Use our state-by-state guide to 529 plans to choose the right one for your student.

The college hunt is a parade of choices. Private or public. In-state or out-of-state. On-campus or off-campus housing. But when it comes to saving for school expenses, one choice is a clear winner — a 529 savings plan.

Taking advantage of one of these state-sponsored plans is a no-brainer. A 529 plan shields your investments from federal income taxes, gives grandparents an easy way to boost their grandkids’ college fund, and barely dents your chances for financial aid. And more than half the states sweeten the deal with a state income-tax deduction or credit. Investors have flocked to 529 savings plans. Assets grew from $11 billion in 2002 to $119 billion in 2009, and the average account balance is $12,000 — about one year’s tuition at a public university.

Take the tax break

You don’t have to invest in your state’s plan, but if your state gives you a tax break, it’s often best to stay close to home. Thirty-four states plus the District of Columbia offer state income-tax benefits for 529-plan contributions. Five states provide a tax benefit regardless of which state’s 529 plan you pick. Alabama uses a stick rather than a carrot: It doesn’t tax distributions from its own plan, but it levies a tax on distributions taken from other states’ plans. See our picks, state by state.

With any 529 plan, your savings grow free of federal income tax. Distributions escape federal income tax altogether if you use the money to pay for qualified educational expenses — mainly tuition, fees, books, and room and board (you can use 529 money in 2010 to pay for a computer, but that perk is set to expire at the end of the year).

The accounts are flexible. If Junior doesn’t want to go to college, you can transfer the funds to another family member and preserve the tax benefits. Or you can withdraw the money and pay income tax and a 10% penalty on the earnings. Unlike other education-savings programs, 529 plans allow families to participate regardless of income, and the states set a high ceiling on contributions (usually up to $300,000 per account).

Don’t worry that a 529 will cripple your chances for financial aid. The federal financial-aid formula counts 5.6% of parent-owned accounts as part of the expected contribution to college costs — a relatively painless hit compared with the 20% assessment on student savings.

Go the direct route

You can buy a 529 plan directly from each state or through an adviser. We prefer direct-sold plans because they don’t charge commissions or adviser fees like adviser-sold plans do. You’ll have to pay administration and investment-management fees with any 529 plan, however. Most states offer several investment tracks, which range from conservative to aggressive. More than 60% of investors put their 529 money on autopilot by choosing age-based portfolios, which automatically shift from stock funds to bond funds and cash as the student approaches college age.

Picking a plan is a bit more complicated if you live in a state that doesn’t offer a 529 tax break. Depending on what you’re looking for, go with one of five plans that rise to the top of our list:

Low fees. We like the index portfolios in the Illinois direct-sold Bright Start College Savings Plan. The portfolios, which include mostly Vanguard funds, charge rock-bottom fees, which range from 0.20% to 0.22%.

Ready-made portfolios. Ohio’s CollegeAdvantage 529 plan offers great choices from Vanguard, Pimco and GE Asset Management, as well as certificates of deposit from Fifth Third Bank.

Low risk. Savers who shy away from stocks should check out the Michigan Education Savings Program. It has an option that guarantees principal and doesn’t charge an annual fee.

Varied menu. Fund pickers can benefit from the direct-sold College Savings Plan of Nebraska, with its selection of 20 funds from American Century, Fidelity, Pimco and Vanguard. The wide assortment does come with higher fees; the most expensive fund option costs 1.64% annually.

Adviser-sold fund. If you feel more comfortable going this route, the Virginia CollegeAmerica plan is a standout among adviser-sold 529s.

The drawbacks

The plans do have a number of drawbacks, but there are ways around them. You can change your 529 investment choices only once a year, which can hurt (or help) if you’re tempted to tinker. One alternative is to go with a set-it-and-forget-it option, which does the tinkering for you.

Like just about every other investment, 529 plans took a big hit during the recent bear market because they turned out to be riskier than expected. As a result, a number of states, such as Colorado, Kansas, Utah and Wisconsin, have added bank CDs, FDIC-insured savings accounts, U.S. Treasuries and money-market funds to their investment lineups.

