Help! My parents aren't helping me pay for college. How can I minimize my debt?

04 June, 2018

It’s never too early to start thinking about your financial plan for next year. I know days at the pool, summer vacations, and spending time with your friends seems waaay more fun but trust us, you’ll be glad you have a plan -especially if you’re flying solo when it comes to paying for college. More often than not, students and families who don’t create a financial plan for college are more likely to over borrow –putting themselves at risk for having a high debt burden upon graduation. If you are responsible for funding your own college education, it may seem that loans are the only option but we’re here to debunk that myth! Follow these tips to help minimize your debt :

Create a budget
All great financial plans start with a budget. If you do plan to borrow, this will help keep your borrowing to a minimum. If you already know your housing plans for this coming year, sit down and take a look at how much you will need per month – including rent, utilities, food, books, etc. Don’t forget to factor in the income you’re projecting to take home from your part time job. Are you planning to use your financial aid refund to help cover these costs? Use our Expenses Estimator tool to forecast your Ubill for next year and see what financial aid will cover.

Spend wisely
If your parents are leaving the college experience completely up to you, be sure you’re making wise spending choices. Don’t sign up for an off campus apartment that is $600/month and don’t get a meal plan if you don’t need it. Try and find affordable housing, and grocery shop for your meals. Yes, it’s okay to live off mac and cheese, frozen pizza & ramen if you have to! It may be tempting to use your financial aid refund and buy unnecessary things, but remember that money is intended to help pay your tuition, fees and living expenses only.

Accept your loans on a semesterly basis
Unless you know for sure you need the entire amount for Fall & Spring, you can hold off accepting the loans through your A+ account. If you decide you need the loan later on, we can always add it for you, or charge back the loan if you took out too much. Feel free to call our number at any time if you need help with this -->515-294-0677

Work full time in the summer
If you’re not taking classes this summer, chances are you have plenty of free time (refer to aforementioned “pool” time :) but we challenge you to work full time over the summer to help pay for your living expenses during the school year. If you find your financial aid refund and part time job income won’t be enough to cover your monthly expenses, this is a great alternative. If you’re living at home with your parents rent free this summer, try and save as much of your paycheck as you can so you can use that money to pay your rent. Saving money is key to any college financial plan!

Apply for scholarships
If you’re paying for your college education by yourself, the free money (AKA: scholarships and grants) is the number one way you can reduce your loan indebtedness. Always file your FAFSA every year by December 1st to be considered for priority aid (the automatic awards based on your need like the ISU grant) and fill out the FinAid Scholarship application through OneApp. Your college or department will also have their own separate application for their scholarships. The deadlines can vary, so look here to get an idea on timelines but generally, winter break is an excellent time to sit down and complete the applications. Don’t forget about the outside sources as well, like Fast Web and TFS.

Do you still need help creating your financial plan for next year? Schedule a one-on-one appointment with us! Email loaneducation@iastate.edu or give us a call @ 515-294-0677.

6 Student Loan Tips for Recent College Grads

21 May, 2018

Congrats, Class of 2018! Graduating from college can be exciting, but life after college can be frightening and stressful. You are faced with major decisions such as launching a job search, deciding to begin a career, relocating, or continuing your education. Basically, adulting is hard. When you get your first student loan bill in the mail, don’t panic! This is the part of adulthood we want to make easier for you. Here are some tips that may help you, or someone you know who is about to go through the loan repayment process.

1. Don’t ignore your student loans!
Unfortunately ignoring your student loans won’t make them go away. (We don’t make the rules, we just enforce them.) Student loan default is actually a bad move when it comes down to the consequences of missing student loan payments. You can be sent to a collection agency, and the government can garnish your wages and/or tax refunds. If you cannot afford your payment, contact us for help. No matter your financial situation, your servicer can help you find a more affordable payment option.

