scholarships http://www.wisebread.com/taxonomy/term/9453/all en-US Should You Save for College Using a 529 Prepaid Tuition Plan? http://www.wisebread.com/should-you-save-for-college-using-a-529-prepaid-tuition-plan <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/should-you-save-for-college-using-a-529-prepaid-tuition-plan" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_saving_for_education.jpg" alt="Woman saving for education" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Most parents with college-bound kids know about the traditional 529 college savings plan. It allows parents or grandparents to put money into a tax-advantaged savings or investment account that can later be cashed in to pay for college expenses. But did you know that some states &mdash; and a large consortium of private schools &mdash; offer another kind of 529 plan as well?</p> <p>It's called a <em>529 prepaid tuition plan</em>. With this kind of plan, you use your college savings dollars to buy tuition credits, locking in today's tuition prices. Considering how much news there is about the skyrocketing cost of college, this seems attractive in many ways. Parents can pay for college now and not worry that price increases will outpace their earnings. Better yet, a prepaid tuition plan is an investment that shouldn't ever go down in value &mdash; if you buy a credit worth a year of college now and the stock market crashes next week, you still own a year of college as long as the program delivers on its promise. (See also: <a href="http://www.wisebread.com/5-smart-places-to-stash-your-kids-college-savings?ref=seealso" target="_blank">5 Smart Places to Stash Your Kid's College Savings</a>)</p> <p>However, there are a number of factors to consider before committing to this lesser-known type of college savings plan. Here are some questions you need to ask.</p> <h2>What if my student doesn't go to the selected college?</h2> <p>Plans can change: Maybe you've been gung ho about your child attending your alma mater or the local state college, but your child isn't interested in either. Or, maybe your kid wants to follow in your footsteps and attend MIT, but doesn't get accepted. What happens to your prepaid tuition savings?</p> <p>You'll have to read the fine print to find out what you will walk away with if the student doesn't use the credits you purchased at the intended university. Any plan will likely allow you to change the beneficiary. For example, if Sally doesn't want to go to the University of Illinois, you can use her credit for her little sister instead. The Private College 529 Plan, which has nearly 300 participating schools including Stanford and Boston University, will also allow participants to roll their balance over into a traditional 529 college savings plan.</p> <p>In addition, various states' plans have provisions for using purchased credits toward other schools. For instance, Florida's prepaid tuition program is designed to be used at state universities and colleges, but funds can also be used for out-of-state or private schools.</p> <h2>What if my child gets a scholarship or doesn't go to college?</h2> <p>Again, provisions for refunds vary by plan. Some will refund the amount of tuition the plan would have covered. Under certain circumstances, some plans will pay you only what you put in &mdash; which would be a major loss of investment growth if the money sat in the account for years.</p> <h2>Will prepaid tuition be a better investment than stocks and bonds?</h2> <p>No one can predict what the markets will do. On the other hand, prepaid tuition programs typically offer participants a predictable outcome: Pay in X amount and you will receive a certificate for a semester of college. As long as the plan does what it promises, prepaid tuition plans won't lose value. However, this is no guarantee that you will end up with more value than you would have if you'd invested in the market.</p> <p>By way of comparison, private college tuition rates increased 2.4 percent per year in the past 10 years, and the cost of public four-year colleges increased 3.5 percent per year, according to the College Board. During the same decade, the S&amp;P 500 increased an average 7 percent &mdash; even taking the 2008 crash into account. So if you invested in a prepaid college fund a decade ago, your discount on present-day tuition will only equal half as much as the gains you would have gotten if you'd put the money in a traditional 529 savings plan that matched the S&amp;P 500's performance.</p> <p>A prepaid plan will probably decrease your risk and ease your worries about market fluctuations, but it could cause you to miss out on investment gains when the market is doing well.</p> <h2>What if the plan runs out of money?</h2> <p>When you put money into a prepaid college plan, the plan administrators take your money and invest it, along with the money from other plan participants. When your kid is ready for college, the plan is supposed to pay the school the cost of tuition &mdash; even if its investment growth falls short of the tuition cost. This could happen in a down market.</p> <p>Plans can also fail to meet their goals if not enough new investors buy into the plan. If this happens too many years in a row, plans can fall short of their promises and leave families in the lurch. This risk attracts a lot of criticism to prepaid plans, and has pushed some states to end their programs. Before investing in a plan, find out what it guarantees and what it doesn't.</p> <h2>The bottom line: hedging market risk</h2> <p>All the 529 prepaid plans out there are different. Participating in one could help you hedge market risk that you'd otherwise face with a college savings plan, especially if you only invest part of your savings in the prepaid plan while investing the rest in the market. Be sure to read all the fine print to learn what will happen if things don't go as expected.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2Fshould-you-save-for-college-using-a-529-prepaid-tuition-plan&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2FShould%2520You%2520Save%2520for%2520College%2520Using%2520a%2520529%2520Prepaid%2520Tuition%2520Plan-.jpg&amp;description=Should%20You%20Save%20for%20College%20Using%20a%20529%20Prepaid%20Tuition%20Plan%3F"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/Should%20You%20Save%20for%20College%20Using%20a%20529%20Prepaid%20Tuition%20Plan-.jpg" alt="Should You Save for College Using a 529 Prepaid Tuition Plan?" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/carrie-kirby">Carrie Kirby</a> of <a href="http://www.wisebread.com/should-you-save-for-college-using-a-529-prepaid-tuition-plan">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-questions-to-ask-before-taking-out-student-loans">6 Questions to Ask Before Taking Out Student Loans</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-9-best-state-529-college-savings-plans">The 9 Best State 529 College Savings Plans</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/why-saving-too-much-money-for-a-college-fund-is-a-bad-idea">Why Saving Too Much Money for a College Fund Is a Bad Idea</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-ways-college-students-can-save-money-before-class-starts">8 Ways College Students Can Save Money Before Class Starts</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-your-child-can-earn-college-credits-in-high-school-for-cheap">How Your Child Can Earn College Credits in High School (For Cheap)</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance Education & Training 529 plans college higher education prepaid tuition saving money scholarships school tuition Thu, 19 Oct 2017 08:30:06 +0000 Carrie Kirby 2037240 at http://www.wisebread.com 6 Questions to Ask Before Taking Out Student Loans http://www.wisebread.com/6-questions-to-ask-before-taking-out-student-loans <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/6-questions-to-ask-before-taking-out-student-loans" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_saving_education_coins.jpg" alt="Woman saving education coins" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Americans are more burdened by student loan debt than ever, with the average graduate in their 20s making $351 a month in student loan payments. Suggested changes to the federal student loan program could have even more college students questioning just how much student loan debt they want or can afford.</p> <p>As part of its overall budget plan, the Trump administration would like to eliminate current provisions in which the government pays the interest on student loans taken out by low-income students while the borrower is still in school and for six months after graduation.</p> <p>The Trump administration is also proposing to end the Public Service Loan Forgiveness program. This program allows borrowers who go on to work for the government or for nonprofits to have the remainder of their federal student loans forgiven after they make 10 years of payments.</p> <p>Even though these potential changes might never be signed into law, just the possibility of such changes makes it even more important for students to ask the right questions before they take out federal or private student loans.</p> <p>Here are six questions you should ask before signing up for any student loan.</p> <h2>1. Have you considered all education options?</h2> <p>Your first-choice school might be the most expensive university on your list. You might be able to reduce the amount of money you borrow each year by choosing a less costly option.</p> <p>Instead of attending a private college, you might investigate a public university. Instead of going to an out-of-state school, you might consider going to school in-state, which comes with lower tuition. You could also attend a community college for two years before transferring to a private or public university for the remainder of your college years. These choices could reduce the amount of student loan debt you'll have to take on.