As for fees, expect them to fall as assets grow and managers vie to attract more customers. Last December, Fidelity cut management fees in half for its index portfolios and by one-third for its actively managed portfolios for five direct-sold 529 plans it runs. The Utah Educational Savings Plan, one of the lowest-cost 529 plans, reduced fees on some investment options in February.

From Kiplinger’s Personal Finance magazine, June 2010

Disney Imagineer Joe Tankersley helped design Epcot Center’s The Great Piggy Bank Adventure, a game that aims to make personal finance fun.

Why tackle finance? Did the great drywall-hanging adventure not pan out?

We wanted to take personal finance away from being a job or a task and make it something that makes people think, Hey, I can do that. It’s one of the great things about games. When guests do well at our game, they’re motivated to go home and take on the real-world version.

How do you start The Great Piggy Bank Adventure?

The game is designed to be played by a family. First you set a goal. Then you get a piggy bank and step through a portal into a land populated with oversize piggy banks. Your piggy bank moves from the physical world to a virtual world at each of four stops, the first of which is a savings game. You use your piggy bank to collect as many coins as you can as they fall from the sky. The second stop is the inflation race. You pilot the piggy bank, which is in a hot-air balloon, away from the inflation monster.

Does the monster look like Ben Bernanke?

It actually looks remarkably like the Big Bad Wolf. If you’re caught, it will gobble up your coins and spit them out as smaller coins.

What happens next?

The third stop is about diversification, which is essentially a hide-and-seek game. You get a bunch of coins and your job is to stash them in different places. The more you spread out your coins, the less chance the inflation monster will get all of them. At the final stop your bank hops on a scale and tells you how well you did.

How successful is the game?

We believe an exhibit is successful if we start a conversation. With this exhibit, we were surprised by the number of families who went through it repeatedly. I just watched a mother with her 5-year-old daughter play the game for a third time. That’s a home run — when we can get a guest to delay doing all the other fun things in the park and do the exhibit again.

How long will the game be available?

We started working on the project with T. Rowe Price, its sponsor, in spring 2007. The exhibit opened in May 2009 and is on a three-year contract. But we expect it to last a long time because the topic is never outdated.

From Kiplinger’s Personal Finance magazine, May 2010

He spent days sitting through free seminars to become a super trader. Lesson number one: It’ll cost you.

Admit it: You’ve been tempted. You’ve seen the infomercials for trading systems that will teach you how to master the markets. Sign up for a free seminar in your area and you’re on your way to wealth and freedom. Ordinary people just like you are earning thousands each month. Why not join the club?

With visions of early retirement dancing in my head, I decided to take the plunge, or at least the initial part of it. I would attend the free seminars of three big trading-education outfits: Online Trading Academy, BetterTrades and Profit Strategies. I wanted to see whether these outfits delivered on their promises to help people become successful traders. Here’s what I found.

“Respect your capital”

The first rule you learn at the Online Trading Academy (OTA) is not to trust Wall Street with your money. “Wall Street has trained us to be buy-and-hold investors,” the instructor, Chris, told me and the two other students attending the Power Trading Workshop at the company’s offices in Vienna, Va., a suburb of Washington, D.C. (OTA also has offices in the United Kingdom, Singapore and Dubai, as well as in 29 other cities in the U.S. and Canada.) This is a bad thing, Chris said, because the market goes up, down and sideways. And when it heads south, as it did during the 2007-09 bear market, buy-and-hold investors get crushed. OTA’s mission was to teach the likes of me how to make money regardless of what the market does.

How, you ask? Through the power of technical analysis. Technical analysts study past data — primarily a security’s price and trading volume — to predict the future. They look for patterns to find reliable signals of when to buy or sell financial instruments, such as stocks, options, futures and foreign currencies. The process involves studying a menagerie of indicators, such as candlestick charts, Bollinger bands and something called the stochastic oscillator. Technicians care little, if at all, about fundamental analysis — the examination of, say, a company’s earnings and balance sheet or of general economic conditions.

