European Stars and Stripes (Newspaper) - January 22, 1990, Darmstadt, Hesse                                Insurance eau ill a Jim my Iii a a it 11 i him continued from Page i 3j one customer May be totally wrong for another. A the concept of buying term and investing the difference is valid from a pure mathematical standpoint a he says. A the problem is most people buy term insurance and spend the difference. That is the reality buying insurance today is More of an investment than in the past he can ends a life insurance is one of the few things that has toil in cheaper he says. A at age 25, a Soldier can buy s100000 Worth of life insurance for 550 a month. By age 65 he a have $200,000 he could withdraw w without affecting his coverage Jan Hudson and Leslie Gillespey prud Colial insurance agents based in Mannheim West Germany say you can Combine life insurance w Ith finance 101 sound investments through a variable policy invested in Money Market instruments Long term Bonds government securities and a mix of stocks. The policy Holder can choose Between a conservatively or an aggressively managed portfolio. Martin Van Leven a certified financial planner in Vilsick. West Germany says saving Money in this manner is better than not saving at All. But its not the Best method available. A the Bottom line is w Hen you buy life insurance buy life insurance. Neer mix death and investment he says. Van Leusen is a proponent of buying term and investing the difference. A the More you control your own Money the better off you arc Quot he say s. Quot the whole life insurance client could get the same coverage with about $24 in term insurance. Van Leven says. By investing the remaining $26 in a Mutual fund averaging 14 percent he dam $558,859 in 40 Yean. Van Leven says the 14 percent is conservative because Mutual funds have Ltd a never too soon to save for your child s education by Randy Pruitt Stair writer when it comes to saving for your child s College education it s never too Early. Quot laughable As it May sound planning for your child a move to the College dormitory should begin before he or she leaves the Nursery Quot said William Sullivan senior vice president and director of individual financial services Al Merrill Lynch the huge . Brokerage firm. Sullivan suggests that parents use a structured savings and investment plan. Future College costs can be projected by computer a service offered by Many financial planners and full service brokerage firms he said. A unfortunately the Cost of College has outpaced the Overall inflation rate and is expected to continue its climb a he said. And the number of americans earning a Bachelor s degree also has risen. In 1940, one in 17 people Between the Ages of 25 and 29 had College diplomas. Today it is Ore in five. Beginning this year. . Savings Bonds ofter some Active features for the College conscious mom or dad. Interest is exempt from income tax if a the Bonds were issued after Dee. 31,1988. A the Bonds Are cashed to pay education expenses. A inc holders Are joint filers with an adjusted Gross income of less than 560,000 or single filers with less than $40,000. Interest May be partially tax free for joint filers in the $60,000 to $90,000 brackets and for single filers with adjusted Gross incomes of $40,000 to $55,000. Certain other restrictions apply. A Nom bar of state governments offer College prepayment plans Sullivan said. With these programs parents pay a Fiat fee based on the child s expected enrolment Date and projected in Fin lion rates. Averaged a 16-Pcrccnt return Over the past 10 years. Sixteen percent would result in s 1.079.855 Over 40 years he calculates. But Van Leven cautions investors to be wary of today a Dollar signs. Based on an annual inflation Factor of 6 percent s 200.000 would be Worth s19,441 in 1990 Money. The buying Power of $ 5 58,859 would come to Only $ 54.709. He say s. A everybody s income increases hut whal they be got to evaluate is the Money they Pul away. Is it increasing with their increase in pay and with in Linn Quot he says. Quot if you buy term and do your own investing then you re going to end up farther ahead Quot Van Leven says. A you want to buy that pure  certified financial planner George Nigro of Isle nest International in Ramstein says need should be the guiding principle to How much insurance a person buys a but if a person buys term and invests the difference they will create  he says. A a Fay the tuition today As a hedge against _ increasing costs for an education in the future Quot he said. Sullivan cautioned that the prepayment plan will backfire if the child is not accepted Al the school or chooses not to enrol. The amount refunded would vary often with no interest. The loss could be substantial. In addition contributions could result in gift tax Pitfalls to the Parent and income tax consequences to the child. Quot if you save on your own. The Money would be yours to use at any school Quot he said. If your child will enter College soon. Sullivan recommends against inc prepayment plan. Some institutions will calculate the full four year tuition based on the freshman year costs and let the Parent pay it in one Lump sum. He said. Quot Many will lend you the Money to pay the  he said. Another alternative is a Home equity loan or borrowing on a 401 k plan if you Nave one. Such Loans Are justified Sullivan said because . College graduates earn nearly 40 percent More than those without degrees and Are less Likely to be unemployed. 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To m in Scorel i red fibroid to Nui tiry ind Maina cow new pcs it w amp of h new o o cow h cd t3stars and stripes bookstores a stars and stripes bookstores k\v1 tax guides 2sssm/ i cd Pilot h cd a Loans there /jl0�s�i&.books and magazines about managing your Money., in Stock now at most stars and stripes bookstores. A Sta Sand stripes bookstores a stars and stripes bookstores 14 s4s financial planning guide january 22, 1990