SAT Tricks

The SAT is challenging enough without some of the well-documented traps that were more prevalent in the past.  However, as with many multiple choice tests, there are things to be aware of that can help you from making some silly mistakes.

Jon Siegelman has a good post on a few of these which is worth reading and considering.  Here’s one takeaway.  At the beginning of each section on the SAT are the easy questions, the hard questions come at the end.  Let’s say you see a question like this:

Q:  Joanne drives to work at an average speed of 20 miles per hour, and returns home along the same route at 50 miles per hour…

Mr. Siegelman says  “If it’s anywhere near the end of the section, don’t answer 30 miles per hour.”

What he is saying is that your brain will give more weight to “30” as the correct answer because you have been conditioned that way, “Hm, 30 is the average between 20 and 40, that must be it!”  But since it is at the end of the section, it is a hard question and 30 is the “easy” answer.  Avoid it. 

We suggest that you don’t look at the possible answer choices until you have calculated your own answer so you don’t get accidentally “attracted” to one of the choices.  Let one of the answer choices validate what you came up with on your own.

That’s not to say obvious answers are not ever correct; in fact, Mr. Siegelman notes they are routinely correct earlier in the sections.  Not every question is a trick, but when you are dealing with the hard questions, don’t jump to conclusions.

Save Money on Your Textbooks

If you don’t have your textbooks for this upcoming semester, you still have time to get them and save money too. Here is the short version of how to do just that:

First, get the ISBNs of the books you need. How do you do that? You should have that information from registration, but if you don’t, call the student bookstore at your school and ask them what the books are for your classes, ask the ISBNs and how much the bookstore charges. (The author and title are not always enough information to be sure you get the correct editions.)

Second, go to Amazon Textbooks and then Chegg.com and search by ISBN. [Bigwords.com can also be a good resource.]

If you want to use Amazon, sign up for Amazon Student using your college email and you can get free two-day shipping for six months. You won’t believe how convenient that will be, not just for these books but for any of the items Amazon sells.

Third, with the pricing information, decide whether you want to

1. Buy new from the bookstore (bad idea)

2. Buy new or used from Amazon (much better) and then trade them in at the end of the semester (fantastic idea)

 3. Rent from Chegg (compare their price to Amazon’s used purchase and then trade-in price)

Fourth, order them and have them shipped to your home now so you get to school and get too busy to be buying books.

Fifth, tell your parents how much money you saved. They’ll appreciate your can do attitude.

Congratulations! If you would like a free worksheet we’ve put together to organize this for you, drop us a note.

Insurance and College Students

Many parents associate their kids going to college with things like buying sheets and finding boxes and whether or not they need a small refrigerator.  Those are important for sure, but there is something else to put on your checklist, and that is insurance.  How will your teenager going to college affect your different insurance coverages?

First, let’s look at possessions or personal property.  Will your homeowners policy cover your student’s possessions at school if there is a loss, like a theft or a fire?  Does it matter if they live in on-campus housing or not?  Is there a limit on the amount of coverage for your son or daughter?  Most policies do cover a college student’s possessions but the only sure way is to check with your insurer.  If you are not covered, you want to find out about a renters insurance policy which will then provide coverage.

Next, car insurance.  If your son or daughter is on your automobile insurance now, moving to college can save you money.  Many insurers will reduce premiums if your previously driving teen does not have access to one of your vehicles because they are so far from home.  The details on these situations vary widely-some companies have certain distance limits for example, so you’ll want to find out what the specifics are in your case.  Also, if your student is taking a car with them, you’ll want to let the insurance company know that too.  The coverage may need to be adjusted for the new state’s requirements.

One study showed that half of all parents failed to make adjustments to their auto policies when their kids went to college.  The lost savings can add up to $3,000 over four years.

Finally, let’s look at health insurance.  You do want your son or daughter to be covered with health insurance while at school.  Start with the existing policy and be sure that it will “go with” your teenager to their new home.  Check specifically for in-network vs. out-of-network care.   If you need to find new coverage, many colleges offer student health plans that are seemingly affordable, but you want to look at the coverage details closely.  Are there low caps on claims? What items are excluded?  It might help to have a conversation with the staff at the college’s medical facility to find out what other students do and what works well in that geographic area.  One choice where there is no other coverage is to buy a high-deductible policy for your teenager.  You’ll end up paying for most care that is needed since the deductible is high, but the policy will provide coverage for very expensive care, should that be necessary.