Technical analysis has both passionate critics and ardent adherents. For example, an October 2009 study by New Zealand’s Massey University found that of more than 5,000 strategies that employ technical analysis, none produced returns in the 49 countries where researchers tested the strategies beyond what you’d expect by chance. However, scores of traders, including billionaire Paul Tudor Jones, say the discipline helped them amass great fortunes. So I tried to keep an open mind.

But a debate about technical analysis was not part of the program at OTA. Instead, the seminar quickly evolved from a round of Wall Street bashing to a pitch to enroll in the company’s $4,990 Pro-Trader class. The seven-day course would show “how to treat your capital with respect,” Chris said. He added that some of the academy’s students had doubled their money in three months after taking the Pro-Trader class. Once I paid tuition, I could retake the course as often as I wanted. And if I used one of the six discount brokers that partnered with OTA, I would earn rebates on commissions up to the cost of the classes I took.

Overall, I left my free OTA seminar less than satisfied. I wanted to learn how to trade and all I got was a sales pitch. It was time to hit the road.

“Who likes money?”

I drove to the Hilton Airport Hotel in Norfolk, Va., to attend the Financial Freedom Expo, sponsored by BetterTrades. About 30 would-be zillionaires, mostly baby-boomers, sat in a cavernous ballroom. Men outnumbered women two to one.

BetterTrades’ presentation was the most lavish of the three seminars I attended. At the front of the room a large projection screen was draped in velvety purple curtains. Tables displaying neat rows of BetterTrades DVD box sets surrounded the screen. I felt like a contestant on The Price Is Right, especially after I met the expo leader, Steve, who was tall, tan and likable — just like the game show’s Bob Barker. Steve fired up the crowd with questions such as “Who likes money?” and “Who would like to make more?”

For Steve, successful trading was a matter of identifying support and resistance levels for a security. Look at a stock chart. If you draw a line that hits multiple points where the stock price bounces back from a low point, it is known as a support level. The line drawn on the chart that hits multiple points where the price peaks is known as a resistance level. Under technical analysis, a stock trader wants to buy at support (low) and sell at resistance (high). Sounds easy, but it’s difficult to know where the support and resistance levels are until after the fact.

With the class wrapping up, Steve had a special offer for me. For just $3,995, if I acted now, I could attend the two-day Market Essentials seminar coming to Norfolk. The first five people to sign up would get free bonus training materials. Steve said I had nothing to lose because if BetterTrades’ strategies did not earn me three times what I spent on tuition within six months, the company would refund my tuition or train me free of charge for up to a year until I mastered the program. (His offer did not take into account how much capital I would put up.)

Despite the guarantee, I wanted to know more about what I was going to learn in the class and what kind of return I could realistically expect to earn. Profit Strategies gave me a glimpse of what to expect.

“Work your tail off”

Profit Strategies (PS) takes the total-immersion approach to education, kind of like throwing you into the pool to force you to learn how to swim. That’s how I felt during PS’s free Active Investor Methods class at the Hilton Miami Airport. The two-day course, which had about 40 students, mixed beginners with trading veterans. We skipped the introductory material and jumped right into trading strategies.

The instructors, Mike and Jay, detailed several complicated systems. One moment we were discussing how to use a spike in a stock’s one-day trading volume to predict whether the price would rise. The next moment we were reviewing how to construct an “iron condor,” a strategy of buying and holding four different options with different strike prices. Between the presentations, Mike and Jay flogged PS’s eight-week courses on various trading systems, each of which cost $3,495. Students in the course would meet with the instructor online once a week for class and to review trades. “Only a limited number of seats left,” Jay said.

The audience had the opportunity to pepper Mike and Jay with questions. A newcomer asked them what kind of return one should expect to earn from trading. Mike said that a 5% monthly return sounded reasonable. That works out to 80% annualized.

All the seminars I attended were quick to point out that individual results will vary. And there’s the rub. Because the performance of individual traders is not public, you have no way of knowing how well these trading programs work. Sure, the seminars present testimonials from their top earners, but you don’t know how well the average student does. Studies show how tough it is to succeed at trading. In 1999, for example, at the height of the day-trading craze, the North American Securities Administrators Association studied the accounts of day traders. Only 11% consistently generated profits, and 70% sustained losses that wiped out their accounts. None of the seminar com-panies monitors the success rate of all their graduates. Says Judy Hackett, BetterTrades’ marketing chief: “We can only track the satisfaction of our customers, and we have lots of very happy customers.”