</p> <h2>2. Can you cut out room and board?</h2> <p>The College Board reported that the average yearly cost of room and board at a public four-year university stood at $10,440 during the 2016&ndash;2017 academic year. You can save that expense if you attend a college that allows you to live at home while taking classes.</p> <p>Yes, you will lose out on some of the traditional college experience. But taking on less student loan debt might be an acceptable trade-off.</p> <h2>3. Are you borrowing too much for your potential future income?</h2> <p>Certain careers pay more than others. You need to remember this when applying for student loans. You don't want to take on huge debts if you expect to make $40,000 a year when you graduate. But taking on larger amounts of debt might be a solid financial choice if you are working toward a higher-paying degree.</p> <h2>4. How big of a student loan payment are you willing to make once you're working?</h2> <p>Borrowing money might seem easy when you're still in school. After all, you're probably not making payments on these loans yet. But once you're out in the working world, that student loan debt won't seem so benign.</p> <p>You will have to make payments each month. And these payments will come in addition to rent, car payments and, eventually, mortgage payments. Student loan payments become a huge financial burden to many. Before borrowing today, you need to consider how comfortable you'll be making those payments in the future.</p> <h2>5. Are there other types of financial aid available?</h2> <p>Before applying for a student loan, make sure you explore all financial aid options with your high school counselor, or the university you plan to attend. Many universities offer merit scholarships to incoming students. You usually don't have to apply for these scholarships. Schools automatically provide them, usually based on your academic performance. Even if you've been offered one, you might be able to persuade your university to provide you with a larger merit scholarship, especially if you are worried that you won't be able to afford the yearly tuition without financial help.</p> <p>There are other types of scholarships, too, that you should investigate. The U.S. Department of Education says that there are several ways for college students to search for scholarships and grants. They should first speak with the financial aid office at the college they are attending. These professionals often have tips for hunting down scholarship and grant money.</p> <p>They can also use the free online <a href="http://www.careeronestop.org/toolkit/training/find-scholarships.aspx" target="_blank">scholarship finder</a> offered by the Department of Education. The department also offers an online list of <a href="https://www2.ed.gov/about/contacts/state/index.html" target="_blank">state grant agencies</a> that students can search to find scholarships and grants in their states.</p> <p>Call your school's financial aid office to discuss options such as work-study programs and possible additional financial help.</p> <h2>6. Can you get by without private loans?</h2> <p>Even if you get grants and scholarships, you may still need student loans. There are two types of student loans to consider: Federal loans offered through the federal government or private loans offered by private lenders. Federal loans are preferable because they usually come with lower interest rates and more flexible repayment programs. Federal loans also provide more options if, after graduating, you find yourself struggling to make payments, including deferment and eventual forgiveness programs.</p> <p>It's far better to rely as much as possible on federal subsidized or unsubsidized student loans. The challenge is that these federal loans have limits; you can only borrow so much each school year.</p> <p>Your school might also offer its own lower-interest loans that would be cheaper than private loans. But if these options still aren't enough, you'll have to determine whether taking out less attractive private student loans to attend college is worthwhile. It might be the only option.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" data-pin-save="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F6-questions-to-ask-before-taking-out-student-loans&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F6%2520Questions%2520to%2520Ask%2520Before%2520Taking%2520Out%2520Student%2520Loans.jpg&amp;description=6%20Questions%20to%20Ask%20Before%20Taking%20Out%20Student%20Loans"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/6%20Questions%20to%20Ask%20Before%20Taking%20Out%20Student%20Loans.jpg" alt="6 Questions to Ask Before Taking Out Student Loans" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/dan-rafter">Dan Rafter</a> of <a href="http://www.wisebread.com/6-questions-to-ask-before-taking-out-student-loans">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/should-you-save-for-college-using-a-529-prepaid-tuition-plan">Should You Save for College Using a 529 Prepaid Tuition Plan?</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-unique-ways-millennials-are-dealing-with-student-loan-debt">7 Unique Ways Millennials Are Dealing With Student Loan Debt</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-things-financial-aid-might-not-cover">6 Things Financial Aid Might Not Cover</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/should-you-borrow-student-loan-money-from-amazon-prime">Should You Borrow Student Loan Money From Amazon Prime?</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-ways-to-make-the-most-of-your-student-loan-grace-period">4 Ways to Make the Most of Your Student Loan Grace Period</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance Education & Training college debt repayment federal loans higher education private loans scholarships student debt student loans trump tuition Tue, 18 Jul 2017 08:00:08 +0000 Dan Rafter 1983760 at http://www.wisebread.com 10 Ways for College Students to Save Loads of Money http://www.wisebread.com/10-ways-for-college-students-to-save-loads-of-money <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/10-ways-for-college-students-to-save-loads-of-money" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/iStock-609683672.jpg" alt="College student learning how to save loads of money" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Between big expenses like tuition and housing, and smaller everyday expenses such as school supplies and coffee, the costs of being a student can rack up fast. According to the College Board, tuition, fees, and room and board at a public four-year in-state school cost an average of $20,000 a year.</p> <p>But there are a lot of ways for students to save money. Here are 10 ways to tackle expenses of every size. (See also: <a href="http://www.wisebread.com/12-easy-ways-to-avoid-student-loan-debt?ref=seealso" target="_blank">12 Easy Ways to Avoid Student Loan Debt</a>)</p> <h2>Big savings</h2> <p>Tuition and housing make up the bulk of student spending, so finding ways to reduce those costs can pay off big.</p> <h3>1. Look at off-campus housing for lower rent</h3> <p>While living on campus can be a fun college experience, university housing often comes with a big price tag. Room and board at my private university cost approximately $10,000 a year &mdash; that's about $1,250 for the eight months school is in session.</p> <p>You may be able to find more competitive rents off campus. Check websites for apartment listings in your college town.</p> <p>Also talk with your university's housing department about opportunities for <em>free </em>housing that may be offered if you provide advising services to younger, first-year students. This could result in huge savings and be an interesting college experience.</p> <h3>2. Apply for scholarships to save money on tuition</h3> <p>Tuition is often the most expensive part of going to school, with some private institutions in the United States charging as much as $33,000 &mdash; and that doesn't include room and board. While federal financial aid can help, it's often not enough.</p> <p>There are a plethora of scholarships available, both locally and nationally, that you can apply for. The best part is, unlike federal student loans, scholarships don't have to be repaid. To find them, check with your university's financial aid office, your high school guidance counselor, your parents' employers, and organizations related to your field of study. Also try using the U.S. Department of Labor's <a href="http://www.careeronestop.org/toolkit/training/find-scholarships.aspx" target="_blank">free scholarship search tool</a>.</p> <h2>Medium savings</h2> <p>Textbooks, entertainment, and transportation all add significant costs to your overall college bill. Try trimming or offsetting these expenses with these suggestions.</p> <h3>3. Save on textbooks</h3> <p>Textbooks can have a very high price tag. When I was a student, I remember books costing up to $100, and sometimes even more for specialized course booklets that included all of the semester's reading assignments. With multiple classes and most classes assigning at least five books per semester, it was easy to spend at least $500 on books alone in a semester, or $1,000 per academic year.</p> <p>Buying used textbooks is one way to save. In my experience, they cost about half the price of new books. You can buy books directly from students who have already taken the course or check online retailers like Amazon for deals on used books.</p> <p>Another option is to rent your textbooks, which means that you will pay a smaller amount upfront to the bookstore, but that the book won't be yours to keep at the end of the semester. <a href="https://www.chegg.com/etextbooks" target="_blank">Chegg</a> and <a href="http://amzn.to/2rqTvcz" target="_blank">Amazon</a> both offer rentals, and both claim you can save up to 90 percent by renting.