.00 $10,000.00 $27,000.00

To be frank, I would love to fully-fund all 2009 accounts during the 2009 calendar year, but that might not be a realistic goal. Remember, while I’m working to fund these after-tax accounts, I’m also trying to fund my before-tax 403(b) and save for a future home purchase.

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Retirement And Eduction Savings Contribution Limits For 2009

As I sat down with my wife to talk about our financial goals for 2009, I realized that I needed to know if the contribution limits for our retirement and education savings accounts were going up in 2009.  After some searching, of both the Internet in general and the IRS website in particular, here’s what I found.  (By the way, if anyone from the IRS is reading this, it would be VERY helpful if you could create a single, easy-to-find page where all of these limits, and the limits for other types of accounts, could be listed.  Also, if such a page already exists, hook me up with a link, please.)

2009 Contribution Limits for 401(k), 403(b), and 457(b) Accounts:

$16,500 – Elective Deferrals (employee contributions)

$5,500 – Catch-Up Contributions (over 50 years of age)

$49,000 – Total Contributions Limit (employee + employer)

For more information and details, please see the following resources -

IRS 401(k) Resource Guide

401(k), 403(b) and 457(b) Contribution Limits For 2009

2009 Contribution Limits for Roth IRAs and Traditional IRAs:

$5000 – under 50 years of age

$6000 – over 50 years of age

Roth and Traditional contribution limits were unchanged from their 2008 limits.

2009 Contribution Limit for ESAs (Education Savings Accounts):

$2000

ESA contribution limit was unchanged from 2008 limit.

I’ll keep these limits in mind as I think about my 2009 goals.  As it looks now, more than 50% of our gross income will be allocated for retirement and education savings.  I’ll let you know, in just a bit, what we decide to do.

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