08-24-2017 Columns

Can you save for college and retirement?

Few of us have unlimited financial resources — which means that almost all of us need to prioritize our financial goals. Consequently, you’ll have some decisions to make if you’d like to help pay for your children’s college educations someday while, at the same time, saving for your own retirement.

Your first step in addressing these objectives is to maintain realistic expectations. Consider the issue of paying for college. Right now, the average four-year cost (tuition, fees, room and board) is about $80,000 for in-state students at public universities and approximately $180,000 for private schools, according to the College Board. And these costs are likely to keep rising in the years ahead. Can you save this much for your kids’ education?

Instead of committing yourself to putting away this type of money, take a holistic approach to saving for your children’s higher education. After all, you probably won’t be the only one to help pay for college. Depending on your income and assets, your family might be eligible for some needs-based financial aid awarded by the college. Also, you should encourage your children to apply for as many scholarships as possible — but keep in mind that most scholarships don’t provide a “full ride.” Here’s the bottom line: Don’t assume you will receive so much aid that you don’t need to save for college at all, but don’t burden yourself with the expectation that you need to pick up the full tab for your children’s schooling.

On a practical level, you may want to commit to putting a certain amount per month into a college savings vehicle, such as a 529 plan. You can generally invest in the 529 plan offered by most states, but in some cases, you may be eligible for a state income tax incentive. Also, all withdrawals from 529 plans will be free from federal income taxes, as long as the money is used for a qualified college or graduate school expense of the beneficiary you’ve named. (Withdrawals for expenses other than qualified education expenditures may be subject to federal and state taxes and a 10% penalty on the earnings.)

By starting your 529 plan early, when your children are young, you’ll give the investments within the plan more time to grow. Plus, you can make smaller contributions on a regular basis, rather than come up with big lump sums later on.

And by following this approach, you may be in a better financial position for investing in your IRA and your 401(k) or other employer-sponsored retirement plan. Obviously, it’s to your benefit to contribute as much as you can to these plans, which offer tax advantages and a wide range of investment options. If you’re investing in a 401(k) or similar employer-backed plan, try to boost your contributions every time your salary increases. At the very least, always put in enough to earn your employer’s matching contribution, if one is offered.

And once your children are through with college, you can discontinue saving in your 529 plan (although you may want to open another one in the future for your grandchildren) and devote more money to your retirement accounts.

It can certainly be challenging to save for education and retirement – but with discipline and perseverance, it can be done. So, give it the “old college try.”

This article was written by Edward Jones for use by your local Edward Jones Financial Advisor.

Vaccines and pregnancy

Vaccines are an important part of planning and having a healthy pregnancy. If you are planning a pregnancy, check with your doctor to make sure you are up-to-date on your vaccines. If you are currently pregnant, doctors and midwives recommend you receive two vaccines during your pregnancy: Tdap to help protect against whooping cough and the flu shot to help protect against influenza.

If you are in the pregnancy planning stages, you may need to receive some vaccines. Your doctor may need to give you vaccines several weeks before you become pregnant because it could take a while for your body to build up disease protection (immunity) after getting the vaccine. Some vaccine-preventable diseases, such as rubella, can lead to serious complications, including birth defects. You should not get the vaccine to prevent rubella if you are currently pregnant. Therefore, planning ahead is very important.

During your pregnancy, you should receive vaccines against both the flu (if you haven’t already received the vaccine during the current flu season) and whooping cough (pertussis). These vaccines not only protect you by preventing illnesses and complications, but they also pass on some protection to your child.

You can rest assured that these vaccines are very safe for you and your baby. Millions of pregnant women have safely received flu shots for many years, and CDC continues to gather data showing that the flu shot is safe and effective during pregnancy. The whooping cough vaccine is also very safe for you and your baby. Getting the vaccine during your pregnancy will not put you at increased risk for pregnancy complications.

For more information, visit www.bchdmi.org or call 269-926-7121.

House C.A.R.E.S. Task Force

Earlier this summer, House Speaker Tom Leonard created the bipartisan House C.A.R.E.S. (Community, Access, Resources, Education and Safety) Task Force to receive input on how to improve mental health services across our great state. The task force is currently holding a series of meetings around Michigan to gather input from citizens and professionals alike.