</p> <p>Alternatively, you can cut out the cost of books entirely by checking them out for free at your college library. Supplies are limited, so you may have to wait to get the book you need, but you can't beat the price. (See also: <a href="http://www.wisebread.com/20-places-to-buy-or-rent-textbooks?ref=seealso" target="_blank">20 Places to Buy or Rent Textbooks</a>)</p> <h3>4. Sell back your textbooks at the end of the semester</h3> <p>Chances are, you can get some of your textbook investment back by selling your books when you're done using them. You can likely make back a couple hundred dollars at the end of the semester. One easy option is to use Amazon, which has a streamlined process for <a href="https://www.amazon.com/Sell-Books/b?node=2205237011" target="_blank">buying back books</a> for up to 80 percent of what you originally paid. Amazon will then sell the book used. You can also check with your university bookstore, as it may have a program in place to buy back books.</p> <p>A third option is to sell the book yourself. By cutting out the middleman, you'll get to pocket more money from the sale. You can ask around, or post notices on bulletin boards or online to find other students who are going to take the same class. If the book is required reading, chances are you will be able to find a buyer fairly easily with just a little bit of extra work.</p> <h3>5. Participate in studies to earn cash</h3> <p>If you don't have the time to commit to a full-time job, there are plenty of ways to earn on campus without the commitment. Check in with different departments about research studies that they may be running.</p> <p>These opportunities can range from writing tests to filling out questionnaires. Once, I was paid $100 an hour to have scans taken in an MRI machine.</p> <h3>6. Take advantage of free facilities</h3> <p>Familiarize yourself with everything your college or university offers on campus. You can save $50 and up a month on an expensive gym membership, for example, if you have access to this type of amenity for free as a part of your tuition. Some schools also offer free tutoring, software, legal services, and psychological counseling. All of these can save you money.</p> <h3>7. Reduce transportation costs</h3> <p>If you live off campus, consider ditching your car for an economic bicycle that will get you to class for free, saving you on the cost of gas, maintenance, and parking. Public transportation may be another way to get where you need to go without paying car and parking expenses. When you go home at the end of the semester, check with friends and on-campus forums to find out if you can find a ride with someone and split the gas costs.</p> <h2>Small Savings</h2> <p>Even small savings can add up. Check out these ways to pare your everyday expenses.</p> <h3>8. Save on coffee</h3> <p>Some college students have a costly coffee dependency, and at a cafe you can expect to spend as much as $3 to $4 on a coffee. If you are buying coffee once or twice a day, in a month you could be spending over $150!</p> <p>While a coffee maker might cost you a little bit up front, if you are a big coffee drinker it will pay for itself within the first month. Plus, with Italian coffee makers (around $30, depending on which size pot you choose), you can get stronger coffee and a better buzz for late night studying or just getting to your 5 o'clock class.</p> <p>The <a href="http://amzn.to/2pWBu3E" target="_blank">Handpresso</a> is a handheld espresso machine that is as convenient as it is cheap. Simply pump, add boiling water, a coffee pod or loose espresso grounds, and press a button for delicious coffee. Based on my experience buying ground coffee and milk in the grocery store, an Americano with milk only costs around 30 cents per coffee using this machine.</p> <p>If you make two 30-cent coffees per day, rather than buying two at $3 a cup, by the end of the year you could save nearly $2,000 in coffee expenses!</p> <h3>9. Find free events and entertainment</h3> <p>Check if your university offers free lectures, movie screenings, concerts, or other arts events instead of paying big bucks to go to ticketed events. You'll be surprised how much you can do for free with just a student ID. Signing up for a newsletter will help you to stay on top of the cool speakers that the university is hosting.</p> <p>Also use your college library, not just for studying but for entertainment options. Take advantage of newspapers, magazines, and movies that the library offers you to check-out, all completely free. By opting for this type of entertainment and reading materials, you can save a lot of money. With the average movie ticket costing around $9, if you instead go to two free movies per month or watch DVDs from the library, you'll save over $200 by the end of the year.</p> <h3>10. Stay in style for less</h3> <p>Trends move fast, and buying new clothes all the time can add up to significant costs for students. You don't have to completely forget about fashion for four years to stick to a tight budget. Check out thrift stores for fashions at a tiny fraction of the cost of new clothing. Also, find out about consigning the items you no longer want at the end of the semester.</p> <h2>Doing the math</h2> <p>Each item on this list may not seem like a lot &mdash; a coffee here, a movie ticket there &mdash; but when you add it all up over the course of the year, it can mean big savings for students. It's worth the effort to examine which of these costs you could cut, and then start realizing those savings.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/amanda-gokee">Amanda Gokee</a> of <a href="http://www.wisebread.com/10-ways-for-college-students-to-save-loads-of-money">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/should-you-save-for-college-using-a-529-prepaid-tuition-plan">Should You Save for College Using a 529 Prepaid Tuition Plan?</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-things-financial-aid-might-not-cover">6 Things Financial Aid Might Not Cover</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-ways-you-can-cut-costs-right-before-you-retire-0">6 Ways You Can Cut Costs Right Before You Retire</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-questions-to-ask-before-taking-out-student-loans">6 Questions to Ask Before Taking Out Student Loans</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-easy-way-to-save-up-a-big-travel-budget">The Easy Way to Save Up a Big Travel Budget</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Frugal Living Education & Training coffee college students cutting costs entertainment room and board saving money scholarships textbooks transportation tuition Tue, 23 May 2017 08:30:12 +0000 Amanda Gokee 1949206 at http://www.wisebread.com What to Do When You Can't Afford Your Child's College Education http://www.wisebread.com/what-to-do-when-you-cant-afford-your-childs-college-education <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/what-to-do-when-you-cant-afford-your-childs-college-education" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/iStock-168249072.jpg" alt="Learning what to do when you can&#039;t afford college education" title="" class="imagecache imagecache-250w" width="250" height="141" /></a> </div> </div> </div> <p>First comes the joy: Your child receives the thick packet from a dream university, the sure sign of an acceptance.</p> <p>But then comes the reality: that sky-high price tag.</p> <p>The college your child has just been accepted to might be asking for $30,000, $40,000, $50,000 or more in tuition each year. And if your child doesn't receive much, or anything, in merit-based scholarships from that school, you and your child will be responsible for covering those costs &mdash; often in the form of student loans that can haunt your child's finances for decades after graduation. (See also: <a href="http://www.wisebread.com/5-sobering-facts-about-student-loan-debt?ref=seealso" target="_blank">5 Sobering Facts About Student Loan Debt</a>)</p> <p>What if you haven't saved nearly enough to help cover these costs? What if you haven't managed to save anything at all? What can parents do when they can't afford their child's college education?</p> <p>The choice usually comes down to taking on tens of thousands of dollars in student loan debt or attending a less expensive alternative school. And if you can't afford the tuition at any school, there are still options in the form of scholarships, grants, and community college. (See also: <a href="http://www.wisebread.com/college/college-resources?ref=internal" target="_blank">40+ College Resources for Parents and Students</a>)</p> <h2>Rising costs</h2> <p>Tuition rates continue to rise every year. Especially at private universities, this means that tuition that is already intimidating becomes a bit more of a financial burden with each passing year.</p> <p>In its 2016 report, the College Board said that the average annual sticker price &mdash; including tuition, fees, and room and board &mdash; stood at $20,090 for in-state students at public colleges, and $35,370 for out-of-state students. The average for private colleges was $45,370 in 2016.</p> <p>There is a glimmer of good news here: Many students don't pay this full price. That's because many students receive scholarships (many offered automatically by the schools that accept them) and grants. According to the College Board's 2016 report, the net price of college &mdash; the price showing what students <em>actually </em>pay after they receive financial assistance &mdash; was $14,210 a year for tuition, fees, and room and board for in-state students at public colleges, and $26,080 for students at private colleges.</p> <p>The fact still remains that after financial assistance, paying for college is no easy task, even at more affordable public universities.