College

student loansIt may not be your first priority, but preparing to repay your student loans should be on your pre-graduation to-do list. How you manage your student loan payments will shape your finances for decades to come, so know what you’re dealing with before you get swept up in the day-to-day demands of post-graduate life.

Before you leave school, also make sure you know the answers to the following questions. Good news: We’re giving you them (or at least telling how to find them on your own).

1. What Kind of Loans Do I Have?

You either have private student loans or federal loans. You can look up your federal loans using the National Student Loan Data System (NLDS). You should have the paperwork from your lender or student loan servicer (private and federal) from when you took out the loan. Private loans generally come from traditional banking institutions, while federal loans are issued by the government. Common federal loans include Direct subsidized loans, Direct unsubsidized loans and Perkins loans.

2. Whom Do I Owe?

You can find this information in the resources referenced above. Your financial aid office should have information on file as well, since they receive the money. If you haven’t gone through student loan exit counseling at school, you need to before you graduate. They’ll explain whom to pay, and it’s the perfect time to ask any questions. Once you know who’s managing your loans, set up an online account to access all your information.

3. What Are My Repayment Options?

This depends on the type of loans you have. Private student loan repayment tends to follow a typical installment loan repayment structure, in which you make monthly payments for a fixed loan term. Federal student loans offer more options. The default play is called standard repayment: fixed monthly payments for 10 years. If you want a lower monthly payment when you start out, you can change your repayment plan at any time for free, though the change may not take effect immediately. If you want to enroll in an income-driven repayment plan, graduated repayment or extended repayment, be sure to request a new plan through your student loan servicer as soon as you can. You can learn more about student loan repayment options here. ...continue reading

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good money traitsIt is crucial that your child has an idea of personal finance at a young age. You want them to grow up knowing how to pay their bills and understanding what it means to be in debt. Here are five ways you can teach your child about personal finance that can also be fun and memorable.

1. Take Them Grocery Shopping

Encourage your teen to participate in a “grocery day” with you to better understand financial literacy. Sit down with your child before shopping and go over your budget and your list. Explain to them how much you are looking to spend and the food you need for the week/month.

Have them help you coupon clip and try and make a goal to save a specific dollar amount. Take them with you to the store and have them help you look for each product. Make sure you stay within budget; you might want to consider bringing only cash with you so you don’t go over.

You can turn this into a fun adventure! This can make grocery shopping fun for the both of you.

2. Invite Them to Help You Organize Your Receipts

 After your holiday shopping, you might be stuck with a lot of receipts and bills. Invite your child to help you organize your receipts to understand how much expenses cost. Your child may be surprised to learn how expensive things can be. This might teach them to think twice before asking for luxury items next year.

Your child also may be interested in holding a job so they can pay for more discretionary expenses on their own. You could even teach them a little about tax on products when going through your receipts. ...continue reading

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college educationThere are many ways to fund a college education. Loans, scholarships, working between classes and saving during high school are some of the ways students can afford college.

There's also another reliable way to pay for it — hit up your parents.

The average cost for an in-state public college for the 2015-16 academic year averaged $24,061, and was $47,831 at private colleges, according to a survey by College Data.

Graduates may eventually cover those expenses with future earnings, but that's years after leaving college and doesn't help at all before starting school.

For parents who are generous enough to pay for some or all of their children's college education, it can require some sacrifices. And I'm not just talking about taking out a loan, dipping into a retirement account or taking out some equity in your home.

Cutting vices

Some families have to make life changes to be able to afford college. These can go well beyond stopping smoking or not going out for coffee every weekday. Getting rid of your vices makes sense for more than monetary reasons, but some pleasures in life are worth keeping, even if your kid has to get a college loan or two.

Liberty Bank of Chicago recently put together a graphic (at the bottom of this post) that lists simple vices that can be cut to help struggling families save for college. The bank based the total savings amount for each item on putting the money in a savings account for 18 years that earned 3 percent interest.

It's interesting to see how much can be saved by not doing something for 18 years — all of your child's life.  ...continue reading