Students who have succeeded with these systems swear by them. Jeffery Kronenberg, a 30-year-old former life-insurance salesman, says he is able to support himself in New York City using the skills he learned at OTA. He has been a full-time trader since October 2009 after taking a class last May. “You have to work your tail off,” says Kronenberg, who typically gets up at 6:30 a.m. on trading days and works until the markets close at 4 p.m. “They will teach you, but you’ve got to really want it,” says Abba Genes, 26, of Mount Vernon, N.Y. He adds that the skills he acquired from BetterTrades allow him to earn about $1,000 a month to supplement his income as a concierge. Genes, who trades three hours a day in the morning, plans to become a full-time trader after he completes college. He says it took months before he learned how to generate trading profits. Meanwhile, big early losses nearly wiped out his account.

The seminar instructors I met said they made a good living from trading. But it’s impossible to know whether they are successful traders or just great salesmen. The trading-education industry does not have a good track record when it comes to sales practices. Seminar promoter Teach Me to Trade shut down in the U.S. after the Securities and Exchange Commission filed a 2008 complaint against two of its salespeople. The SEC alleged that in Teach Me to Trade seminars the pair claimed to be successful traders, but they actually earned their millions from commissions selling seminars rather than from trading. In December 2009, Investools paid $3 million to settle an SEC complaint that two of its salesmen misrepresented themselves at seminars as expert traders.

As I completed my journey, I couldn’t help but wonder why those who possess the magic formulas for successful trading would give away their secrets — even if they did earn $4,000 or so per customer. After all, if you can earn 80% a year, why would you run the risk of seeing the effectiveness of your strategy diminish as more and more people started using it (a common occurrence in investing)? That aside, what’s clear is that if you decide to learn how to trade from any of these companies, you will need to have faith that your instructors know what they are doing and that you can convert their knowledge into winning moves. The odds will be against you.

Why it’s hard to trade and win

High costs. Most trading programs charge more than $4,000 for their workshops and tutoring packages. In addition, trading generates a lot of commissions, usually $5 to $9 per stock trade at the typical discount broker.

Too much time. It can take years of practice to earn trading profits consistently. Even if you are not trading on a daily basis, you will have to dedicate several hours a week to studying charts and related data.

Potential losses. Trading can lead to huge investment losses. This isn’t for widows, orphans and those with weak stomachs.

Tough competition. Financial firms have better trading tools than you do. High-frequency trading systems utilized by professionals make it harder for individual traders to succeed.

From Kiplinger’s Personal Finance magazine, March 2010

Keeping it light is Fox’s strategy for challenging CNBC.

Fox business network takes fluff to a whole new level, even by the standards of cable news. Watch the channel’s Happy Hour show and get business tips from the Mannheim Steamroller band’s Chip Davis from a bar in New York City’s Waldorf-Astoria hotel. Or listen as America’s Nightly Scoreboard rates the chances that a new book by comic Sacha Baron Cohen (better known as Borat) will succeed.

The sugar-sweet programming seems designed to make the “medicine” of real business news more palatable. Fox Business executives say the channel wants to broaden its audience beyond those viewers who would regularly watch CNBC and the geekier Bloomberg Television. But how are breathless interviews with British celebrity chef Nigella Lawson or the Naked Cowboy, a New York City street performer, any different than the pablum that permeates the rest of cable news?

Fox Business, which launched October 15, excels at promoting itself and the products of its parent company, News Corp. Money for Breakfast, the channel’s morning show, ran a sappy segment about how the New Orleans cop show K-Ville — which runs on the Fox network — has boosted the Big Easy’s economy. It’s as if you’re watching a commercial for business news instead of actual business news.

Frivolity often gets in the way of a good TV story. When U.S. Treasury secretary Henry Paulson gave a revealing speech about U.S.-China economic policy in October, CNBC and Bloomberg covered some of Paulson’s remarks live. Meanwhile, Fox Business ran a piece about the business of college football’s Bowl Championship Series.