</p> <h2>Student loan burden</h2> <p>Student loan debt is a financial burden for many college graduates. According to Student Loan Hero, the average college graduate from the class of 2016 has $37,172 in student loan debt, a record high. But for many students, there is no other way to pay for college.</p> <p>If you can't afford to help pay for your child's college education, student loans are an alternative. The loans, though, are far from a perfect solution. First, students can only borrow from $5,500 to $12,500 in federal subsidized and unsubsidized loans. <a href="http://www.wisebread.com/college/federal-student-loans?ref=internal" target="_blank">Federal student loans</a> are the best option because they come with the lowest interest rates and most favorable repayment terms.</p> <p>Students who must borrow more each year will have to take out private loans. Their parents can also take out private student loans for their children. Those often come with higher interest rates and less favorable terms.</p> <p>Relying completely on student loans could also set you or your children up for a tough financial future after they graduate, especially if they struggle to land a decent paying job. (See also: <a href="http://www.wisebread.com/8-surprising-ways-to-pay-off-your-student-loans?ref=seealso" target="_blank">8 Surprising Ways to Pay Off Your Student Loans</a>)</p> <h2>A more affordable school</h2> <p>Your child might dream of attending that elite private school, but an in-state public university might be a more affordable choice that can provide your child with an equally strong education.</p> <p>Explain to your children that an out-of-state private school might be a dream destination, but might also negatively affect their financial health for decades after graduation.</p> <p>Students might also attend an in-state public school for two years, taking the general education classes that they are required to complete. They can then apply again to their dream university for the final two years of their undergraduate career. This can make their entire college career more affordable.</p> <p>There's also community college. Community colleges are a far more affordable alternative to both private and public four-year colleges. Attending a community college for at least two years could leave graduates with far less student loan debt after graduation.</p> <h2>Sources of additional help</h2> <p>Many colleges automatically provide merit scholarships to incoming students, which students never have to repay. Colleges will automatically provide this financial assistance to the students they accept; students don't have to do anything to apply.</p> <p>Merit scholarships can make private universities far more affordable. Private schools generally pass out more of this aid to attract students who otherwise wouldn't be able to afford tuition at these schools.</p> <p>If your child is accepted at a school but doesn't receive any or enough merit aid directly from the university, you can always contact the institution's office of admissions or financial aid. Often, schools will allow you to fill out a hardship form as a way to request additional financial support. Colleges aren't required, of course, to provide more aid, but some might. A phone call could make a difference.</p> <p>Also search for scholarships. Your child might qualify for hundreds of scholarships, some offering significant financial help. Winning these scholarships isn't always easy, with many attracting thousands of applicants. But even earning one or two scholarships can help cut down the expense of a college education. (See also: <a href="http://www.wisebread.com/college-without-loans-where-to-find-scholarships?ref=seealso" target="_blank">Where to Find Scholarships</a>)</p> <p>Your children can also work on a part-time basis to help afford tuition. Colleges usually offer their own work-study programs that can help defray expenses. Students who volunteer to serve as residential advisers at campus dorms might receive free or discounted room and board.</p> <p>You might even be able to significantly reduce your child's yearly college costs by convincing your child to attend a school close enough to home so that your student can continue living with you. Room and board generally costs about $10,000 a year; if your child lives at home, he or she can eliminate this cost.</p> <p>College education remains an expensive proposition. But you and your child do have options, if you look for them.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/dan-rafter">Dan Rafter</a> of <a href="http://www.wisebread.com/what-to-do-when-you-cant-afford-your-childs-college-education">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-great-sources-of-financial-aid-for-switching-careers">7 Great Sources of Financial Aid for Switching Careers</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-money-moves-every-new-college-student-should-make">7 Money Moves Every New College Student Should Make</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-money-moves-students-should-make-during-a-gap-year">8 Money Moves Students Should Make During a Gap Year</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-things-you-need-to-know-about-deferring-student-loans">4 Things You Need to Know About Deferring Student Loans</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-sobering-facts-about-student-loan-debt">5 Sobering Facts About Student Loan Debt</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Education & Training college costs community colleges financial aid grants private schools public schools scholarships student loans Wed, 12 Apr 2017 09:00:10 +0000 Dan Rafter 1922478 at http://www.wisebread.com This Simple Mistake on a Credit Application May Cost You http://www.wisebread.com/this-simple-mistake-on-a-credit-application-may-cost-you <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/this-simple-mistake-on-a-credit-application-may-cost-you" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_credit_card_17698096.jpg" alt="Woman making simple mistake on credit application" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Besides your credit score, your income may play an important factor in whether you get approved for a credit card, and the amount of credit you will be approved for. But for those with freelance jobs or other variable sources of cash, determining an exact income to report can be difficult.</p> <p>See also: <a href="http://www.wisebread.com/7-credit-card-application-tips-for-the-best-chance-of-approval?utm_source=wisebread&amp;utm_medium=seealso2&amp;utm_campaign=cc_article">7 Tips for Filling Out Credit Card Applications for the Best Chance of Approval</a></p> <p>Obviously, you want to be as accurate as possible, but you also want to report the highest amount of income applicable so that you can qualify for your card. Your income is how credit card companies can determine if you are able to pay back your debt. Even if you do not plan on accumulating credit card debt, credit card companies still look at you as a debt risk. If you only say that you make $20,000 a year, then why would a credit card company want to take a chance on you with a $12,000 credit line?</p> <h2>Types of Income You Can Report on a Credit Card Application</h2> <p>Applicants over the age of 21 can list a wide range of types of income that they have reasonable expectation of access to. Here are some of the following types of income considered:</p> <h3>Personal Income</h3> <p>Put simply, this is your gross income figure. If you are a freelancer or self-employed, base this number off your total income the year before or your average monthly income multiplied by 12. For example, if you regularly make $2,500 to 3,000 per month, then reporting an income of $33,000 should be fairly accurate.</p> <h3>Spousal Income</h3> <p>As of 2013, you can count income from your spouse or partner on your application.</p> <h3>Allowances and Gifts</h3> <p>Do you regularly get a few hundred dollars for your birthday from family members and friends? You can add it to your income list.</p> <h3>Scholarships and Grants</h3> <p>This is a benefit for college students who have received scholarships and grants for the school year. If you are not accepted for a credit card, call the reconsideration line and talk about your scholarships and other redeeming qualities (i.e. leadership programs you run at school, GPA, and other accomplishments that can boost your credit worthiness).</p> <h3>Trust Fund Distributions</h3> <p>If you're fortunate enough to have a trust fund, report the average amount you expect to receive in a typical year.</p> <h3>Retirement Fund Distributions</h3> <p>Retired? Great! Don't forget to list distributions from 401Ks, IRAs, or other retirement funds.</p> <h3>Social Security Income</h3> <p>Ditto for Social Security income. List your yearly benefit amount as income.</p> <p>For borrowers between 18 and 21, only independent income can be reported. This includes personal income (including any regular allowances from relatives) and scholarships and grants. Borrowers between 18 and 21 might have better luck being added as an authorized user on a parent's account. This can help build up credit history without having to turn to high interest fee cards.</p> <h2>Types of Income You Should Not Report</h2> <p>Note that student loans do not count as income. Once you graduate, student loans become debt you must repay, and it is best not to pile on credit card debt on top of that.</p> <p>Your mortgage or equity in your home should also not be considered income.</p> <h2>Consequences of Lying About Income on Credit Card Applications</h2> <p>While you might want to gain access to a credit card, it is never a good idea to lie about your actual income. Stretching the truth on your application and getting approved can mean that you are more likely to get into debt without the income to get you out.</p> <p>On a more serious note, lying on credit card applications is considered credit card fraud, which is punishable by up to $1 million in fines and up to 30 years of prison. While these punishments are on the extreme side, individuals caught falsifying income to gain loans or credit cards have been hit with hefty fines.</p> <p>In 2012, 52-year-old New York resident David P. Gaylord faced charges for reporting an inflated income of $90,000 to $122,000 on three credit card applications in 2006. However, the IRS reported his income as $12,488 that year. Gaylord was sentenced to five years of supervised release and ordered to pay $46,914.73 in restitution.</p> <p>See also: <a href="http://www.wisebread.com/11-reasons-your-credit-card-application-was-denied-and-what-you-can-do-about-it?utm_source=wisebread&amp;utm_medium=seealso2&amp;utm_campaign=cc_article">Why Your Credit Card Application Was Denied and What to Do About It</a></p> <p>If you are still unsure about how to fill out your application, consider calling the credit card company to talk with a person who can guide you through the application process.</p> <p><em>Do you have multiple sources of non-wage income? How do you report it on credit apps or elsewhere?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/ashley-eneriz">Ashley Eneriz</a> of <a href="http://www.wisebread.com/this-simple-mistake-on-a-credit-application-may-cost-you">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-reasons-credit-is-safer-than-debit">4 Reasons Credit Is Safer Than Debit</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/prepaid-cards-about-to-get-safer-and-better">Prepaid Cards About to Get Safer and Better</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/9-family-money-matters-your-kids-dont-need-to-know">9 Family Money Matters Your Kids Don&#039;t Need to Know</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/heres-what-to-do-immediately-after-a-credit-card-breach">Here&#039;s What to Do Immediately After a Credit Card Breach</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/stupid-credit-card-tricks-how-your-credit-card-company-lies-to-you">Stupid Credit Card Tricks: How Your Credit Card Company Lies to You</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Credit Cards allowances applications credit approval fraud honesty income reporting retirement scholarships trust funds Thu, 01 Sep 2016 10:30:07 +0000 Ashley Eneriz 1783711 at http://www.wisebread.com How to Save Money on Child Care This Summer http://www.wisebread.com/how-to-save-money-on-child-care-this-summer <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/how-to-save-money-on-child-care-this-summer" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/kids_laughing_85809327.jpg" alt="Learning how to save money on child care this summer" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>School's out for the summer, and your kids are probably bouncing off the walls with excitement. However, not many jobs offer the same summer break perks, leaving you with the costly decision of finding summer child care.</p> <p>Here are some solutions to try to save money on your child care costs this summer.</p> <h2>Swap With Someone Who Has a Summer Break</h2> <p>If one of your friends is a teacher or school administrator, then they probably have a good portion of the summer off. Ask a teacher or a stay-at-home mom friend who is willing to watch your children for a few hours a week in exchange for you watching their kids on the weekend. Since many teachers and stay-at-home moms will have to stay home with their children during the weekdays, they might enjoy a weekend break.</p> <p>Just make sure that the agreement is benefiting both of you, instead of being a burden on one of you. One summer, my mom asked my neighbor to watch my sister and I. The neighbor had six children that stayed at home as is, so my sister and I were barely noticed. We had a blast hanging out with our friends, and the mom just kept her schedule as she always did. We even did chores and went to local home schooling conventions.</p> <p>In exchange, my mom was able to give her money each week, and it ended up benefiting us all. The neighbor made a little bit of extra money, my mom paid less for child care, than she would have if she sent us to day camp, and my sister and I had a blast.</p> <h2>Try Working a Flex Schedule</h2> <p>Many times your employer can be more understanding of your need for a flexible schedule during the summer months. Try to work it out with your spouse's schedule so that there will always be someone available to stay home. For example, your spouse can go into work earlier and come home earlier, while you can go in later and work later hours. Perhaps you can even work the weekends so that you have two free days to watch your children during the week.</p> <p>I have witnessed many couples do this successfully, and work it out so that their schedules overlap the majority of the time. You can then fill in the gaps with the use of a family member or a baby sitter. While this schedule will take planning and getting used to, remember it is only for a few months.</p> <p>Of course, many people do not have flexible jobs, but it is worth looking into. Even if you can work from home one day a week or come in two hours later, that is time you do not have to pay for child care.</p> <h2>Look for a Tax Break</h2> <p>Take a look at your benefits to see if you have access to a dependent care flexible spending account. If so, you can use up to $5,000 in pre tax dollars to pay for child care expenses.</p> <p>If your employer doesn't offer an FSA, you can claim the child care tax credit when you file taxes. This credit is good for $3,000 to $6,000 in expenses, depending on how many children you have.</p> <h2>Get the Most Out of Your Babysitter</h2> <p>A baby sitter might be a better deal for the summer, especially if you have more than one child. Be sure to do a background check and to find a sitter that will keep your kids engaged each day rather than parking them in front of the television.</p> <p>When you are going through the hiring process, specify certain tasks/jobs you want done. Obviously it would be unfair to request they deep clean your home, but if they can manage light cleaning, simple dinner prep, grocery shopping, or the kids' laundry, that will take the stress off your shoulders. (See also:&nbsp;<a href="http://www.wisebread.com/9-child-care-purchases-you-should-never-skimp-on?ref=seealso">9 Child Care Purchases You Should Never Skimp On</a>)</p> <h2>Look Into Camp Scholarships</h2> <p>Ann Sheets, former national president of the American Camp Association said, &quot;About 90% of resident camps and 89% of day camps offer scholarships.&quot;</p> <p>Start your search today and apply to any camp you think your child would be eligible for. Don't forget to apply for higher-end camps too, since their scholarships might cover more than you think. Try to stay flexible with your camp dates. Not sure if a camp offers a scholarship? Just contact them and ask. You might have a better chance at qualifying for a scholarship if not many people know about it.</p> <p>While kids live for summer vacation, it can be hard to deal with the costs. Most professionals will admit that their kids' summer plans look like a mismatched quilt. That is okay! Be creative and stay flexible, knowing that this is only a brief season.</p> <p><em>What are your child care plans for the summer?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/ashley-eneriz">Ashley Eneriz</a> of <a href="http://www.wisebread.com/how-to-save-money-on-child-care-this-summer">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/9-frugal-winter-activities-to-keep-kids-busy-during-holiday-break">9 Frugal Winter Activities to Keep Kids Busy During Holiday Break</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-frugal-living-skills-i-wish-my-parents-would-have-taught-me">8 Frugal Living Skills I Wish My Parents Would Have Taught Me</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-lessons-about-money-i-learned-after-having-twins">7 Lessons About Money I Learned After Having Twins</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/heres-how-your-taxes-will-change-after-you-have-a-kid">Here&#039;s How Your Taxes Will Change After You Have a Kid</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-sibling-discounts-that-can-save-you-big">6 Sibling Discounts That Can Save You Big</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Frugal Living Family activities baby sitters camp child care kids scholarships summer break summer vacation tax breaks Mon, 27 Jun 2016 09:00:11 +0000 Ashley Eneriz 1733677 at http://www.wisebread.com 8 Money Moves Students Should Make During a Gap Year http://www.wisebread.com/8-money-moves-students-should-make-during-a-gap-year <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/8-money-moves-students-should-make-during-a-gap-year" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/man_travel_selfie_58375086.jpg" alt="Man making money moves during his gap year" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Parents and soon-to-be college students are giving the gap year a second look after the White House announced that Malia Obama will be taking one <a href="http://www.nytimes.com/2016/05/02/us/politics/malia-obama-to-attend-harvard-but-not-until-2017.html?_r=1">before attending Harvard in 2017</a>. Also popularized by England's Prince Harry, who famously took time out for ranching in Australia and volunteer work in Africa in 2004, the gap year is a break between high school and the start of a person's higher education (or between college and graduate school).</p> <p>Most often, the gap year is used by young people as an opportunity to see the world, explore new cultures, immerse themselves in a nonacademic pursuit, work a job or internship, or volunteer for a cause. The goal is to gain valuable life experience before delving deeper into academics, trade school, military service &mdash; wherever your next step in life takes you.</p> <p>Of course, a year of self-exploration doesn't come free. Read on for our student guide to prepping finances for a gap year.</p> <h2>1. Start Saving a Year Out</h2> <p>How much a gap year will cost depends on how you plan to use it. So, map out your yearlong plan, estimating how much money you'll need. Of course, plans change. And that's okay. All you really need is a good estimate to get you motivated to start saving.</p> <h2>2. Open a Gap Year Bank Account</h2> <p>Now that you've got a savings goal, open up a separate bank account to house your gap year fund drive. To make your big funding goal seem more achievable, break it down into smaller, more manageable monthly and weekly goals. This will keep you from feeling overwhelmed. Next, devise a plan for reaching these mini-fundraising goals. Will you cut down on weekend spending? Will you get a part-time job or pick up extra hours at your existing gig? Whatever you decide, be sure to hold yourself accountable.</p> <h2>3. Apply for a Grant or Scholarship</h2> <p>There are plenty of grants and scholarships out there created specifically to ease the financial burden of enrichment programming and travel during the gap year. If you have interest in visiting the Middle East, for example, a grant from Unofficial Ambassadors' <a href="http://unofficialambassadors.com/our-programs/aua-mosaic-scholarship/">Mosaic Grants Program</a> can make the experience more affordable. If you have demonstrated leadership in tackling issues aimed at protecting the environment, the <a href="http://www.broweryouthawards.org/">Brower Youth Awards</a>, which is an initiative by Earth Island Institute, divvies out $3,000 scholarships to young people each year.</p> <p>Be sure to also check out any opportunities offered by your prospective university or college as well as local organizations in your area. In Humboldt County, California, for example, there's a&nbsp;<a href="http://www.americangap.org/humboldtscholarship.php">generous annual scholarship</a> that offers up to $6,000 to gap year students who are seeking participation in a program accredited by the American Gap Association. Schools including Tufts University and the University of North Carolina have financial aid programs for gap year students, as well.</p> <h2>4. Give Creative Fundraising a Shot</h2> <p>There are so many ways to rake in extra cash. Just ask the twin teens from England who used their gap year to cultivate a loyal following on a YouTube channel that has earned them <a href="http://www.telegraph.co.uk/lifestyle/9544479/YouTube-videos-funded-our-gap-year-travels.html">tons of money in advertising</a>, which funded their year of travel. Other ideas: Launch a crowdfunding campaign or host an event &mdash; battle of the bands, pool party, theatrical performance &mdash; to which you sell tickets that will cover your expenses.</p> <h2>5. Invest in Traveler's Insurance</h2> <p>If you plan to travel abroad during your gap year, organizations such as <a href="https://www.internationalsos.com/">International SOS</a> offer top-notch insurance policies that can save you hundreds or thousands of dollars should something go wrong. Let's hope you never need it. Truth be told, most of the time traveler's insurance does end up being a waste of money. But should you ever need to cover the cost of inconveniences such as a last-minute trip cancellation, emergency medical evacuation, or lost luggage, you'll be more than glad that you have it.</p> <p>Of all the expenses to skimp on while traveling abroad, don't let insurance be one of them. After you choose a plan, be sure to do your research so that you know exactly what it covers &mdash; and what it doesn't.</p> <h2>6. Learn the Ins and Outs of Your Bank's ATM Fees</h2> <p>Commit to memory the occasions on which your bank will hit you with an ATM fee. Then be sure to avoid them. While a few dollars here and there might not seem like much, over time they can really add up. Just as there's no reason to throw money out the window, there's no reason to not educate yourself on your bank's ATM fee policies.</p> <h2>7. Devise a Strategy for Accessing Day-to-Day Funds Abroad</h2> <p>Despite fees, ATMs are still the best bet for accessing money abroad. If your travels are set to land you in a major international airport, you'll likely get the best rate by withdrawing cash in the local currency from an ATM upon arrival to your destination city. While it can be comforting to travel with some local currency already in your pocket, having that convenience will cost you. You'll have to fork over a commission fee to exchange money at a bank or ATM in the U.S.</p> <p>However, if you'll be flying into a smaller airport, there may not be any ATMs &mdash; or at least not any properly functioning ones &mdash; when you get there. In this case, it's best to travel with about $100 in the local currency so that you can pay for immediate expenses, such as food and transportation, without hassle. Once you journey outside the airport, you can find an ATM and withdraw more local money at a better rate.</p> <h2>8. Reapply for FAFSA</h2> <p>Students who qualify for federal financial aid before deferring college for a year must reapply the next year by filling out the Free Application for Federal Student Aid. So long as the finances of the student's family don't change in a major way, the student will likely receive the same financial aid package. Also, students who have secured a scholarship from their university can sometimes negotiate to have the aid held for them until their delayed matriculation. So if you have a university or college-funded scholarship, be sure to inquire about how you can go about receiving the award after your gap year.</p> <p><em>Did you &mdash; or will you &mdash; take a gap year? What'd you do? How did you prepare your finances before you left?</em></p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <p>&nbsp;</p> <p style="text-align: center;"><a href="//www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F8-money-moves-students-should-make-during-a-gap-year&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F8%20Money%20Moves%20Students%20Should%20Make%20During%20a%20Gap%20Year.jpg&amp;description=8%20Money%20Moves%20Students%20Should%20Make%20During%20a%20Gap%20Year" data-pin-do="buttonPin" data-pin-config="above" data-pin-color="red" data-pin-height="28"><img src="//assets.pinterest.com/images/pidgets/pinit_fg_en_rect_red_28.png" alt="" /></a> </p> <!-- Please call pinit.js only once per page --><!-- Please call pinit.js only once per page --><script type="text/javascript" async defer src="//assets.pinterest.com/js/pinit.js"></script></p> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/8%20Money%20Moves%20Students%20Should%20Make%20During%20a%20Gap%20Year.jpg" width="250" height="374" alt="" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/brittany-lyte">Brittany Lyte</a> of <a href="http://www.wisebread.com/8-money-moves-students-should-make-during-a-gap-year">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-money-moves-every-new-college-student-should-make">7 Money Moves Every New College Student Should Make</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/css-is-one-source-of-college-financial-aid-you-cant-afford-to-overlook">CSS Is One Source of College Financial Aid You Can&#039;t Afford to Overlook</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-things-financial-aid-might-not-cover">6 Things Financial Aid Might Not Cover</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-sobering-facts-about-student-loan-debt">5 Sobering Facts About Student Loan Debt</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-reasons-building-credit-in-college-helps-you-win-at-life">5 Reasons Building Credit in College Helps You Win at Life</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Education & Training Travel atm fees bank accounts college financial aid gap year scholarships self exploration students traveling abroad Tue, 21 Jun 2016 10:00:10 +0000 Brittany Lyte 1735468 at http://www.wisebread.com 7 Great Sources of Financial Aid for Switching Careers http://www.wisebread.com/7-great-sources-of-financial-aid-for-switching-careers <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/7-great-sources-of-financial-aid-for-switching-careers" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/coworkers_at_computer_000014305206.jpg" alt="Students participating in fellowships and grants for adult career training" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>With ever-growing competition in the job market, it's imperative to improve and develop our professional skill sets. Although higher education and career training can be an expensive investment, there are many sources of financial aid in the form of adult <a href="http://www.wisebread.com/how-to-score-extra-scholarship-money-for-college">career scholarships</a>, fellowships, and grants. Consider these seven.</p> <h2>1. Government Opportunities</h2> <p>Federal, state, and local governments often have money set aside to award grants and scholarships for adult learning. These opportunities are not very well advertised, but they are easily found if you know where to look. The best source of information on these is your State Education Bureau and the <a href="https://studentaid.ed.gov/">Federal Student Financial Aid Center</a>.</p> <h2>2. Scholarships for Women</h2> <p><a href="http://www.scholarshipsforwomen.net/">Scholarships for Women</a> is an excellent site that lists little-known financial aid opportunities for women. Many of them are expressly dedicated to specific demographics, including race, religion, family structure, field of study, sexual orientation, and education level.