Monday, April 30, 2018

Thoughts On 529 Plans

"You can lose a lot of things, but no one can take away the knowledge you gained."
- Dr. B. Roberds 

My parents told me that if nothing else, they did what they could to provide a good education to me.  For that I am grateful.  I also think about the quote above, which came from one of my former bosses.  Along that vein, I'd like to provide the opportunity for knowledge to my kid.  To me, this means college and beyond.

Brief primer on 529 plans: they are a nice way to save money for college. After-tax money can be invested and can grow tax-free, plus the money won't be taxed if used for a qualifying expense such as college, or more recently, even lower grade schools (K-12.)  There is also no limit to the length of time a 529 plan can be held.  For compounding, this is huge, and this doesn't even take into account "529 super-funding" that rich people can take advantage of!

Here's the game, how can you maximize the benefits?

Let's assume you have a kid and open a 529 account, and you do what you can to contribute the yearly maximum to it, which for some is already a stretch.  Here's one reason example of why it might be worth the trouble.

Example:
  • Maximum contributions are made at the beginning of each year and the market grows, the rate I chose is 6%.  
    • Caveat 1: 529 plans have limits to contributions once an account reaches a certain limit. I think that limit is $300k currently (plan-dependent) which is still quite a lot. Presumably, once the beneficiary goes to college and starts to spend it down, contributions could begin again.
    • Caveat 2: the table below uses the tuition of a public university, in this case UCLA, semi-randomly picked as a desirable place to attend, with strong academics, but not the cheapest public university.
  • Kid goes to college at year 19.  For simplicity in this example, goes to graduate school right after.  
    • The assumption here is that the graduate program is not a business or medical school, which could result in much higher costs and additional school time like med school.
  • Consider the following, assuming one could make the maximum contribution and the market returns at 6% and college tuition inflation rate as 4%.  Click here for larger version.
After graduation, there's money left over.
  • It's possible that the kid doesn't spend it all!  
Firstly, here is where there is a problem.  A parent who designated a child as the beneficiary can designate another beneficiary as long as it's the equivalent generation as the child, like a sibling, or a first cousin.  

You can't re-designate yourself (as a beneficiary) to a grandchild without triggering something called the generation-skipping gift tax.
  • If kid never has grandkid, unless you have another "member of the family" beneficiary to designate to, then you're boned, the tax penalty is waiting.
But!  This is where the game gets interesting.

What's unclear to me is, and my own research has not borne an answer to my satisfaction: 
  • If the child is the beneficiary, graduates, then lets the account continue to grow, can said child (or account owner) designate the grandchild as a new beneficiary without the generation skipping gift tax? 
The consequences are:
  • If not, it becomes important not to overfund a 529 plan, otherwise withdrawal comes with tax penalties.
  • If yes, then overfunding a 529 plan might be really advantageous, such as continuing contributions for said child after graduation but prior to grandchild, thus funding multiple generations worth of college expenses through the power of compounding.  
    • Based on this, it might be possible!  Which means, I need to do more research.
I took the following snippet from the link above and it applies to this whole post:

This information does not constitute tax advice and is provided for informational purposes only. Please consult your tax advisor, financial advisor, local taxing authority, and/or plan provider or sponsor for more information.

Monday, January 22, 2018

Star Trek: Voyager


Robert Beltran, Robert Duncan McNeill, Kate Mulgrew, Robert Picardo, Jeri Ryan, Roxann Dawson, Ethan Phillips, Tim Russ, and Garrett Wang in Star Trek: Voyager (1995)

After finishing The Wire, I was a little lost as to what to watch next.  It's hard to pick a new show to watch when finished with one is as good as The Wire.  That said, I picked Star Trek: Voyager.  Like with other Star Trek series, I never watched this chronologically, so here we go!

In general, I believe I prefer serialized shows over episodic ones, which might be why I like DS9 so much.  That is how Voyager is from the outset, it seems.

Watching the first season now, I am reminded of my earlier thoughts about Harry Kim when I watched the show on TV years ago; he keeps getting screwed over!  Which sucks.  However, I do like seeing Captain Janeway in charge, and how it ties with DS9 but with the Maquis and the Starfleet crews having to work together rather than as enemies, and even The Doctor (medical hologram) tying back to the original doctor's visit to DS9.  Fun little tie-ins.

So far there have already been some fun and interesting episodes, while at the same time, the DW thinks that Voyager is more "physics-y."  Sounds good to me.


Friday, December 15, 2017

The Wire


This show is so good.  So damn good.  I'm on the first season about 10 episodes in and it's fantastic.  It's a slow burn at first, then builds.  There's a reason this show was rated the 2nd best show of all time by Rolling Stone.  Deservedly so.

Monday, November 20, 2017

Star Trek: Deep Space Nine



I've been watching a lot of ST:DS9 lately and I must say, it's really good.  It's not the same as ST:TNG, less exploration, but I really like the storyline that presents the Dominion as a lurking threat throughout all the seasons.  It's almost more like Babylon 5 than Star Trek.  It's one of the things that I always thought was missing from TNG.  The Borg was there but it didn't pay off as I'd hoped.