The common theme with insurance matters is to get on the phone to your agent or insurance company and talk over your situation with them.  Know what coverage you have and what changes you might need to make, and in the event of a claim, you’ll be glad you did.

New Whitepaper on Tuition Payment Plans

With high school barely in the rear view mirror, it is time for parents to start thinking about the upcoming college bills.  We have just released a new study on tuition payment plans at Virginia’s public colleges, available here.  The payment plans should be part of every family’s college funding strategy.  However, there are a number of twists and turns that you’ll want to know about, so we urge you to read the whitepaper before you enroll.  If your son or daughter will be going to a private school or out-of-state school, the tips will still apply–tuition payment plans do not differ that much by college.

Please let us know if you have any questions about payment plans.

HS Graduates-Tips for Summer

Graduating seniors: Last October when you were mired in essays and applications, you probably thought graduation would never get here. Well it’s here! Congratulations and well done – you deserve a pat on the back for both your perseverance and your accomplishment.

This summer is a great time to get a few things straight before heading off to college. The biggest one that many students neglect until the last minute is figuring out your spending money in college. If you have your money lined up for the year already or are counting on a job this summer for it, you’re all set. But if you think you’ll need some from your parents, you’ll want to address this now. Don’t wait for when you are packing up the car!

Start by dividing your expected expenses into one-time expenses and monthly recurring ones. For example, things for your dorm room, a few new clothes, your textbooks – these are one-time expenses. Keep these separate from the recurring ones, things like money for going out, concerts, movies, and having fun. Colleges are great sources of free activities but many things cost money. If you’ll have a car, add in gas and parking costs. If you plan on joining a fraternity or sorority, add in any costs for that.  Greek life can be a surprising expense.

Once you have your estimate, ask your parents to sit down and go over it with you. If you’ve done a good job, they will be more likely to listen to what you have to say. They might not hand you cash, but it will start the conversation going, and you’ll be beginning your journey toward financial independence!

You also want to spend some time on the mechanics – what bank will you use? Will you have access to that bank’s ATM at college? How will your parents get you money if they need to? What if there is an emergency need for money? Spending some time on these questions now will save you lots of headaches in September.

For more on the ins and outs of your spending money, drop us an email and we’ll send you more tips.

Two more summertime ideas:

• If you have a student loan in your financial aid package, you must do online “entrance counseling” before you can get the money. Do that this week. It will only take 20 or so minutes and it’s required. Your school’s financial aid office will give you the details of how to do the counseling.
• When you register for classes (most likely at orientation), write down the ISBN of the textbooks your classes will be using. You can then use it to find cheap alternatives to paying retail price at the student bookstore for introductory level books you’ll only use once. This can save you hundreds of dollars and there’s really no excuse not to do it. Let your parents know you want to do it too, they will appreciate it.

Your newfound freedom brings with it newfound responsibilities, especially financial ones. Use the time you have this summer to make a plan and you won’t be living like Sugarland sings:

“Dear Mom and Dad,

Please send money, I’m so broke that it ain’t funny.

I don’t need much, just enough to get me through.”

Summer Jobs and Taxes

If you are lucky enough to have a part-time job this summer, you’ll most likely be asked to complete a W-4 form so your employer can determine how much income tax to withhold from your paycheck.  The form is easy, it’s the worksheets that go with it that are complicated.

Here’s a tip: for 2019, the standard deduction has increased to $12,200. If you do not expect to make that much income in 2019, go to Line 7 on the W-4 and write the word EXEMPT.  Your employer will not withhold any income taxes which is appropriate because you will not owe any income taxes.  Your share of payroll taxes will still be withheld, and those are not refundable.

If you do expect you will have more than $12,200 in income from all sources in 2019, you will want to complete the worksheets on the W-4 to determine the correct amount of withholding.

Please do not consider this to be tax advice, it is for informational purposes only. For tax advice, consult a professional tax advisor.