</p> <h2>3. Scholarships for Working Parents and Those Who Want to Work Abroad</h2> <p>If you are returning to college to finish a degree or start a new one as an adult student, <a href="https://www.scholarships.com/financial-aid/college-scholarships/scholarships-by-type/scholarships-for-adult-students/">Scholarships.com</a> has a number of links for adult learners. Some are specialized for working parents who are returning to the workforce after some time away. If you're adventurous and looking to have a second act abroad, the <a href="http://www.peacecorps.gov/50plus/">Peace Corps</a> has a special initiative to entice experienced professionals 50 years of age and older to join its ranks.</p> <h2>4. Vocational Training</h2> <p>There have been a number of recent news stories about the lack of well-trained tradespeople, since these jobs remain very much in demand. If trade school interests you, there's money available to help you make that career transition. Check out the link for trade school scholarships at <a href="http://www.collegescholarships.org/scholarships/vocational-school.htm">CollegeScholarships.org</a>.</p> <h2>5. Financial Aid for Senior Citizens<strong> </strong></h2> <p>You're never too old to learn, and many senior citizens are returning to school as a professional second act, or to pursue a long-held educational dream. Many schools (especially state schools) offer scholarships and grants specifically for senior citizens. Contact a college near you to learn about specific financial programs for seniors.</p> <h2>6. Career-Specific Opportunities</h2> <p>If you know exactly what field you want to study and need the funding to make it possible, <a href="https://www.scholarshipexperts.com/scholarships/by-major">ScholarshipExperts</a> gives you a way to search by topic of study. And the topics vary widely &mdash; from the liberal arts to science to business to trade school.</p> <h2>7. Culinary School</h2> <p>In recent years, our national palate has gotten more sophisticated thanks to the craft food and beverage movement, as well as the popularity of media properties like the Food Network. More people than ever are pursuing further culinary training, and happily, there are a number of educational funding opportunities available. The <a href="http://www.jamesbeard.org/education/scholarships-and-grants">James Beard Foundation</a> and cooking schools such as <a href="http://www.chefs.edu/tuition-and-financial-aid/scholarship-opportunities">Le Cordon Bleu</a> offer financial aid in the form of scholarships and grants.</p> <p><em>Are you considering returning to school or switching careers? How will you pay for it?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/christa-avampato">Christa Avampato</a> of <a href="http://www.wisebread.com/7-great-sources-of-financial-aid-for-switching-careers">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/what-to-do-when-you-cant-afford-your-childs-college-education">What to Do When You Can&#039;t Afford Your Child&#039;s College Education</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-money-moves-students-should-make-during-a-gap-year">8 Money Moves Students Should Make During a Gap Year</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-sobering-facts-about-student-loan-debt">5 Sobering Facts About Student Loan Debt</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-things-financial-aid-might-not-cover">6 Things Financial Aid Might Not Cover</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/should-you-save-for-college-using-a-529-prepaid-tuition-plan">Should You Save for College Using a 529 Prepaid Tuition Plan?</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Education & Training fellowships financial aid grants higher education scholarships Fri, 08 May 2015 13:00:08 +0000 Christa Avampato 1410186 at http://www.wisebread.com How To Get A Big Payoff From College Scholarships http://www.wisebread.com/how-to-win-small-scholarships-for-a-big-payoff <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/how-to-win-small-scholarships-for-a-big-payoff" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/graduation_2.jpg" alt="students at graduation ceremony" title="students at graduation ceremony" class="imagecache imagecache-250w" width="250" height="167" /></a> </div> </div> </div> <p>Winning a scholarship takes effort, even to snag an award that is relatively small ($500-$1,000) compared to the <a href="http://studentaid.unc.edu/studentaid/cost/ssa_ug_general.html">cost of attendance at a state university</a> (more than $16,000 per year). But, depending on your financial circumstances, you'll save on tuition now, and reduce the interest and principal on student loans later. And, if you can acquire multiple awards (which is easier once you land the first scholarship), you can rack up big savings. Even as an information junkie, I find sorting through the volume of information on scholarships overwhelming. So, I decided to get professional help. Here's what I learned.</p> <p>I spoke with <a href="http://www.scholarshipstreet.com/">Kimberly Stezala</a>, author of <a href="http://www.amazon.com/dp/0814409814/ref=nosim/?tag=wwwwisebreadc-20"><em>Scholarships 101:&nbsp;The Real-World Guide to Getting Cash for College</em></a>, and Betty Wagner, Director of Admissions at <a href="http://www.cmich.edu/Admissions.htm">Central Michigan University</a>&nbsp;(CMU). Kimberly educated me on private scholarships and Betty filled me in on university-specific awards.&nbsp; </p> <p>Both told me that doing these things could help win college scholarships:</p> <ul> <li><strong>Start early</strong> as more opportunities can mean more money. Kimberly recommends &ldquo;scholarship preparedness&rdquo; beginning with class registration for rising high school freshmen and exploring scholarship opportunities at least by the summer before your senior year of high school. Betty recommends visiting college campuses and narrowing your choices in the summer before your junior year based on factors such as admission criteria, cost, and programs of study.</li> <li><strong>Take advanced-level English classes</strong> to boost your high school transcript and equip you with the writing skills you&rsquo;ll need to create stellar essays. You should also take advanced-level courses in core subjects.</li> <li><strong>Log community service hours. </strong>Many scholarships require a certain number of service hours; and time serving the community can help you become a more experienced and compassionate person. <strong><br /> </strong></li> <li><strong>Go to summer camp.</strong> Many colleges and universities offer pre-college programs or specialty camps in areas such as music, art, theatre, media, and computers. Not only do these programs allow campers to explore interests and improve skills, they allow department heads to identify rising stars (and potential scholarship winners).</li> <li><strong>Get as much scholarship money as possible.</strong> More is (nearly always) better. The more money you can bring in from outside sources, the less you or your parents will have to pay. Scholarships can reduce financial aid packages but since this aid is often in the form of self-help or student loans, it is wise to offset your needs with free money as much as possible.</li> </ul> <p>If you&rsquo;ve narrowed&nbsp;your choices to 2-3 colleges early enough, you can start applying for scholarships offered by your short list of institutions in your senior year. CMU, for example, offers numerous scholarships, many based on your high school GPA and ACT score. Its Centralis program provides 20 awards covering the cost of tuition, room and board, and $500 for books and other expenses; students qualify based on high school GPA and then participate in an essay-writing competition on campus. Other awards of varying amounts designated for CMU students are also available. (See this <a href="http://www.cmich.edu/Admissions/Freshmen/Paying_for_Central/Scholarships.htm">scholarship listing</a> for more information.)</p> <p>Creating a short list of private scholarships (of which there are loads and loads) seems daunting. Kimberly offered excellent advice for managing this process though she indicated that it can, indeed, be time-consuming. She told me that the students who win scholarships tend to be entrepreneurial (they consider finding scholarship money similar to running a business), well organized, quick to respond, and persistent. </p> <p>Here are some tips on managing the business of applying for scholarships:</p> <ul> <li><strong>Start researching scholarship opportunities prior to your senior year of high school</strong> (many opportunities are open to high school students of all ages) using search engines such as <a href="http://www.fastweb.com/">FastWeb</a> and <a href="http://www.scholarships.com/">Scholarships.com</a>. Some local or state scholarships may not appear on these national listings so see if you can locate a city or state scholarship search engine (such as this listing for <a href="http://epic.cuir.uwm.edu/compass/about.php">Milwaukee</a>). You can also scour your paper or online archives for mentions of scholarships.</li> <li><strong>Begin prioritizing scholarships and organizing info relevant to each scholarship. </strong>Kimberly has an <a href="http://www.scholarshipstreet.com/scholarship_tools.htm">excellent tool on her website</a> that helps with this process.</li> <li><strong>Find out about your competition: specifically call scholarship providers and ask how many students apply and how many awards are given each year. </strong>I particularly liked this advice because I volunteer with a civic group that offers a scholarship but often has difficulty finding applicants that meet our narrow set of qualifications;&nbsp;if the applicant does qualify, s/he usually has a 50-100% chance of winning as there are usually 1-2 applicants.</li> <li><strong>Determine what you need to do to apply for the scholarship. </strong></li> <li><strong>Start compiling your information:</strong> ask responsible adults for letters of recommendation, sign up for community service, begin brainstorming ideas for your essay.