Don’t expect Fox Business to revolutionize the format. On weekends, it’s the same old infomercials for get-rich-quick schemes and other junk you find on CNBC. “We decided we couldn’t boil the ocean,” says Kevin Magee, executive vice-president at Fox Business. “So we attacked Monday through Friday first.”

Yet watching Fox Business reveals at least one gem: The Dave Ramsey Show. Ramsey, already a popular author and radio-show host, prods his viewers to shed their debts and save more.

And Fox Business has a better stock ticker than its competitors. The ticker identifies the company, stock symbol, share price, gain or loss, and the sector of the economy to which the stock belongs. That makes it more useful than the whirl of data that blazes across the bottom of the screen on CNBC and Bloomberg.

In time, Fox Business may grow up. Many of CNBC’s best anchors were recruited from the ranks of the Wall Street Journal, and News Corp. was on course to complete the purchase of Dow Jones, the Journal’s parent company, in late 2007. But Fox Business doesn’t have carte-blanche access to Journal staffers until 2012 because of a preexisting pact between CNBC and Dow Jones. After the kinks are ironed out, let’s hope Dow Jones veterans can add a degree of class to a network that seems to think it can lure viewers only with fluff.

From Kiplinger’s Personal Finance magazine, January 2008

A new book by Donald Trump and Robert Kiyosaki offers only vague strategy.

In a world filled with financial peril, two men think they can save you. One comes from the mean streets of midtown Manhattan, a survivor of the reality TV jungle. The other is a fighter from Hawaii, hardened in pits of real estate investing expos and public television pledge drives. Who are these self-proclaimed straight shooters? None other than mega-developer Donald Trump and entrepreneur Robert Kiyosaki (best known for his New York Times best seller Rich Dad Poor Dad.).

Together, this dynamic duo has collaborated on Why We Want You to Be Rich, out in bookstores Oct. 10. The book seeks to free you from the banality of middle-class financial life — and the folly of most personal-finance advice. Or so its authors would like you to believe.

The Donald needs no introduction. Kiyosaki’s success with Rich Dad Poor Dad has spawned a franchise of books, games and speaking engagements. He’s also made a PBS special, usually trotted out when public television stations need help from viewers like you.

Impressive resumes. Alas, unimpressive book. Why We Want You to Be Rich is a thinly veiled infomercial for more financial-advice products from Kiyosaki, Trump and their minions. They sell positive thinking and can-do haziness — specific details cost extra.

Why We Want You to Be Rich seeks first to scare you silly. The middle class, according to the authors, is shriveling, sapped by the falling value of the dollar, rising national debt, lower wages, higher oil prices and baby-boomer retirement. The upshot: America is headed for a two-class system. In the future, the rich will live above the fray of national collapse while the rest of us gnash our teeth.

What to do? Kiyosaki offers a “financial education.” Trump spins plenty of anecdotes and stories. But the result is more gristle and flab than real meat.

Forget mutual funds and modern portfolio theory, Kiyosaki argues for most of the book. Instead try investing in real estate, especially if you borrow money from the bank to do it. Just leverage your way to a portfolio of real estate and small businesses that will generate enough income to retire to Easy Street.

Still not sure how to do that? Well, buy more books and attend more conferences featuring — you guessed it — Kiyosaki and Trump.

If this book were a football broadcast, Kiyosaki would be the play-by-play announcer and Trump would do color. That is to say, the book is more Kiyosaki’s than Trump’s. At the end of each chapter, The Donald meditates on the wisdom Kiyosaki has set forth. Among his insights are that he enjoys golf, he was quite the baseball player in his youth and he likes to visit Los Angeles from time to time.

To be fair, the book’s introduction tells readers this is not a how-to book. A disclaimer on the cover would be more appropriate. Why We Want You to Be Rich pretends to explain why the rich are different and to outline the benefits of wealth. The Great Gatsby by F. Scott Fitzgerald does a better job. If you are genuinely interested in learning more about real estate investing, which is not for the faint of heart, check out Investing in Real Estate, by Andrew James McLean and Gary Eldred.

From Kiplinger.com