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BOOK REVIEW: ‘The Best Way to Save for College’ Is Best Book on 529, Other College Savings Plans

Posted by kinchendavid on November 6, 2006

By David M. Kinchen
Huntington News Network Book Critic

Hinton, WV  – With his 7th edition, Joseph F. Hurley’s ”The Best Way to Save for College 2007: A Complete Guide to 529 Plans” (Savingforcollege.com LLC, Pittsford, NY, $22.95, 295 pages) reinforces its position as the best book on its subject.

Joe Hurley, a certified public accountant in the Rochester, NY area, literally wrote the book on 529 programs – so named for the section of the Internal Revenue Code that covers them – back in 1999 and I had a small part in his ensuing success, if I may be so bold. I reviewed his first book when I was business news editor – in fact the entire biz news staff – at the Register-Herald in Beckley, WV. I raved about the book and subsequent editions quoted me.

When I took over as editor of HNN 2½ years ago – it seems like only yesterday! – I reviewed the revised edition that Hurley’s office sent me. The new edition has a quote from that review: “There is just no option when it comes to figuring out college savings plans: get your hands on this book.”

That’s a pretty strong endorsement, in anybody’s language, and it applies in spades to the latest edition. In August 2006, President Bush made the future of 529 plans – basically mutual funds geared to financing college tuition and other expenses – secure by signing the Pension Protection Act of 2006. Quoting from Hurley’s book: “Among the Act’s many provisions was the permanent extension of the amendments made to Section 429 by the 2001 EGTRRA, including the federal income tax exemption for qualified distributions from a 529 plan. Families can now invest in 529 plans with more confidence, knowing the exemption is no longer scheduled to expire at the end of 2010.”

Sounds like gobbledygook, but it’s important, since many of the Bush Administration’s 2001 tax cuts will expire – you guessed it – at the end of 2010. Now parents – and probably even more grandparents – can buy one or more 529 plans – Hurley recommends buying several, for reasons he explains in the book – to finance the horrendous cost of college for today’s high school graduates.

A college education costs a heckuva lot more on a per capita income basis than it did in 1957-61 when I attended college. Back then, my tuition at Northern Illinois University – a laughably low amount by today’s standards – was waived because of my service in the Army Enlisted Reserves. I had to buy books and pay a few minor fees, but commuting to college for three of my four years cut my expenses to the bone and I did it without a student loan, surviving with part-time and summer jobs. I received a superior education at minimal expense. What I did then is virtually an impossibility these days, because of high costs and stagnant incomes for most families.

As the Wall Street Journal pointed out in a story headlined “As Tuition Soars, Federal Aid to College Students Falls” tuition and expenses are at record levels and federal aid is falling rapidly, including such important elements as Pell Grants (Hurley discusses them in his book, along with other strategies for saving for tuition). The story by Robert Tomsho ran in the Oct. 25, 2006 edition and here is a link to the story:

http://www.nwfdailynews.com/articleArchive/oct2006/studentaiddeclines.php

College costs are running at least twice the rate of inflation, according to data from the College Board (headed by former WV Gov. Gaston Caperton) cited in Tomsho’s story. For instance, tuition and fees for a four-year public university jumped 6.3 percent from 2005-06 to 2006-07, from $5,492 to $5,836. Inflation is officially measured at about half that rate, although I have major objections to the way the government calculates inflation. That’s another story!

Hurley says he became an authority on college savings plans out of necessity: He and his wife Ginny had a daughter in the eighth grade and a son in elementary school. They had to start saving money to pay for the education of their kids because a college education is basically today’s equivalent of a high school education a couple of generations ago. The daughter, Megan, 20, is now in college and their son, 16-year-old Chris, is in high school, with college on the near horizon.

The book is written in non technical language as much as possible, although technical terms are necessary from time to time. They’re explained in plain American English. I’ve got to say this about Joe Hurley: for a CPA, he writes excellent prose! I’m guessing he’s had some help, but that doesn’t lessen my compliment one bit, Joe!

While the main focus of the book is on 529 plans – including a comprehensive state-by-state list of such plans (West Virginia has five separate plans and every state except Wyoming has at least one plan, or an updated version of its predecessor, a prepaid tuition plan) – Hurley devotes a significant amount of space to alternatives to 529 plans, including the Coverdell ESA plan, in Chapter 9. He also discusses investment strategies, estate planning and other subjects dear to the number-crunching heart of a CPA – and important to the rest of us who don’t understand a word he’s saying (just kidding, Joe!).

“The Best Way to Save for College” maintains its position as the best single volume on college saving plans and strategies. It’s must-read material for any parent with children or any grandparent with a some funds to invest for college costs. Well-stocked bookstores should have Hurley’s book or it can be obtained directly from the publisher: Savingforcollege.com LLC, 1151 Pittsford-Victor Rd, Suite 103, Pittsford, NY 14534. 1-800-400-9113. Hurley’s web site is: http://www.savingforcollege.com and his email address is: Support@savingforcollege.com.

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