One final tip:  if you can manage it, you can open a Roth IRA to deposit some of your tax-free earnings.  The benefit is that those contributions will grow without being taxed if you wait until age 59 1/2 to make withdrawals.  It’s the best deal going!

That covers income taxes, but what about the FAFSA? Students are allowed to earn a certain amount without any impact to the family’s EFC. The amount for 2019 income is $6,660. Student income above that amount is assessed at 50% in the EFC formula. (However, remember that your 2019 income will not be used until the 2019-20 version of the FAFSA, which determines aid for the 2020-21 school year.)

HRA Student Budget Worksheet

HRA Students, find the link to the budget worksheet to use with your parents here.

The $3,600 solution for student loans

The hot topic of the current season is whether or not Congress should extend the subsidized (lower) interest rate on need-based Stafford loans to college students beyond the July 1 expiration date.  The subsidized rate is currently 3.4%.  After July 1, all loans will be at 6.8%, which is what the unsubsidized loan rate is at present.

But this argument totally  misses the point about student financial aid.  First, loans are not financial aid in the sense that a grant or scholarship is.  Do you call your mortgage or car loan aid? Of course not, they are just a payment plan.  That’s all a student loan is.

Second, student loan terms don’t call for payments to begin until months after the student has graduated.  The rate could be 0% or 20%, and the cash help to the student today is exactly the same.  What the student receives today is the assistance in the form of the principal amount of the loan being paid to the college he or she is attending.  The interest rate on that loan is irrelevant today.

Finally, is this good public policy?  Move ahead four years, two graduates earn their diplomas.  One has parents who qualified for need-based aid, one does not.  Why does the first student deserve a lower interest rate on his loan going forward?  They each are competing for jobs in the marketplace, using their education and experiences and talents to make a living.  Does it make sense to handicap their financial futures in such a way?

Here’s a better solution.  What is the lower interest rate on a ten year loan that starts repayment after graduation worth to a student today? Answer: $3,600.  So let’s give students that qualify for need based student loans $3,600 in aid today, and let everyone pay the same rate after graduation.

UVA Differential Tuition

The McIntire School of Commerce at UVA will cost $4,000 more per year than other undergraduate programs in 2012-13.  This extra charge is known as “differential tuition” and will apply to in-state and out of state students alike.  This extra charge will increase the cost of attendance by a like amount, bringing the COA for McIntire students to close to $30,000 per year.

For families with Virginia Prepaid 529 plans (VPEP) who thought they had tuition and fees covered, think again.  This differential is not covered by VPEP, according to UVA.  You will want to budget accordingly.  This is not an isolated occurrence either; the concept of different tuition rates for different course work is growing among community colleges and public institutions.  Parents, if your son or daughter is interested in a specialized area of study (like business, engineering, or nursing), be sure what the college charges for all four years so you can plan ahead.

Student loans at 50?

According to a piece in the Washington Post by Ylan Q. Mui, student loans are not just for students.  The Federal Reserve Bank of New York released data that show that roughly 20% of student loans that are in default are owed by borrowers over the age of 50.  Ms. Mui attributes this to co-signing, to adults returning to college, and to the inability of borrowers to discharge student loans through bankruptcy.  Who knows.  Borrowers over 50 would have gone to college in the 1970s and 1980s and college was not so expensive then, nor were loans so easily available, so these debts are most likely not lingering from their undergraduate years.  And, note that the 20% figure is for loans in default, so it’s not just that they have the loans, it’s that they aren’t paying.

What does that mean for the hordes of new borrowers who are leaving college with average loans of $25,000 and facing a grim job market?  Student loans might affect life decisions like getting married and buying a home.  (Theories have been postulated that the decline in marriage rates is due in part to debt problems.) The loans certainly delay retirement savings since money is being diverted to repayment of debt.  Now, with data showing the impact on seniors, the real effects might be worse than we knew, at least for some families.

The clear takeaway:  avoid debt if you can.  If you have to include loans in your financial aid package, treat them with respect.  Make a financial plan for your future that shows what you expect to earn after college, what you will need to live on, what you can donate, and what you need for debt.  Parents:  no one will make your teenagers do this if you don’t.

Shocking report about Virginia colleges

Most parents don’t really know what is going on during four years of college.  We know what it costs, certainly, but beyond that, we only hear what is reported through the filter of our young adults.  We don’t see the opportunities not taken, the courses not offered, the ability of the teachers to connect.  Not that we necessarily should; our kids are on the road to adulthood and are those things really our job?

So when you read the report issued by the American Council of Trustees and Alumni, you will be shocked.

• Over 33% of Virginia schools do not require math.
• No Virginia schools require a course in economics.
• Only two schools require a basic course (one) in American history or government.
• The notion of a core curriculum as fundamental is only lip service.
• At 22 of the 39 colleges, less than 50% of students graduate in 4 years.
• At 17 of 39 schools, tuition and fess (notice this excludes room and board and living costs) now represent more than 40% of the median household income.
• Facilities are significantly underutilized in terms of hours of average weekly use.
• Most colleges require all sorts of testing of students before they are admitted.  Only a small handful of Virginia schools participate in any sort of academic accountability program once the students are enrolled.

Parents and students, are you getting what you are paying for? 

SAT Scores – What difference can 10 points make?

Quite a bit apparently.

The New York Times reports that a senior official at Claremont McKenna in California has been submitting false SAT scores to publications like the U.S. News & World Report for six years.  The falsified scores were inflated by an average of 10 to 20 points for each reading and math.  The administrator in question has resigned.  Apparently the motive was to improve the college’s ranking in guides that count SAT scores as one of the ranking criteria.  What a sad example to set for students.

FAFSA Tips

Here are a few things to keep in mind while you are working on the FAFSA.

If this is your first time dealing with the FAFSA, it can be intimidating.  We suggest you run the FAFSA Estimator first.  It takes less time to fill out and it will give you a chance to get comfortable with the questions before the “test”.  It can be found at null

Decide who is in charge, parents or student?  The FAFSA will be in the student’s name, using his or her social security number, birth date, driver’s license and financial information.  But the real focus of the FAFSA is parental income and assets, and most parents prefer to handle that information themselves.

If your tax return for 2011 is not yet filed, don’t wait.  Go ahead and file the FAFSA now using good estimates and make corrections later.  Be conservative in your estimates; otherwise, the changes you make might yield some unwelcome surprises. 

Most of all, if you think you don’t need to file because there is no reason to, you might be mistaken.  Drop us a note and we’ll help you determine if filing is worth your time.

FAFSA for North Carolina Residents

The North Carolina General Assembly made significant changes in how the state of North Carolina awards state financial aid.  A single, new need-based scholarship will replace a number of old scholarship and grant programs.  Eligibility for this new scholarship will be based on the results of the FAFSA.  But here is the biggest takeaway: 

The new scholarship will be awarded first-come, first-served. That means you want to get your FAFSA in immediately if you expect to qualify for aid from the new program.  Students who are legal residents of North Carolina with EFCs of $15,000 or less and who meet the eligibility of the Pell Grant Program will be eligible.  Check with your school’s financial aid office for more details.  If you are unsure, call their office, this news is so new that many websites are not yet updated with current information.

This is only true for North Carolina residents.  Virginia residents can continue to observe priority deadlines of specific colleges and scholarship programs.  Always check the deadlines, and file sooner rather than later.  You can file the FAFSA without waiting for your 2011 tax return to be completed.  You do this by using estimated information and making corrections when the return is done.

Newspaper Readers – Calculator Report Here

NPC HANDOUT

Please follow the above link for our detailed report on Virginia schools’ net price calculators.  If you have any questions, simply drop us a note.  You can also subscribe to our free monthly newsletter using the button at the top of our home page.  Thank you to the Times-Dispatch and the Daily Progress.

Finding net price calculators

Colleges are required to have net price calculators on their websites, but they are not required to make them easy to find.  The best idea is to look under the Financial Aid section.  We put together the following table of clickable links to 27 Virginia colleges’ calculators. (Note: Links updated October, 2019 – please report a broken link here.)

Deadlines Move Up

Most parents and teenagers know that deadlines are important when it comes to applying for college.  The “system” is built around a certain timing – start getting serious in the spring of junior year in high school, take tests, apply in the fall and winter of senior year, hear back in the spring, make a decision, and graduate.  It’s been that way for years.

