Student Vs. Debt

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Panhandling for Student Loans

Just when college is over and you step into the real world, you realize you have a ton of debt that you have to pay. It may be the last thing you want to think about but it is important to learn about the student loan repayment process. Knowing what repayment options there are available can help you decide which one is the most suitable. With the right information, you could even have your interest rate reduced or be forgiven completely of the loan.

Before loan servicers come knocking on the door, they allow a short grace period before repayments are due. Students who borrowed Federal Stafford loans enjoy a grace period of six months. During this time, no interest will accrue on their loans. Those who got Federal Perkins loans are entitled to a nine-month grace period. Unfortunately, interest accrues on these loans. The losers of the bunch have to be those who took out PLUS loans. You have no grace period. Interest begins to accumulate almost immediately. However, you do not need to worry though. Everyone gets to choose from six different repayment plans. Continue reading →

Five Graduate Degree Programs That Don’t Pay Off

  • How much is your graduate degree worth? 
  • Will you land that better paying job?

Recently, I highlighted the ROI (return on investment) of undergraduate college majors. In this article, the focus is on a graduate degree. Since the economy tanked, many people of all ages have headed back to school to enhance their education. The idea is simple, with more education under their belt, they’ll be seen as more desirable to employers and likely earn more income. But is this always the case? Let’s find out.

Got Lucky

Five Graduate Degrees That Don't Pay Off

courtesy of vitthal_c11

Let’s look at my situation first. If you’ve been reading my blog, you know that I went back for my Masters in Counseling (graduated in 2010) and made a career change to become a high school guidance counselor. While I was able to land a guidance counselor position three months after graduating, thirty out of the forty student graduating class did not land a guidance position by September 1st (after September 1st, schools really do not hire very much). So about 75% of my fellow grad students did not land a full-time job in the field they went to graduate school for. Why was I one of the fortunate ones? I can speculate, but in another article I will cover what I call the essentials of preparing for a job interview. Continue reading →

Obama Preserves Student Loan Interest Rate

Obama’s Got Your Back

Obama’s got your back – for one year at least. That’s the big news out of Washington yesterday, as Congress approved a bill that will maintain the rate on subsidized Stafford federal loans at 3.4 percent for the coming academic year.

The interest rate was going to double, yes double, to 6.8 percent on July 1. The House vote was 373 to 52 to approve the bill, which was attached another bill funding highway projects. The Senate approved the deal with a 74-19 vote, so it now heads to the White House for Obama’s autograph.

(courtesy of flickr: jetheriot)

This deal will save some of you college students across the country an average of $1,000 on your loan repayments. Not bad, right?

Since we’re on the topic of loans, let’s just cover the basics quickly. As an undergrad, you are eligible to receive two types of Stafford loans: subsidized and unsubsidized.

With the subsidized loan, the government pays the interest on the loan while you are enrolled at least half time, and the current rate is set at 3.4 percent. With the unsubsidized loan, students accumulate interest while you are in school, at a current rate of 6.8 percent. Continue reading →

Scholarship Scams – Buyer Beware

One of the worst things I hate to see is a scam, especially one targeted at students. College students are hungry for any type of financial aid these days, so ruthless individuals have decided to prey on their dire situation. On several occasions, students have come to me with an envelope from a scholarship board or scholarship foundation. Upon reading the enclosed letter, I was able to decipher that it was likely a scam.

Proceed With Caution

So today I have decided to inform you of scholarship scams. According to the Federal Trade Commission (www.ftc.gov), the number of scams has affected over 175,000 victims, totally over $22 million in injury/fraud. That’s pretty scary. Continue reading →

Dating on a Budget

As a young person in the dating world, finding great deals for great dates  can be daunting, especially in today’s economy.  You want to have a great time and woo your date but do not want to break your bank account at the same time.  You have to be a smart dater and realize there are great options out there for you.

Great Cost Saving Date Ideas

One of the best resources today is to sign up for the website LivingSocial.  This website will provide you great deals, discounted tickets, and other coupons for great activities right in your living area.  All you have to do is sign up at LivingSocial and you will soon receive deals on a daily basis.  Most times, you will have up to five or six local restuarants, activities, or events listed and all you have to do is select which one you want to take your girlfriend on.

Another great cheap date idea generator is GroupOn.  Similar to LivingSocial, GroupOn will provide you great deals on local events, entertainment, restaurants, bars, etc.  However, the idea with groupon is that it is designed for a group of people, which can make for fun outings especially during your college years.

The two above websites will require you to shell out some money.  For those who want to save even more, you may ponder the idea of local festivals.  In most cities and small towns, there are annual festivals which offer great entertainment, local vendor exhibits, and sometimes local bands or performances. Continue reading →

Get The Grades to Get Paid!