The first few seasons of DS9 let you get to know the characters, understand their relationships and grow to care for them, but after season 4 though, the series really heats up with the threat of open war.  I'm on to season 6 now!  I also think it's so great to have a diverse cast of lead characters.  Worf, Sisko, Dax, Quark, Odo and Kira, Dukat, all are great.  Can't wait to see how this all plays out.

I'm eyeing the next series to see, and though I've got ST: Voyager and others in the watchlist, I think I'll be diving into The Wire next.  I mean, it's only one of the best series ever, right?

Tuesday, October 31, 2017

TEP Wireless Hotspot


I had a recent business trip to Europe and needed internet access for email, texting via Google Voice, maps, Whatsapp, etc.  At first I tried to add it to my prepaid plan, but my plan is so cheap that it doesn't even qualify for the option to add international data and texting, even for a short period. 

Enter Tep Wireless.  The process was pretty simple and I rented it for a week.  About 3 days before my scheduled trip, I received it in the mail and fired it up and was able to connect my phone to it directly.  The hotspot was set to work in Europe, so it had no internet yet at my home until it was activated for the first day of my trip.  The package also came with an envelope to send back the hotspot when I returned home.

Pleasant surprise: The hotspot itself came in with a charger that is built with an international power plug adapter with a plug in port and a USB-out to charge the hotspot.  This came in quite handy at the hotel to plug in the work laptop.

Coverage: For the most part, data access was decently quick, ~11Mbps download, and worked in most of the places I went, certain dead zones appeared as would any mobile device would see.  Everything that I needed to work, worked.  There was a few hours where the hotel wifi wasn't working, but I was able to use Whatsapp and video call the family with the Tep hotspot without any significant slowdown or issue.  Color me quite satisfied.

Battery life: depends a little on your data use, but after about 6 hrs of moderate use the device went from 100% -> 30%.  I had my Anker Powerbank with me to charge it back and keep me connected through my workday without any problems.  When charging and using data, the device could get pretty warm, as expected.

Price: At about $9/day, the price is pretty reasonable, especially if you travel with multiple people with many devices (phone, tablet, etc).

One drawback that I noticed, the hotspot is a little slow to boot up.  Meaning, it will take a minute or two to turn on, boot up, find connection, and connect your devices.  Once I realized this, I opted to keep it on most of the time and have it connected to the power bank to charge periodically rather than deal with the wait to start it up.

Overall, this device is pretty good for travel, especially if you have multiple devices to connect and would rather not pay for adding international text and data to your cell phone plan.  I would definitely look into using this again, even for personal use.

Sunday, July 9, 2017

Favorite Chips

Was musing the other day about the various salty chips/snacks that I like and came up with this list. These are my top 5.
  • Doritos Spicy Nacho
  • Lay's Sour Cream and Onion
  • Tim's Hawaiian Sweet Maui Onion
  • Ruffles All Dressed (Canadian version)
  • Cape Cod Original

Friday, July 7, 2017

Fitbit Charge HR

After about a year and a half since getting a Fitbit Charge HR, the fitness tracker has given up.  I received it as a Christmas present, and was pretty happy with it.  Steps tracking was fine, HR monitoring was usually high by 10-15% but not a big deal.  Good community, I enjoyed getting cheers or taunts from my friends who also had Fitbits.  The integration with other apps is good too!

That is, until the last 6 months, when a bubbling issue in the band crept up.  My fault for not immediately contacting Fitbit about it, but my 1 year warranty lapsed before I could contact them for a replacement.  Now I know from the forums that it is a known, repeatable issue.  What I didn't know is that the bubbling would later become catastrophic for the device.  I figured I could live with it.

The band itself is attached to the tracker plastic, maybe with an adhesive.  The band is a rubber material that will expand gradually over time, with heat and exposure to daily use.  Thus, the bubbling is an inevitable occurrence.  Bad design choice.

A few weeks ago, the band had release almost entirely, revealing a slightly cracked plastic interior body of the tracker.  Bad.  Weirdly, I did not see any adhesive or cohesive failure on the widest part of the band, where more glue would have definitely helped.  Bad.  Then, last week, the last vestige of connection between the band and tracker gave up.  Again, no obvious adhesive/cohesive failure from epoxy.  Did Fitbit just press the band to the tracker together thinking this would work and last?

I tried to fix it all with Krazy Glue, which adhered the band and plastic exterior of the tracker just fine, until a day and half later where the plastic interior portion (previously cracked) also broke.

The plastic body was also attached to the PCB, see above.  Broken plastic, bent PCB, broken tracker. Wouldn't even Charge anymore.  All in all, $130 worth of Fitbit Charge HR fitness tracker is pretty much dead.  Sadly, a poor purchase choice, wish these issues were something that could've been mentioned in the review articles that I read, but long-term use is rarely a topic.  Lesson learned, check the forums for a gadget ahead of time before deciding to purchase.  This doesn't work if you're an early adopter though (which I was not.)

Looking at the Charge 2, I see similar design and would definitely not pick one up.  Would not recommend.

Initially, I'd give this 4/5 stars for the community and software integration, but with these hardware issues, I'd have to say, 1/5 because reliability and longevity have to be considerations for an item >$100.  This thing didn't even last as long as a phone.