But it is changing, subtly.  Students are applying earlier and earlier, and now, colleges are moving up application deadlines.  No longer is January 1 or February 1 the only important date.  Some schools are encouraging applications beginning as early as September!  The new popularity of Early Action programs (as opposed to Early Decision) means that most students will have at least one admissions decision by Christmas.

What does all this mean?  First, you have to know each of the deadlines for every school on your list.  You cannot assume it will be the same as last year, this is a rapidly changing area.  Second, merit aid may have its own deadlines, especially for early applicants.  Third, for families with juniors in high school, you need to be focused on college now.  Do not wait until the spring to get started. 

The entire calendar has shifted forward.  Get started sooner so the shift does not catch you off-guard.  For seniors, be meticulous about your deadlines.

Getting through the essay

Students, if you are having a tough time with your college application essays, here are some suggestions on what you can do.

First, acknowledge where you are in the timeline.  You’ve put off the essay and now you are swamped with important schoolwork, extracurricular demands, and your social life.  It’s hard to find time to sit down and write an essay and the applications aren’t due today so what’s the big deal?  Your parents are frustrated and you want them to get off your back.  You’ll get it done.

But inside, you aren’t quite so sure.  What will you write about?  Where will you find the time?  Will it be any good?  Let’s take those one at a time.  First, on the subject, get out your list of colleges that you might apply to.  Make a list of the essay prompts, or questions, for each college.  The ones that use the Common App will have the same prompts, plus they may have a supplemental question or two.  If you are technologically inclined, there is an iPhone app that has every essay question from every school.  This list will help you organize your thoughts and keep you from writing more essays than necessary.

When you have your list, read it over to see what topics grab you.  Go with your first, immediate impressions.  Don’t over think this.  Highlight those and discard the rest.  Your essay will be one of the highlighted topics.  You don’t have to decide which topic it will be right now, so put that list aside.

When will you write it?  If that means when will you have a few uninterrupted hours of peace and quiet and no distractions, you won’t find the time.  Ever.  But you don’t really need that, that concept is just another crutch you are using to keep from getting it done.  Dive in tonight with 15 minutes of writing.  Not one hour, just 15 minutes.  No distractions, no food, no computer, no smartphone.  What you write tonight will not be your essay, it will simply be a way of getting your creative juices flowing.  Pick a topic you like:  what’s a favorite Halloween story of yours?; what was your favorite vacation?; who is your favorite relative and why?.  The topic does not matter, just grab one and write non-stop for 15 minutes.

You’ve made great progress just getting to this point, so now we’ll tackle the final question:  will your essay be any good?  The one secret to getting the most out of your writing is you need a good editor.  Every book you’ve ever read has been edited, and edited, and edited .  Your essay should be too.  This means if you want your best effort, you will not write your essay in one sitting.  Think in terms of drafts – get your first draft out in one sitting, and then turn it over to your trusted editor.  For most students, that can be a parent (one parent, don’t complicate it with two).  If that doesn’t work for you then ask a teacher or mentor at school.  Ask them now if they will accept that role, don’t wait until you have the draft written.

 So, three jobs:

 1.  List the potential essay prompts from your schools; read them over; highlight the ones that grab you.

2.  Write 15 nonstop minutes tonight on a topic of your choice.  Show yourself you can do it.

3.  Ask a parent or teacher if they will be your essay editor.  Commit a date by which you will give them your first draft.

If you start by realizing where you are, you can follow this clear plan on how to get to where you want to be.

Common App on a Mac – Problem?

There have been some early reports of problems for Common Application users with copy/paste on a Mac running Lion.  Suggestion:  try to copy and paste some sample text into the Common App before you get too deep into the application.  You don’t want to find that you cannot paste your essay one hour before the deadline.

We’ll keep you updated on this, but right now, PCs seem to work fine.

How many colleges should I apply to?

8.

Does that surprise you?  It’s tongue in cheek.  There is no correct numerical answer to this question, but there is a correct way to figure out the answer that works for you.

Two caveats up front:  First, do not apply to any schools that you absolutely will not go to;  even if they were they only school that admitted you, you would still not go.  Don’t waste their time or yours just because someone else wants you to include that college.  If that’s one of your parents, this is a great chance to have a level-headed discussion with your mom and dad.

Second, do not apply to any school that you cannot pay for.  If you don’t know what you can pay for, this is time to talk to your parents about that.  If you or your parents get stuck here, we can help, drop us an email. 

So how many schools should you apply to?  Start with at least two or three schools that will likely admit you.  You can determine this by looking at the 75th percentile of the SATs and GPA for last year’s freshman class which you can find on Collegeboard.com or College Navigator.  Be realistic about where you stand and if you need to set your sights lower, do it.

Next, include at least one or two schools that you would like to go to, but you don’t think you are a shoo-in for.  These are your reach schools.  If you have a low probability but really like the school, go ahead and apply, but (1) please don’t get your heart set on attending and (2) don’t expect much in the way of financial aid.

Finally, round out your group with two or three ‘other’ schools, ones that you like, ones that you are more in than out admissions-wise.  If most of your other college choices are public schools, add one or two private schools here.  You might be surprised by the aid you receive, and unless you are certain about the type of college you want to attend, it can be nice to have a choice of types when you have to make the final decision.

The old advice about dividing schools into groups for applications makes sense.  But make those groups thoughtfully, and you’ll be happier with the results.

Seniors often wonder if Early Action is a good way to apply?  Look at your transcript and current test scores.  If those put your best foot forward, by all means use Early Action.  You’ll get a notification from the college early on, and your spring semester will be less stressful.  You’ll have more time for follow-up visits.  But you won’t get financial aid awards any earlier;  those will still come in the spring.

Longwood University has an interesting twist on Early Action called Immediate Decision.  Students who qualify can attend a weekday information session and tour through December 2 and Longwood will let you know your status when you finish your tour.  That’s immediate!

Live like a broke college student

Teenagers say in survey after survey that they want to contribute to the cost of their college education.  The majority seem to feel a sense of responsibility, but they also don’t have a lot of money to chip in.  So what can you do to help out?

Reorient your spending!

Make it your primary goal to live like a broke college student.  You don’t need to wait until you go to college to do this, you can start right now.  Think of all the discretionary expenses you have, the things you’ve gotten into a habit of spending (most likely your parents) money on.  Your clothes, your hair, your unlimited data plan, your entertainment…how would you spend less if you had to?  “But I like Polo shirts,” is not an answer. 

Tell your parents what you are doing and make yourself accountable.  You’ll have to make some hard choices and not keep doing the same things you have been, but it’s worth it for the lessons you will learn and the money you will save.

If you don’t know where to start, being by tracking your spending and the spending your parents do on your behalf.  What’s your financial footprint?  Once you have a couple months of data, you can start identifying where you can cut.

Sooner or later, your standard of living is going to decline sharply.  College can be a great, safe time for that.  Most things you need (food, activities, shelter) are provided for you and you can really focus on keeping the discretionary expenses down.  Find new ways to save money…share, be cheap, get by. 

When you get out of college, hopefully you’ll have an income, but your newfound savings habits will still be with you.  You’ll have extra money to save, and if you can do that, it will be worth more than much of what you learned in class.

Helpful Advice

The Wall Street Journal Sunday edition had a nice article on saving for college.  The idea was to give parents advice on what to do using a three-year countdown until college starts.  The advice was fine, but what happens so often with articles like this is that the advice has to be apply to so many readers that it is very generic.  It is certainly well-intentioned but even trying to follow some of it is daunting.  Here’s a sampling:

About 529 plans:  if your 529 plan is “underperforming” or is high-cost, you can roll it over to another plan but beware of the fees.

On financial aid:  start juggling money three years out so it won’t weigh as heavily in the financial aid calculations.  One year about, the article suggests that you “submit all necessary paperwork.”

On loans:  two years out, start looking at loan options – federal loans for students and parents and private bank loans which have variable or fixed rates.

The idea here isn’t to bash the article, it is fine for generic advice.  It is to ask is that advice helpful to you as a parent?  What specifically do you do with that, and is that a good use of your valuable time?

We believe that good guidance for college is targeted to your family’s situation, so that you know what to do when, and you can make informed decisions.  Contact us to find out what that means for you.

Moodys Downgrades College Students

With all the talk about debt downgrades and ratings agencies, we thought it would be timely to consider what one of them has to say about student loans.  From Moody’s recent report, Student Lending’s Failing Grade:

“Unless students limit their debt burdens, choose fields of study that are in demand, and successfully complete their degrees on time, they will find themselves in worse financial positions and unable to earn the projected income that justified taking out their loans in the first place.”

Borrow less and study smarter or you’ll risk default.  Remember, you can’t walk-away from student debt.  Take it seriously.

So what do you do if you have to borrow?

If you are a high school student, take a realistic, cost-based approach to your college selection.  The conventional notion of reach and safety schools is not your current reality.  What will college cost you?

If you are a college student, pursue courses and activities that will lead to productive careers that are in-demand.  Learn what majors matter.   How can you stand out from the crowd?

Step by Step Guide to Getting Cheap Textbooks

Time to get your textbooks. Here’s what you do, step by step.

First, get the ISBNs of the books you need. How do you do that? You should have that information from registration, but if you don’t, call the student bookstore at your school and ask them what the books are for your classes, ask the ISBNs and how much the bookstore charges. (The author and title are not always enough information to be sure you get the correct editions.)

Second, go to Amazon Textbooks and then Chegg.com and search by ISBN.

If you want to use Amazon, sign up for Amazon Student using your college email and you can get free two-day shipping for one year. You won’t believe how convenient that will be, not just for these books but for any of the items Amazon sells.

Third, with the pricing information, decide whether you want to

• buy new from the bookstore (bad idea)
• buy new or used from Amazon (much better) and then trade them in at the end of the semester (fantastic idea)
• rent from Chegg (compare their price to Amazon’s used purchase and then trade-in price)

 Fourth, order them and have them shipped to your home now so you get to school and get too busy to be buying books.

Fifth, tell your parents how much money you saved. They’ll appreciate your can do attitude.

Congratulations!  If you would like a free worksheet we’ve prepared to organize this for you, drop us a note.

It’s Tuition Bill Time

Tuition bills for the upcoming fall semester are coming in now. If you haven’t seen one in the mail, check online through your student’s online ID, since larger schools often send bills electronically. Many schools offer different payment options, including electronic funds transfer from a checking account, credit card payment, and good old fashioned checks. Credit cards are not always the best option however, since there are often large service fees charged by the college’s credit card processor.

Writing a check is often the best option. It makes sense to limit giving out your bank account information, and a written check will provide easy documentation for tax considerations.

Many colleges offer payment plans. Payments can be spread out over a number of months and any charges to set up such a plan are relatively small. You may have to agree to electronic payment to use such a plan, but that might be worth the risk.

If you plan on using money in a 529 plan, you usually have three options. The withdrawal can be paid to the college, to the beneficiary, or to the account owner. You will want to choose the option that is easiest for you and best fits your needs. Generally speaking, payments directly to the college are least advisable since you lose control over the entire process. Remember to allow sufficient time for the withdrawal to be processed by the 529 plan.

If you have specific questions about your situation, please drop us a note and we’ll be glad to help.

Counting Down

The last summer home can be especially trying for parents with rising freshmen. Ideas of some special bonding time, family vacations, and special dinners are wonderful but often not shared by the kids. They are more interested in being with their friends, the friends they will be leaving in a few weeks. Mom and Dad aren’t going anywhere after all!

These differing perspectives are fine unless Mom and Dad fail to see where their teen is coming from and push too hard to do the things they want to do. Talk to your son or daughter now and get them to commit to one or two family activities that you feel are important. Then let them have the rest of their time. Maybe they’ll spend some of it with you if they don’t feel like they have to. Also, there will be time hanging out when they are just around home or running errands with you that can count as quality time too. Value it.

The best part is that a couple of summers from now they likely will be more interested in spending time with you than they are this summer!

And for those of you who just can’t wait, parents or teens, you might want to Google “countdown timer”.