What is one of the best ways to pay for college? If you answered “Dad’s/Mom’s bank account,” that is not the answer I was looking for. In my opinion, one of the best ways to find funding for your college tuition is to put in the hard work and get the best grades you possibly can. It is a lot of hard work, but I can assure you that it will pay off somehow or another. In some instances, you could earn a serious amount of scholarship money. I recently reviewed the top 5 Senior profiles at a local high school and averaged their scholarship offers. Take a look below:

Show Me The Money $$$

  1. LP averaged 100k
  2. DS averaged 165k
  3. MS averaged $58k
  4. CB averaged $86k
  5. JP averaged $107k

These students have now committed to New York University, Boston University, Rutgers University, Columbia University, and University of Pennsylvania.  Not bad, huh? In addition, they gained entrance to schools like Princeton, William & Mary, and George Washington. As you can see, they certainly have some solid backup schools as options.

So let’s have a scholarship sharing activity in the comments below. Please mention the college and your scholarship offer. My hope is that younger students in high school will see some of your scholarship offers and be inspired to raise their grades.

 

 

 

What’s the ROI of Your College Major?

When I first went to UC-Berkeley, I really had no idea what college major I was going to decide upon. I was not set on anything other then experiencing all that college is about. That meant exploring San Francisco, hanging out, partying, and occasionally studying. If I were to do it all over again, I would not recommend my strategy. Today’s economy and job situation have made it quite different. Although I was in college not that long ago, times have certainly changed. When I was nearing graduation, many friends of mine had already landed jobs. Today college graduates face a much bleaker job market. If you do not believe me, take a look around. Millions of college graduates are without jobs.

College is no game, and just picking a major out of a hat is not recommended. One point to consider is, what is the ROI of your major? What does ROI stand for anyway? ROI is slang for Return On Investment. In the business world, everyone talks about ROI. How about in the education world? Not so much, but let’s try to change that. The formula involves basic math. In our situation, “gain from investment” could be defined as a future yearly salary and “cost of investment” will be the cost of the 4 year tuition. Picture it as:

 

 

Below I have included a chart that shows the ROI of various college majors (from CitiBank’s website studentloan.com, click on the image and enlarge). The truth, as they say, is in the numbers.

 

Wait…Numbers Don’t Lie – Or Do They?

I found this great chart online to share with you. If you look at the last column titled “Years To Break Even” you will see that many degrees only require 3-4 years of employment in order to break even. Please do not be fooled by that number. Those numbers would be accurate if you did not have rent/mortgage, car payment, food expenses, cell phone bill, utility bills, etc. Sure if you have all of  your expenses paid for, it might only take you 3 years to pay back a college tuition cost totaling $110,000 with a teacher salary of $35k a year. But go ask most of your teachers how long it took them to “break even” and I bet you’ll get a much higher number than a measly 3 years.

Take a good look at the chart. Are these numbers what you imagined them to be? Have you considered what the ROI on your college major is and its impact on your financial future? Please comment below if you have any thoughts about what you discover, I’m interested in what you have to say.


 

 

Student Debt and the Class of 2010

Hi everyone, I just wanted to share with you some factual research to give you an idea as to how you fare compared to the average student debt in your state. So I pulled some great information for you from http://projectonstudentdebt.org/.  This site reports that:

Two-thirds of college seniors graduated with loans in 2010, and they carried an average of $25,250 in debt. They also faced the highest unemployment rate for young college graduates in recent history at 9.1%. Our new report, Student Debt and the Class of 2010, includes average debt levels for the 50 states and District of Columbia and for more than 1,000 U.S. colleges and universities.

Below is the spreadsheet of their interactive map for easy viewing and printing. Scroll down to your state, compare yourself below, and of course share your comments!

