GA Education Update, Financial Leftovers, and Sex, Drugs & Hedge Funds?!

December 17, 2007

Georgia Education Update:
If you are a Georgia listener then Christmas has come early this year. As of December 11th the GA 529 plan has been drastically improved (probably because of the pressure of competition between the different 529 plans). The big improvements included:

** Georgia state income tax deduction update – For tax years beginning on or after January 1, 2007, contributions to an account are deductible up to $2,000 on behalf of any Beneficiary for Georgia income tax purposes. A Georgia taxpayer is not required to itemize his or her deductions to make this adjustment to income. Furthermore, there are no longer annual income limitations to claim this deduction.

** New Investment Options – Effective December 11, 2007, the Path2College 529 Plan will add the 100% Fixed-Income Option. Effective March 10, 2008, the Plan will also add the Money Market Option.

** Lower Fees – Total annual asset-based fees for each of the previously available Investment Options have decreased from .78% to:
** .65% for the Managed Allocation and Aggressive Managed Allocation Options
** .50% for the 100% Equity Option
** .71% for the Balanced Fund Option

I have also covered in today’s show “10 Little Expenses that add up fast” according to Bankrate.com (click here for the link) This is probably a great time to have this discussion since the Holiday season can lead to some run away expenditures. Remember with money especially, you have to sweat the small stuff.

Great news out there in the world of mutual funds. Fund companies are starting to move away from redemption fees that were implemented to stop the institutional trading scandals that occurred back in 2004. Fund companies have found other ways to stop these bad practices without penalizing the masses. Check out the full article in InvestmentNews by Ilana Plyak (click here for link)

Remember there are quite a few Snake Oil salesmen out their, so be very careful when you get lunch and dinner invitations in the mail for financial seminars. Check out the article in InvestmentNews by Joseph Borg titled “Remember, there’s no such thing as a free lunch” (click here for link)

Also covered from InvestmentNews by Sara Hansard titled “401(k)s not enough for young workers” (click here for link)

The last article from today’s show came from reading Boston Gal’s Open Wallet Blog (click here for link). Boston Gal had an entry titled "Sex, drugs, hedge funds, and outrageous cable bill?!?". The entry linked to an article that appeared in the New York Times about the death of Seth Tobias titled "A Lurid Aftermath to a Hedge Fund Manager’s Life" by Andrew Ross Sorkin. I was shocked by his cable bill just like the Boston Gal, but I think that this also shows that you need to pay attention to who you are working with. If the excesses of the investment industry lead to more individuals like Mr. Tobias it will not be long before we have shows titled "Behind the Money" similar to the "Behind the Music" episodes on VH1.

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