Dear Dr. Crespin,

I am a busy exec burning the candle at both ends. Actually, calling me a workaholic would probably be an understatement. Non-stop emails, conference calls, meetings, reports. I am under the gun and in the office morning, noon, and night (weekends, too). The bottom line is that the responsibility for the future of the company rests on my shoulders and it’s a huge load to carry. Burn out seems almost inevitable in my line of work and the only solution I can see is to keep working harder and putting in longer hours. To add to the stress, my oldest daughter is a college sophomore majoring in “Communications and student loans.” Every time we call her, she says she’s swamped with classes, campus activities, and her social life. Why would either of us spend the virtually non-existent free time we have on leadership education?

Sincerely,
Overwhelmed Exec

Dear Overwhelmed Exec,

Thanks for your response. That’s a great question””for both of you! Sounds like your daughter and you could benefit from leadership education programming. Those who participate in leadership education acquire vital information and skills to enhance their productivity and professionalism.

Self-assessments, administered and interpreted by certified trainers and psychologists, play a key role in leadership education. The results offer new insights about yourself and illuminate areas for growth. By utilizing leadership education, you gain:

Ӣ Deeper self-awareness of your communication, conflict resolution, and leadership styles.
Ӣ Greater understanding of your specific strengths, challenges, and preferences.
Ӣ Skills for better time management and working more effectively with others.
”¢ Techniques to motivate others and empower others’ optimal performance.
Ӣ Clearer, more innovative vision for yourself and for your organization.
Ӣ More involvement in your community (i.e., civic engagement).
Ӣ Renewed motivation and sense of purpose.

In your daughter’s case, I recommend she build upon her campus involvement and join a student leadership program. Not only will it benefit her personally, but she’ll be more attractive to employers when she graduates if she has both leadership experience and training. And guess what else? A better job for her means she can pay back her student loans much more quickly, which would take pressure off you.

I urge you to pursue a specific kind of leadership education called executive coaching. For example, check out the Center for Creative Leadership www.ccl.org/; it has over 35 years of experience, an outstanding reputation, and plenty of options tailored to your needs. Think of it as an investment in yourself and your own success, not to mention your company’s. Give it a try and I think you’ll see it’s more than worth your valuable time.

Best of luck!

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More and more people, students and employers alike, are turning to leadership education for a competitive edge. Northeastern University www.neu.edu, famous for pioneering Co-op, has also been ahead of the trend in leadership education. A few years ago, I facilitated and designed the curriculum for LEGO (Leadership Education Growth Opportunities)–NU’s developmental leadership program.

My classes covered topics such as conflict resolution and communication styles, gender and leadership styles, and multicultural awareness in the workplace. Each session involved self-assessment, interactive activities, and group discussion. Participants in the program were undergrads active on-campus, eager to increase their emerging leadership skills, who responded to the trainings with lots of enthusiasm.

The leadership program, that I helped create and teach, has grown tremendously over the years. LEGO flourished with more student leaders, more faculty trainers, more funding, and more university buy-in and support. Best of all, NU now features its own Student Leadership and Engagement Office, which provides undergrads with five tiers of free leadership training. When NU students graduate, they receive another bonus; their participation in LEGO is officially documented on their co-curricular transcript.

NU’s program has even attracted some world famous luminaries; Maya Angelou, the renowned poet, recently inspired a packed campus auditorium with her words of wisdom as part of the Leadership Office’s summer lecture series. Here’s wishing NU’s leadership education program, and those like it, continued success!

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I have three wonderful grandchildren. While some might argue it’s too soon to think about college, with the oldest being 6-years old and the youngest 2, I’m of a generation that believes it’s never too early to plan for the future.

I worked hard all my life, saved money and planned for my retirement. Now, I’d like to see the fruits of my labor and wise investment choices pay off for my grand kids. I’ve spoken with friends and my financial planner (my estate is valued at 2.5 million), but still am not clear on the best way to proceed that factors in the yearly climb of tuition fees and living expenses.

The merits of 529 plans have arisen repeatedly in our conversations, but I’m not sure if it’s the best choice. I want to leave the legacy of a great education to the next generation, but what if some of them decide not to attend college. My wish is for all of them to go, but one never knows what the future holds. What would happen to a saving plan should one or all decide against college?

One of my golf buddies recommended I visit your site in an effort to clarify my savings options. What does 401Kid advise?

Sincerely,
Generous Grandfather

Thank you for writing. You ask some great questions. Here are some answers. For families of similar means, 401kid can remove contributions and any future earnings from your taxable estate and maintain control of the money if you are the 529 Plan account owner.

Additionally, there are several gift tax benefits of which you might take advantage. You can give monetary gifts to anyone without owing gift tax, as long as gifts do not exceed annual exclusion amounts. This is true of contributions to a 529 Plan. There is an additional benefit, specific to 529 Plans, that allows you to contribute a large amount of money free of gift tax in a single year.

Annually, you may contribute up to $12,000 per student (or annually up to $24,000 per student if you and your spouse contribute) without being subject to gift tax, or contribute up to $60,000 per student in a single year (or up to $120,000 per student in a single year if you and your spouse contribute) without owing any gift tax.

This is a unique feature of 529 Plans. You will need to file a gift tax return and treat the gift as if it were made in equal payments over 5 years. To avoid gift tax, you should make no additional gifts to the student during that 5-year period. If you spread out your contribution over 5 years for gift tax purposes, a portion of the gift would return to your estate in the event of your death during the five-year period.

A 529 Plan is a great way to invest for future college expenses, but it also offers benefits for estate planning. If your gross estate is valued at greater than the applicable exclusion amount of $2,000,000 for federal estate taxes for 2006, you may be looking for ways to reduce its value in order to minimize or avoid estate tax for the beneficiaries of your estate.

A 529 Plan allows you to remove contributions and future earnings from your taxable estate and maintain control of the money if you are the 529 Plan account owner. This combination of factors is unique to 529 Plans. With other types of accounts, if you maintain control of the assets, the money is considered part of your estate.

Grandparents need to keep the federal generation-skipping transfer tax (GST Tax) in mind when contributing to a grandchild’s 529 account. The GST Tax is a tax on transfers made during your life and at your death to someone who is more than one generation below you, such as a grandchild. The GST Tax is imposed in addition to (not instead of) federal gift and estate taxes. Like the applicable exclusion amount, though, there is a GST Tax exemption, which is $2 million in 2006. No GST Tax will be due until you’ve used up your GST Tax exemption, and no gift tax will be due until you’ve used up your applicable exclusion amount.

A 529 Plan may allow you to invest for future college expenses while you take advantage of estate planning and gift tax benefits. You should talk with your tax or legal adviser for information specific to your tax situation and investment planning. The availability of tax or other benefits may be conditioned on meeting certain requirements. Non-qualified withdrawals are subject to federal and state income taxes and a 10% penalty.

Please visit www.401kid.com/MediaCenter/The Grand Education Savings Plan_021505.pdf for more information. I hope this is helpful and thanks for taking the time to write.

Kind Regards,

Dr. Tara J. Palmatier, Psy.D.

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