2. Set a budget
Even though your payments aren’t due until 6 months after you graduate, start including your student loan payment into your budget NOW. That means planning your after graduation budget around your fixed bills, like rent, utility bills, and your projected student loan payment. If you haven’t done so already, complete exit counseling to work on a post-graduation budget that includes your estimated student loan payment. 

3. Research forgiveness options
A very high percentage of borrowers do not take advantage of the various loan forgiveness options available. If you qualify, you may want to re-consider the payment plan you have elected. These plans are very finicky because you have to have the right type of loan, and be on the right payment plan for it to be effective. 

4. Sign up for automatic payments
I think we can all agree that paying student loans is no fun, but auto pay can make it easier. With auto pay, you don’t have to remember to log in and make your payment every single month! It ensures your payment is always in full and on time –just elect the bank account you want to make payments from. This can all be done via your servicer's website online. As an added bonus, you will also receive 0.25% off the interest when you sign up for auto-pay.

5. Make extra payments
If you can, pay more than the minimum. Even paying as little as $50 a month more can shave years off your repayment term. This is a great concept that applies to any debt management strategy. Want to pay your loan off earlier? Pay more than the minimum! Want to save yourself tons of interest? Pay more than the minimum! Want to get more out of life? Pay more than the minimum! 

6. Don’t postpone payments unless you really need to
During your exit counseling, you probably learned about deferment and forbearance. This can be a helpful solution if you’re experiencing a temporary hardship, but can be costly if used as a long-term solution. In most cases, interest will continue to accrue on your loan while you’re not making payments and it will also capitalize (when interests accrues on interest = baaaaad). And when you go back into repayment, your loan balance will be even higher than it was before. If you need to seek forbearance for financial hardship, be sure to contact your servicer about going into an income based repayment instead.

How to save big on summer travel

07 May, 2018

With spring classes officially in the books, summer break is finally upon us – except for anyone taking summer courses starting next week. (Whomp whomp… but kudos to you for being ambitious and continuing that grind. You go Glen Coco!) Nothing says summer more than planning a relaxing trip or vacation. Whether it’s with family or a few college buddies, start mapping out your warm weather vacation strategy ASAP to save some money. Here are our tips :

When to book a bargain
A general rule of thumb is to purchase plane tickets at least six weeks in advance. That goes for domestic travel around the US, but worldly travelers should be looking as early as six months out. It has been rumored that Tuesdays and Sundays can be the best days of the week to get the lowest fare on plane tickets. Are you traveling during a holiday? Use this site to help plan your holiday travel and utilize the help of Hopper, an app that analyzes flight prices to predict when ticket costs will hit rock bottom. 

Fly the (budget) friendly skies
There are some great sites out there that can help you find low fares, and while the list can seem endless – Kayak and Google Flights are among the most well known services for bargain hunters. Scott’s cheap flights is a site that delivers great results for international travelers. Their team of humans (not computers) search for cheap flights all day every day, and when an airline makes mistakes or offers a great sale, they will email you with instructions on how to book. Sign up for their newsletter to be in the loop of the rarest of rare travel finds. This is a great way to find travel inspiration, too!

Land supercheap lodging
Everyone knows the lodging part of a vacation can turn out to be the most expensive. Turn to booking.com to find the absolute cheapest hotel rates. Of course, sites like Airbnb and VRBO are becoming popular because the rates are usually cheaper, AND you’re offered more amenities/room space which = more bang for your buck. Consider contacting the host directly to kindly inquire if there’s room to negotiate on price. You’d be surprised how often there is, especially during off-season times of the year.

App, app and away!
In addition to plane tickets and lodging, we know there are little travel expenses that tend to add up along the way. Baggage rates, rental cars, Uber/Lyft, food, the list goes on! To make the most of your vacation dollar, use these handy budgeting appsTrabee Pocket helps you set a vacation budget in advance so you can plan easier, and even offers a function to use multiple currencies and set exchange rates. When you're all done, you can view and export your travel expense report. (Calling all budget nerds!)

