Discuss the ira plan

Assignment Help Engineering Mathematics
Reference no: EM131506387

Question: A 529-state-approved Individual Retirement Account (IRA) permits parents to invest tax-free dollars into their children's college education fund (this money may only be used for educational expenses). Another popular plan, the Roth IRA, requires after-tax dollars to be invested in a savings fund that may (or may not) be used for paying future college expenses. Both plans are tax free when the money is eventually withdrawn to assist with college expenses. Clearly, the 529 IRA plan is a better way to save for college expenses than the Roth IRA. Quantify "better" when the marginal income tax rate is 28% and $10,000 each year is invested in a mutual fund earning 8% per year for 10 years.

Note: The estimated cost of a college education 10 years from now is $110,000.

Reference no: EM131506387

Questions Cloud

Which plan is better if the future income tax rate is given : A Roth IRA enables an individual to invest after-tax dollars during the accumulation phase of a retirement plan.
A brief physical description of your character : Conclude with a brief physical description of your character - special teacher or a coach or someone you knew at church or at work
How was the needs assessment conducted : How was the needs assessment conducted? How were the objectives for training set?What training design and delivery method would be most useful for this program?
What is dominant/recessive inheritance : What is dominant/recessive inheritance? What is X-linked inheritance? What is codominant inheritance of genes? What is a Punnett Square?
Discuss the ira plan : A 529-state-approved Individual Retirement Account (IRA) permits parents to invest tax-free dollars into their children's college education fund.
The relationship between language and thinking : Consider the following quote by the philosopher Ludwig Wittgenstein, who believed that thought without language was impossible
Summarize the statistics from the last two reports : Summarize the statistics from the last two reporting years. Be sure to include demographic information such as ethnicity, race, age, gender, marital status.
Determine the after-tax yield : Determine the after-tax yield (i.e., IRR on the ATCF) obtained by an individual who purchases a $10,000, 10-year, 10% nominal interest rate bond.
State of mind of the narrator in skunk hour : What is the state of mind of the narrator in "Skunk Hour" and does this state of mind change by the poem's end?

Reviews

Write a Review

Engineering Mathematics Questions & Answers

  Calculate the eigenvalues and eigenvectors of matrix

Hand calculate the eigenvalues and eigenvectors of matrix A - Outline the steps on how you can use Simulink to demonstrate the linearity and the time invariance of the system.

  Find confidence interval for television and computer

Which would be hardest for you to Ow up: your computer or your television? In a recent survey of 1677 U.S. Internet users, 74% of the young tech elite.

  Small denomination time deposit

Explain the changes in M1 and M2, if an individual moves money from a small denomination time deposit to a demand deposit account?

  Find validity of advertising claim by level of signifcance

The chamber of commerce of a Florida Gulf Coast community advertises that area residential property is available at a mean cost of $125,000 or less per lot.

  1 prove directly from the axioms for a vector space

1. prove directly from the axioms for a vector space thatnbsp for any scalar a.remark. of course this fact is not hard

  What if the jumps are not log-normal

If the option has N look-at dates, how many (pseudo-)random numbers will be needed per path? What if the jumps are not log-normal?

  Differentiate between the nominal and real exchange rates

Describe the difference between the nominal and real exchange rates. What does rising inflation do to that country's real exchange rate?

  Describe the cash flow diagram

Two systems are being considered for the same task. System 1 costs $63 000 new and is estimated to last four years. It will then have a salvage or trade.

  Write down a dual formulation of linear program

Write down a dual formulation of this linear program - describe how the dual formulation can be used to obtain a feasibility cut in the L-shaped method.

  What is the net income for the firm

What is the net income for the firm? Suppose the company paid out $48,000 in cash dividends. What is the addition to retained earnings?

  What process for fra is equivalent to the log-normal process

What process for the FRAs is equivalent to the log-normal process for forward rates? Suppose we make the FRAs log-normal, what process do we get for the rates?

  Write down the payoff matrix for this game

The Game of Morra. Two players simultaneously throw out one or two fingers and call out their guess as to what the total sum of the outstretched fingers.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd