Be a “Student Loan Hero”

Repay Student DebtEhlers-guest bloggerBeing a ‘Student Loan Hero’ is a hot topic in the mainstream news. It’s also a hot topic around my family’s kitchen table these days, because 2015 was our son’s first repayment year on a private college loan and in 2016 our daughter finalizes her college finance decisions.

To sort the choices we looked at CFPB (Consumer Financial Protection Bureau) tools to understand student loans (federal or private) available and repayment options.

A new ‘income-driven’ repayment option for student debt is getting attention.  It’s called REPAYE (Revised Pay As You Earn), and it is based on a certain percentage of your income. The loan repayment details under all the income-based repayment plans were best described by Federal Student Aid (U.S. Department of Education).

Much has changed in the world of college finance during the five years between our son’s and daughter’s college entrance. Federal loans issued before July 1, 2010 were made through the Federal Family Education Loan (FFEL) program. If you’re unsure and need details about your personal federal loan you can find your information on the National Student Loan Data System database.

Whether you are a new college graduate or a soon-to-be college freshman, be a ‘Student Loan Hero’ by thoroughly researching all your borrowing and repayment options.

Carol Ehlers is a Family Finance specialist working to empower consumers to take control over their economic lives. 

 

Barb Wollan

Barb Wollan

Barb Wollan's goal as a Family Finance program specialist with Iowa State University Extension and Outreach is to help people use their money according to THEIR priorities. She provides information and tools, and then encourages folks to focus on what they control: their own decisions about what to do with the money they have.

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Comparing College Financial Aid Offers: Online tool sorts college options

Carol Ehlers

Today’s guest blogger is Carol Ehlers, an ISU Extension Family Finance specialist helping Northwest Iowans make the most of their money.

My college bound daughter began getting financial aid offers these past few weeks. Rather than crunching numbers from financial aid offers, we’re using a tool from the Consumer Financial Protection Bureau to help us make sense of it all.  It’s called  “Compare Financial Aid.

The tool allows students to compare costs from three schools at a time. By entering only the names of the universities, we could see the estimated price of each college, the graduation rate, the loan default rate and median borrowing. Based on your individual situation you can calculate the estimated debt burden and the estimated monthly student loan payments students might face after graduating.

The tool gets more interesting after we click the “enter financial aid” button. When we enter data from the schools’ financial award letters — including expected family contributions and military benefits, if applicable — the calculator provides students and parents with a more realistic view of our college options, financially speaking.

We took the tool on a test drive. By entering the names of three schools — we chose a public university in-state, a private college and a public university out-of-state — we found that the sticker prices of the three schools ranged from $18,600 to $37,000 for the first year.  By entering personal financial aid and scholarship information, we could build a personalized financial projection, which includes projected ‘Debt at Graduation’ and ‘Monthly Payments’ on college debt.  These  costs can be viewed next to graduation and retention rates.

For my family, as for all families with a college-bound student, balancing a realistic look at costs alongside a school’s track record of success is very helpful in making an informed choice about a college investment.compare financial aid-2

 

 

 

Barb Wollan

Barb Wollan

Barb Wollan's goal as a Family Finance program specialist with Iowa State University Extension and Outreach is to help people use their money according to THEIR priorities. She provides information and tools, and then encourages folks to focus on what they control: their own decisions about what to do with the money they have.

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Renter’s Insurance for College Students?

Like some of you, I’m sending my children off to college this week.  It’s amazing all the “stuff” they take — so much more quantity and more value than when I went to college.  What would happen if your child’s possessions were destroyed in a fire or tornado?  Would your insurance cover the cost of replacing all the electronics, furniture, books, and other supplies?

Whether your student is living in a residence hall or an apartment, be sure to talk with your insurance agent about this.  Ask what coverage you have for property that is “off premises” (in other words, located somewhere outside your home).  That will help you decide if your child needs to have his/her own renter’s insurance to cover their stuff in case of theft or other disaster.

If you decide you should have extra coverage for your child’s possessions while they’re away at school, use this opportunity to teach your child about renter’s insurance.  Take her/him with you to talk with the agent and pay for it.  Even though it is inexpensive, renter’s insurance is often neglected by young adults, and if your child learns its importance while in college, then he/she will be more likely to get coverage after college, as well. ~Barb

Barb Wollan

Barb Wollan

Barb Wollan's goal as a Family Finance program specialist with Iowa State University Extension and Outreach is to help people use their money according to THEIR priorities. She provides information and tools, and then encourages folks to focus on what they control: their own decisions about what to do with the money they have.

More Posts

    

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