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Welcome to NerdWallet’s Smart Money podcast, where we answer your real money questions.
This week’s episode begins discussion with Liz Weston about her column “How to Complain and Get Results.”
Then we move on to this week’s money question From Kathy who emailed us: “I want to start saving for my little son. I have considered an education savings account, but worry if he doesn’t choose college that there will be a penalty. What advice do you have for preparing your kids for financial success and independence (when you don’t have a lot of money to invest)?
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Our attitude to protest to get results
Smart Money co-host and NerdWallet columnist Liz Weston recently wrote about how to complain about customer service and get results. First, Liz recommends preparing mentally and physically for the interaction. Recognize that dealing with customer service can be frustrating and time-consuming, and have relevant information such as confirmation numbers and warranty information handy.
Companies have many ways for consumers to submit complaints, including through social media, over the phone, or through a chatbot. Choose the communication method that suits you and the nature of your complaint. Liz also offers suggestions for dealing with customer service representatives. When you finally do get in touch with someone, clearly explain the problem and how you want it resolved, and be nice. It can help you get what you want.
Our take on saving for college
Parents have a list of options that can help them save for their children’s education. Plus, these savings vehicles aren’t mutually exclusive, so you can open multiple accounts that can be used to pay for educational expenses if you want.
One of the most popular education savings accounts is the 529 plan. Withdrawals are tax-free when used for eligible expenses, and there is some flexibility in how the funds can be spent. If your child is not attending a four-year college or university, the money in the 529 plan can be used to pay for vocational school or another family member’s education.
Parents can also put money into a high-yield savings account, CD, or savings bond. If you open a CD or bond, learn about early withdrawal penalties. A Roth IRA is another option for parents of children with earned income. Its name suggests it’s a retirement account, which it is, but Roth IRA earnings can be used to pay for qualifying educational expenses. Furthermore, these earnings can be withdrawn without tax penalty.
- Know your options. Choose an account to use for savings, such as a 529 savings account or a Roth IRA, and try to put money into it regularly.
- Make this a learning opportunity. Talk to your child about how you save and why it’s important.
- Be flexible. Explore your options for early withdrawal or beneficiary changes if your circumstances change.
Got a money question? Text or call us at 901-730-6373. Or you can also us [email protected]. To listen to previous episodes, visit podcast homepage.