In addition to this listening tour, the House has also created a website to allow anyone to submit their ideas and suggestions. You can visit this website at www.house.mi.gov/CARES and submit your ideas in the “We Want To Hear From You” section. In initiating this task force, we realized that the most valuable feedback would come from people on the front lines that may face challenges navigating our state’s mental health system. There are a number of reforms that you may want to consider. These could include improving support for veterans, additional attention to substance and opioid abuse, improving mental health courts, better training for law enforcement, and addressing the mental health needs of those who are incarcerated.

The goal of the task force is to develop policy recommendations that will improve mental health services for all Michiganders, ensure public safety, provide smarter expenditure of resources, help crime victims, and prepare those who are incarcerated to safely and productively re-enter society.

I hope you will take this opportunity to submit your ideas on this important issue. By working collaboratively with people across the aisle and around the state, we can have a tremendous impact on the lives of so many of our fellow Michiganders. I also encourage you to contact me directly if you have any ideas on this or any other state government issue. You can reach me toll free at (800) 577-6212 or via email at BethGriffin@house.mi.gov.

Increasing opportunities for a successful career

Since 2011, we have created a positive business environment in Michigan that has helped create nearly half a million private sector jobs and reduce our state unemployment rate to 3.7 percent, the lowest rate in 17 years.

It’s a positive record of achievement, yet we must continue to encourage job creation and help connect employers seeking workers with residents looking for work.

One step is providing students and workers with the skills necessary for in-demand jobs.

We must also look at ways to incentivize employers to hire residents who have consistently faced significant barriers to get a job, such as the disabled and our veterans.

Michigan should take a look at mirroring the successful federal Work Opportunity Tax Credit (WOTC) at the state level to get people off welfare and back to work.

The federal WOTC offers a credit to employers who hire workers from targeted groups, like disabled or unemployed veterans, recipients of public financial or food assistance or long-term unemployment benefits, ex-felons and others.

Originally part of our criminal justice reforms, Senate Bill 14 would have provided incentives to employers who hire people on probation or parole.

I am working on a new measure that is similar to SB 14, but that would be broadened to include all the groups in the federal WOTC program.

Michigan’s economy is growing and creating jobs, yet some people are struggling to get a job. This program would focus on providing a small incentive to help give groups with high unemployment rates a chance to get off public assistance and have a rewarding career.

As always, I look forward to hearing your comments and feedback on the important issues facing Michigan. You can contact me at 517-373-6960.

Critical public health and jobs legislation now law

Every five years, Congress must reauthorize the Food and Drug Administration’s (FDA) user fee programs for generic drugs, prescription drugs, biosimilar biological products, and medical devices. These programs are critical to patients, drug and device manufacturers, and the millions of Americans who work hard every single day to deliver new treatments and cures. And in some good news that you may not have heard about: Congress came together and overwhelmingly passed legislation that would do just that and last Friday, President Trump signed our legislation into law.

H.R. 2430, the FDA Reauthorization Act of 2017, is a bipartisan bill that updates and reauthorizes these critical user fee programs. Specifically, it will make common-sense reforms to the FDA such as facilitating the availability of over-the-counter hearing aids, enhancing generic drug competition to help lower prices, and improving fee structures to help small businesses thrive and grow. Without swift enactment of this legislation, the FDA would be forced to start laying off up to 70 percent of their employees that approve drugs and devices. That would have a devastating impact not only on local pharmaceutical firm jobs but to patients and consumers who may be forced to needlessly suffer without the availability of potentially life-saving new drugs or devices.

Beyond the public health benefits, this legislation is critical to thousands of jobs, particularly here in Southwest Michigan. We are home to medical device maker Stryker Corp., the generic drug maker side at Perrigo Co., Pfizer Inc’s largest manufacturing site and dozens of smaller biotech and manufacturing firms. Folks at these firms have told me it is vital for this legislation to move forward to protect these local jobs as well as patients who will benefit from the new therapies the FDA helps get to market.

Workers, job creators, and patients here in Michigan and across the country depend on this legislation, and we just delivered.

To learn more about this and other important legislative issues, please visit my website: upton.house.gov or call my offices in Kalamazoo (269-385-0039), St. Joseph/Benton Harbor (269-982-1986), or Washington, D.C. (202-225-3761).