Be a savvy spender
Let's be real. Traveling is fun but it can get expensive if you don't play your cards right. In addition to using these tips, make sure you are not relying on a loan or credit card to fund your vacations. Credit cards should be a no go unless 1) You are taking advantage of the reward/airline points and 2) You have the cash on hand to pay off the credit card purchases in full. The only thing you should be paying for after your trip is a bad sun burn, not the interest on your credit card!

It's Dead Week. How to Financial De-Stress

23 April, 2018

Your projects are nearing their deadlines, you have two more papers to write, a group presentation AND a Biology final that’s 30% of your final grade. Eek! Were they really thinking when they named this week “dead” week? For most students this week feels anything but dead. (Only because a steady supply of coffee and Red Bull is keeping you alive and functioning). If you’re feeling an increased amount of stress this time of the semester, you’re not the only one. In addition to study woes, you might be worrying about paying another months worth of rent, or if you’ll have enough money to move for your first full time job. We don’t want to add financial stress to the mix, so take these precautionary tips to help financial de-stress your life!

Create a Budget – At first, you might think that budgeting your money is only going to add to your financial stress, but it is actually the opposite. Budgeting is the best tool you can use to get control over your spending and make sure you’re not shorted at the end of the month. Start thinking about what expenses you will need to have covered by next month, and take the steps today to implement some saving strategies into your budget. Instead of going out every weekend, or spending your paycheck on a new summer wardrobe, set aside some money for your upcoming summer events.

Get an Emergency Fund – If you set aside some money for an emergency fund, that will create peace of mind for you and will alleviate any feelings of stress if something unexpected happens. We all know flat tires and last minute medical bills pop up out of nowhere and are never at the right time. With having the emergency fund, you will be prepared to cover that bill instead of relying on credit cards or parent’s help – no sweat! Shoot to have at least $500 - $1,000 saved up in your emergency fund to start with. Investigate an option with your bank to have a portion of your paycheck automatically deposit to your savings account. It's easy and stress free!

Make an Appointment with us! If you are struggling with creating a budget or developing a savings plan on your own, we can help make the process stress-free. We can walk you through step by step to help you get a handle on your spending, in addition to providing other resources, such as taking a personal finance class here at Iowa State. (HDFS 183 or 283) If you are feeling overwhelmed by your student loan debt, we will make it easy to understand your loans and your repayment options. Contact us via email or phone below!

Check your Credit Report Regularly Identity theft is no joke. This financial stressor can be prevented by regularly checking your own credit report, and monitoring your statements. If you see erroneous activity on your credit card statement, be sure to dispute the charge with your credit card company. If you see an account on your report that is not yours, contact the bureau and the creditor to get it removed. Also – do not fall victim to the many student loan scammers that are out there. They prey on student loan borrowers by promising loan forgiveness and lower payments. If it sounds too good to be true, just hang up the phone!

Strive for Balance Finally, it is importance to find the balance between work, school, saving and enjoying your life. Take time to relax regularly and know that you cannot conquer all of your financial troubles in one day. It takes time to get the hang of budgeting and choosing to save your money over spending it. One month you might be a savvy spender, but the next you decide to ‘treat yo self.’ It’s all about balance!

If you’d like to make an appointment so you can financial de-stress, email us at loaneducation@iastate.edu or call 515-294-0677.

How do I build credit as a student?

03 April, 2018

Building good credit is a must. We know why credit is important because it helps you qualify for loans, auto insurance, apartment leases, and other credit down the road. But as a student, you typically don't have a mortgage, or a lengthily credit history, so how can you be proactive about building your credit now? Consider these tips :

1. Become an authorized user on your parents’ account.
If your parents already have an existing credit card account, they can add you on as an "authorized user." This is a good option to ease into credit building, as long as your parents are responsible credit card holders and are okay with you “piggybacking.” You can make purchases as an authorized user as if the card was your own, but paying the charges legally remains the primary cardholder’s responsibility. Your parents or family member will still be able to monitor what you spend, but this can be a way for students to get experience using a credit card without trying to apply for one on their own.

