Dear Liz: You wrote that people could contribute up to five times the annual gift tax exclusion to a 529 college savings plan without having to file a gift tax return. People can contribute that much without the gift reducing their lifetime gift and estate tax exemption amounts, but they must file annual gift tax […]
Recent Blog Posts
Q&A: Should I convert my IRA to a Roth?
Dear Liz: I have $160,000 in a 403(b) retirement plan and I’m 70. I know I have to start taking required minimum distributions (RMDs) at age 73. Should I transfer the funds to a Roth IRA or can I start taking the RMD from the 403(b) and leave the remainder to grow? Answer: You can take your […]
Q&A: You can pause Social Security payments
Dear Liz: Are you allowed to stop your Social Security payments if you choose to make over the $23,000 limit? Answer: When you start Social Security before your full retirement age, you’ll face the earnings test that reduces your benefit by $1 for every $2 you make over a certain limit, which in 2026 is $24,480. You […]
Q&A: How to help grandchildren pay for college
Dear Liz: What is the best way for us to contribute to our grandchild’s college expenses? I believe federal financial aid formulas no longer count grandparents’ cash or 529 contributions. Would direct cash to the student (who is responsible) or a 529 be the most beneficial to the student or us? Answer: If the grandchild is already […]
Q&A: Credit union loan helps son pay off debt
Dear Liz: My son ran up a lot of credit card debt and it got to the point where he could barely pay even the interest, which was exorbitant. He asked me for a loan, but I wanted something to formalize the process. I tried cosigning on a loan with him, but found that, as a […]
Q&A: How do you set up a savings account for a grandchild who lives overseas?
Dear Liz: My son lives overseas. He just became a father. He plans to apply for U.S. citizenship for his dependent as an American born abroad. We would like to help save for our new granddaughter’s future. There are 529 accounts here. Can he set up an account like that if he gets a Social Security […]