State Summary

  |

Click a column header to sort
Percentage of Graduates with Debt and Average Debt of those with Loans, by State
Class of 2010 Institutions (BA-granting) Graduates
State Average
Debt		 Rank % with debt Rank Total Usable % Represented
in Usable Data
Alabama $ 24,821 14 56% 29 33 16 68%
Alaska $ 22,717 27 50% 40 4 4 100%
Arizona $ 18,454 45 47% 45 11 6 99%
Arkansas $ 21,408 35 57% 27 23 10 59%
California $ 18,113 46 48% 43 127 73 85%
Colorado $ 22,017 32 55% 33 22 16 86%
Connecticut $ 25,360 13 61% 21 23 14 88%
Delaware $ 21,500 34 50% 40 6 3 72%
District of Columbia $ 24,191 17 54% 36 9 7 90%
Florida $ 21,184 37 49% 42 75 29 85%
Georgia $ 18,888 44 55% 33 53 30 85%
Hawaii $ 15,550 49 38% 50 7 2 64%
Idaho $ 24,178 18 66% 11 9 3 43%
Illinois $ 23,885 20 62% 18 76 43 75%
Indiana $ 27,001 8 62% 18 50 35 91%
Iowa $ 29,598 3 72% 4 35 24 93%
Kansas $ 22,280 29 57% 27 29 11 68%
Kentucky $ 19,375 43 58% 25 32 23 96%
Louisiana $ 24,548 16 48% 43 26 11 64%
Maine $ 29,983 2 68% 7 19 10 74%
Maryland $ 21,750 33 54% 36 34 17 67%
Massachusetts $ 25,541 12 63% 16 81 48 75%
Michigan $ 25,675 11 60% 23 58 32 87%
Minnesota $ 29,058 4 71% 5 38 27 81%
Mississippi $ 22,142 30 52% 39 17 6 70%
Missouri $ 22,601 28 65% 14 54 22 70%
Montana $ 22,768 26 65% 14 10 7 93%
Nebraska $ 21,227 36 62% 18 24 11 58%
Nevada $ 16,622 47 39% 49 8 3 94%
New Hampshire $ 31,048 1 74% 2 16 9 76%
New Jersey $ 23,792 21 66% 11 37 19 73%
New Mexico $ 16,399 48 56% 29 10 4 40%
New York $ 26,271 10 61% 21 176 84 71%
North Carolina $ 20,959 38 53% 38 59 33 70%
North Dakota N/A N/A N/A N/A 13 7 65%
Ohio $ 27,713 7 68% 7 80 44 85%
Oklahoma $ 20,708 40 56% 29 28 14 76%
Oregon $ 23,967 19 63% 16 29 17 72%
Pennsylvania $ 28,599 5 70% 6 126 77 79%
Rhode Island $ 26,340 9 67% 9 10 6 71%
South Carolina $ 23,623 23 55% 33 35 17 77%
South Dakota $ 23,171 25 75% 1 13 7 76%
Tennessee $ 19,957 42 46% 46 48 29 88%
Texas $ 20,919 39 56% 29 90 47 73%
Utah $ 15,509 50 44% 47 9 8 91%
Vermont $ 28,391 6 66% 11 18 11 77%
Virginia $ 23,327 24 58% 25 44 36 96%
Washington $ 22,101 31 59% 24 30 16 53%
West Virginia $ 23,678 22 73% 3 21 14 47%
Wisconsin $ 24,627 15 67% 9 37 24 77%
Wyoming $ 20,571 41 42% 48 1 1 100%

Go directly to the interactive map here http://projectonstudentdebt.org/state_by_state-data.php

If you have questions about this post, please take the time to comment and then share the post on your social networks by clicking a few of the social buttons.

Your comments are always welcome,

Kevin

Are Remedial College Courses a Waste?

A number of recent high school graduates are going to require remedial college courses in order for them to “catch up” and prepare them for regular college coursework.  Some of these students may have barely eked out a high school diploma and had deficiencies in their math, reading, or writing skills.  For many students, these classes are absolutely necessary for them to progress to the regular college courses.  These classes do not fulfill degree requirements and usually cost the same as regular courses.  However, students are struggling in these remedial courses.

 

Some Startling Statistics

  • 1.7 Million college students are steered to remedial classes
  • The expense of these courses runs about $3 billion annually
  • 1 in 10 remedial students graduate from community college within three years
  • More than 50% of students entering two-year colleges are placed in at least one remedial course
  • More than 20% of students entering four-year colleges are placed  in at least one remedial course
  • Compared to a year ago, average in-state tuition and fees at four-year public colleges rose an additional $681

The nonprofit group, Complete College America (http://www.completecollege.org/) has conducted research on this topic and reports that “half or more remedial students would be better off being placed in required classes and having the schools building in extra help, such as tutors or more frequent class meetings.   The president of Complete College American, Stan Jones, remarks that…

“Simply putting students in three levels of remedial math is really taking their money and time with no hope of success.”

At a time when college costs are rising, the last thing students need are classes that aren’t going to get them towards a degree.  Are you one of the many students who recently graduated who may need one more remedial courses to get back on track?  How do you feel about being forced into these courses?  Please comment and let me know.

If you have questions about this post, please take the time to comment and then share the post on your social networks by clicking a few of the social buttons.

Your comments are always welcome,

Kevin

 

Much thanks to Heather Hollingsworth from http://www.huffingtonpost.com/2012/05/29/remedial-college-classes-_n_1552313.html for the statistics. Credit Chris Metcalf for the photo.

 

 

 

 

 

Student Vs. Debt

Welcome to Student Vs. Debt! This website is designed to help you become a financially savvy student (and beyond). As a guidance counselor, I have met with hundreds of college bound students who had to take on student loan debt in order to chase their educational dreams. My prevailing concern is that many of these students had little idea what they were getting themselves into. As a former college student, I have had my share of student loans and I personally cannot stand debt. I’ve paid off my student loans already and I will share with you my process as well as advice from others on how to manage your student debt repayment.

Your journey starts here. Your mission, to become a smart, savvy student. My goal is to guide you from high school to college to graduation and beyond, and all along the way, I want you to be smart about your finances. Subscribe with your email and each week I will share with you tools, tricks, and just good advice that you should follow if you want to be debt free from your student loans.