2. Open up your own credit card and use it for occasional, small purchases.
Since responsible and on time payments help build your credit history, having the card alone won’t build your credit, you have to actually use it. Sounds scary right? But the key point is to only use the card for purchases you can afford –like a tank of gas, or a trip to the grocery store. After you use the card to complete your purchase, pay it off immediately. When you apply for the card, make sure you are not agreeing to open an account with hidden annual fees, or sky-high interest rates. If you are unable to get a credit card on your own, you may need to assign a co-signer. 

3. Open up a secured credit card.
This is another safe way for students to build credit. Secured credit cards require a “down payment” or security deposit that becomes your credit line. For example, you can get a secured credit card with a credit limit of $200 if you put down up to that amount from your checking or savings account. This is a great concept because it prevents you from spending money that you don’t have. We recommend reaching out to your personal bank or credit union if you're interested in opening a secured credit card account. 

4. Practice good credit habits.
Once you get your first line of credit –whether it is a credit card or student loan, you will need to make sure you manage that wisely. Paying off your balance on time and in full is the best way to show lenders that you are responsible with your debt payments. Payment timeliness is a big factor in how they calculate your score, in fact, it makes up about 35% of your score. Also, be cautious of opening too many accounts at one time. This might look like risky behavior to the lender because you have a short credit history and don’t want to appear credit reliant. When it comes to your student loan payments, never miss a payment (even if it's a day late!). Be sure to utilize the auto pay option to save 0.25% off the interest on your loans and in return, gain piece of mind that your student loan payment will always be on time.   

5 Ways to Start the Semester Off on the Right Foot

09 January, 2018

Welcome back, students! We hope you have all enjoyed an exciting, yet restful break. With the first week of classes already underway, here are our tips to starting off this semester on the right foot!

1. Read the Syllabus
Take full advantage of “Syllabus Week” and actually take time to read it! This one may seem like a no-brainer but reading the syllabus can help you understand how your professor grades the classes, and what you can expect to get out of the course. It can also help you plan for the semester ahead by being aware of important test dates, assignments and quizzes. Take the initiative to introduce yourself to the professor as well during this week. This will show them that you care about their class and have an interest in what they are teaching. This will come in handy later in the semester, if you find yourself needing help or extra guidance.

2. Stay Healthy
If you’ve noticed the temperature has gone down, chances are you’ve also noticed the amount of people coughing and sniffling around campus has gone up! We are in high tide cold & flu season so do you best to ward off potential sicknesses by washing your hands often, eating healthy foods, and getting lots of sleep. Maybe it's time you finally visited the salad bar at the dining centers. French fries do not count as vegetables!

3. Stay Organized
If you haven’t already invested in a planner… go buy one! They are an excellent tool to ensure you stay on top of everything you have going on in your life –group meetings, deadlines, assignments, tests, work schedules, and of course, fun social events. :) As soon as you get your course syllabus, jot down the dates into your planner, or use the weekly planner to plan your homework schedule for the week. No matter the way you are using your planner, at least you will be less likely to forget an important date!

4. Practice Time Management
Along with keeping a planner to stay organized, try to set up your schedule so that you have multiple breaks throughout the day, and then use those breaks for studying. Have a slow lull at work? Put in some extra studying time! Start preparing for your exams from day one so you aren’t cramming for them later. You’ll retain all the information easier by reviewing the content on a daily basis. 

5. Track Your Spending
You thought this blog wasn’t going to bring up finances… well think again! :)With this being the first month of the year, everyone is on a mission to better themselves not only physically, but financially. You don’t have to aspire to be a personal finance whiz by the end of the spring semester, but you can start small by tracking your spending. Our website has a whole section on budgeting and some tools you might find helpful. Your wallet will thank you later!

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