</li> <li><strong>Follow the 1-2-3 process</strong> rather than blasting out all applications at one time. Send out 1, then 2, then 3 applications; though you probably won&rsquo;t have heard from the first scholarship committee and gotten feedback, you will have had some time to reflect on the process, rethink your essay, etc. and make adjustments.</li> <li><strong>Keep trying.</strong> After you have won your first scholarship, your credentials are validated and looked on more favorably by subsequent scholarship committees. (Some scholarships, though, may be reserved for those who have not yet won awards.)</li> </ul> <p>What influences scholarship judges?</p> <ul> <li><strong>Anticipated payoff.</strong> A scholarship is an investment of sorts in a student. Judges want to be wise stewards of scholarship dollars so they want to make sure that their investment in you will help you to succeed. So, they often make awards to those who are self-motivated and have a strong academic record.&nbsp;</li> <li><strong>High academic achievement, community service hours, and excellent communication skills.</strong> Scholarship committtees tend to value outstanding performance in the classroom, volunteer activities including leadership roles at school or in the community, and <strong><em>great writing skills</em></strong>. (Kimberly pointed out that most scholarship applications ask you to write an essay rather than solve a math problem. See the Art of Problem Solving website for a <a href="http://www.artofproblemsolving.com/Wiki/index.php/List_of_United_States_high_school_mathematics_competitions">listing of math competitions</a>, which may lead to cash awards or scholarships.)&nbsp;Being able to interact with adults (who are often scholarship judges) and articulate ideas&nbsp;in oral presentations&nbsp;are also valuable, especially for larger, more prominent awards. &nbsp;&nbsp;</li> <li><strong>Differentiation.</strong> Consider and relate how you are different from your peers, Kimberly advised. Though you may have a similar academic record as your best friend or group of friends, you may have a vastly different personal life and may have faced unique challenges. (For example, there are scholarships available to<a href="http://www.chfn.org/forpatients.html"> students with congenital heart disease</a> and children whose parents have had cancer.)</li> </ul> <p>A&nbsp;$500 award that may seem small now could double in value if used to offset student loans (based on 8% interest rate, capitalization of interest while earning your degree, and 10-year loan payback-<a href="http://www.collegeanswer.com/financing/lt_financial_planning/ltfp_accint.jsp">see this accrued interest calculator</a>).</p> <p>After you have begun college, you can pursue new scholarships, scholarship renewals, and scholarships pertaining to specific majors. But remember to make good grades so you can keep any scholarships that are dependent on maintaining a certain GPA.</p> <p><em>I&nbsp;won a $500 Parent Teacher Organization Scholarship in high school;&nbsp;the committee seemed to be impressed that I had participated in the Young Life Bike Challenge, a 2-week cycling and camping trip on the Blue Ridge Parkway.&nbsp; </em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/julie-rains">Julie Rains</a> of <a href="http://www.wisebread.com/how-to-win-small-scholarships-for-a-big-payoff">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-3"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/should-you-save-for-college-using-a-529-prepaid-tuition-plan">Should You Save for College Using a 529 Prepaid Tuition Plan?</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-questions-to-ask-before-taking-out-student-loans">6 Questions to Ask Before Taking Out Student Loans</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/not-rich-enough-and-not-poor-enough">Not Rich Enough and Not Poor Enough</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/europe-has-the-euro-are-you-ready-for-the-amero">Europe has the Euro. Are you ready for The Amero?</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-ways-to-make-long-term-care-more-affordable">5 Ways to Make Long-Term Care More Affordable</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance college scholarships money for college paying for college scholarships Scholarships 101 Wed, 26 Nov 2008 23:34:18 +0000 Julie Rains 2608 at http://www.wisebread.com Not Rich Enough and Not Poor Enough http://www.wisebread.com/not-rich-enough-and-not-poor-enough <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/not-rich-enough-and-not-poor-enough" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/cia.jpg" alt="" title="" class="imagecache imagecache-250w" width="250" height="333" /></a> </div> </div> </div> <p>Most of my highschool classmates came from middle class families that were not extremely rich. During senior year, I noticed a situation where families were not wealthy enough to reasonably pay for the costs of college, but not poor enough to receive significant financial aid. As a result, some of my classmates who got into prestigious colleges were forced to make a different choice. </p> <p>Personally, I was accepted to the University of California, Berkeley with a Regents Scholarship. After filling out a <a href="http://www.fafsa.ed.gov/">FAFSA</a> , I was determined to have no financial need so I received an honorarium of $500 per semester. On the other hand one of my classmates was determined to have a financial need because his father lost his job. The scholarship covered his tuition and even rent for him and his parents since they lived together. I thought that was great for him because he needed the support, but at the back of my mind I thought it was a bit unfair because I received the exact same scholarship, but my financial reward was about 1/20th of what he received. </p> <p>My situation was not that dire because my parents could readily afford the fairly low in state tuition of Berkeley at that time. However, a couple of my other classmates chose their second choice schools because their parents were not rich enough and not poor enough to afford their first choices. One girl I knew was accepted into Harvard, but ended up choosing UC Santa Cruz because her parents could not reasonable afford the costs of Harvard, and yet at the same time the forms said that they do not qualify for financial aid because her parents could technically afford Harvard by spending every penny of their income. Another girl chose Berkeley over MIT for the same reason even though she really wanted to go to MIT. Basically, those who can afford college easily had no problems, and those who could not pay also had no worries. It is only those families that could barely afford the fees and tuition of colleges that had to make their children make a difficult decision.</p> <p>At that time, I thought that the situation was extremely unfair because these classmates of mine were very bright and earned their spots at their top choice of schools. The only reason they had to give up their positions was that their parents were hardworking middle class Americans. Since all of the financial aid documents are so tied to our parents&#39; income and assets there was not much a 17 or 18 year old could do about it. Lately, some colleges like Stanford, Harvard, Princeton, and Yale have extended their aid to middle class families because they finally realized that they are losing great students in families who are barely able to afford these schools. Regardless of these reforms, I think every year thousands of middle class students are still forced to forgo their first choice schools because of the way financial needs are determined.</p> <p>However, looking back now I think that my classmates made the right choice by not choosing an expensive undergraduate education that their families could not finance. Since they are exceptional individuals they are still exceptional regardless of which college they went to (their second choice schools are great anyway). The girl that gave up MIT during her undergraduate years is now at MIT anyway in a PhD program which is financed by fellowships. Her family also does not have any debts because she chose a school that was much more affordable during her undergraduate years. Now I understand her maturity and wisdom in forgoing her first choice. </p> <p>If you are a teen who had to give up your top choice school because your family is in the middle class and could not get financial aid, then I understand your angst. All I have to say is that as long as you excel in whichever college you choose, you can still be successful and perhaps end up in your first choice school again. </p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/xin-lu">Xin Lu</a> of <a href="http://www.wisebread.com/not-rich-enough-and-not-poor-enough">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-4"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/its-the-21st-century-why-is-your-money-stuck-in-the-20th">It&#039;s the 21st Century — Why Is Your Money Stuck in the 20th?</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-and-why-to-start-an-investment-club">How (and Why) to Start an Investment Club</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/should-you-save-for-college-using-a-529-prepaid-tuition-plan">Should You Save for College Using a 529 Prepaid Tuition Plan?</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-ways-millennials-have-changed-money-so-far">6 Ways Millennials Have Changed Money (So Far)</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/3-ways-your-body-sabotages-your-money">3 Ways Your Body Sabotages Your Money</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance Lifestyle education scholarships school Sat, 19 Jul 2008 19:48:19 +0000 Xin Lu 2252 at http://www.wisebread.com