Summer Tips for Graduates

Graduating seniors:  Last October when you were mired in essays and applications, you probably thought graduation would never get here.  Well it’s here!  Congratulations and well done – you deserve a pat on the back for both your perseverance and your accomplishment.

This summer is a great time to get a few things straight before heading off to college.  The biggest one that many students neglect until the last minute is figuring out your spending money in college.  If you have your money lined up for the year already or are counting on a job this summer for it, you’re all set.  But if you think you’ll need some from your parents, you’ll want to address this now.  Don’t wait for when you are packing up the car!

Start by dividing your expected expenses into one-time expenses and monthly recurring ones.   For example, things for your dorm room, a few new clothes, your textbooks – these are one-time expenses.  Keep these separate from the recurring ones, things like money for going out, concerts, movies, and having fun.  Colleges are great sources of free activities but many things cost money.  If you’ll have a car, add in gas and parking costs.  If you plan on joining a fraternity or sorority, add in any costs for that.

Once you have your estimate, ask your parents to sit down and go over it with you.  If you’ve done a good job, they will be more likely to listen to what you have to say.  They might not hand you cash, but it will start the conversation going, and you’ll be beginning your journey toward financial independence!

You also want to spend some time on the mechanics – what bank will you use? Will you have access to that bank’s ATM at college?  How will your parents get you money if they need to?  What if there is an emergency need for money?  Spending some time on these questions now will save you lots of headaches in September.

For more on the ins and outs of your spending money, drop us an email and we’ll send you more tips.

Two more summertime ideas:

• If you have a student loan in your financial aid package, you must do online “entrance counseling” before you can get the money.  Do that this week.  It will only take 20 or so minutes and it’s required.  Your school’s financial aid office will give you the details of how to do the counseling.

• When you register for classes (most likely at orientation), write down the textbooks the classes will be using.  Colleges are required to give that information to you.  You can then use it to find cheap alternatives to paying retail price at the student bookstore for introductory level books you’ll only use once.  This can save you hundreds of dollars and there’s really no excuse not to do it.  Let your parents know you want to do it too, they will appreciate it.

Your newfound freedom brings with it newfound responsibilities, especially financial ones.  Use the time you have this summer to make a plan and you won’t be living like Sugarland sings:

“Dear Mom and Dad,

Please send money, I’m so broke that it ain’t funny.

I don’t need much, just enough to get me through.”

Saving for College with Young Children

Parents of young children often ask what the best way is to save for college.  With so many choices out there, it can be confusing to consider 529s, IRAs, Savings Bonds, Coverdells, UGMAs,  Zero Coupon Bonds, Insurance policies and a number of others.  But you don’t need to make it complicated, you need to start setting some money aside.  The specific instrument you invest in is not the important point, it is that you are saving at all.  We suggest opening an account (in your name, not your kid’s) with a good mutual fund and making regular deposits.

The reason is simple:  you can always change the fund or tweak the amount, but you cannot get the time back, and time is your biggest ally when you have a financial goal to save for.

Once you’ve started your college fund, you can take some time to investigate the particulars of college savings:  what the options are, how they affect taxes and financial aid, what the dollar goal should be, and make appropriate adjustments.  Those are complex questions and we are happy to help you figure them out, but please don’t delay getting started.

Financial Aid Award Letters

Acceptance letters bring a huge sigh of relief across the country.  But arriving shortly behind those is the financial aid award letter.  This is the letter that needs to be scrutinized closely, and colleges do not make it easy to do that.  Don’t let your excitement about being accepted interfere with the need to review and understand the terms on which you’ve been accepted!  Here are some tips to do that.

First, schools use different terminology for the same thing.  It’s important that you understand exactly what is in the letter line by line.  What are the important items to determine?

1.  What’s the real cost of attendance?  For this you’ll need to do a little research.  Check out the college’s own website and search for “cost of attendance”, or go to CollegeBoard.com, search for the college and click on the Cost & Financial Aid tab.  Write down the line items:  Tuition and fees, Room and board, Books and supplies, Personal expenses, Transportation, and Other expenses.  Of these, only the first two are determined by the college, the others are simply estimates of what you will spend.  Colleges may supply estimates in their cost of attendance or they may not.  You want to be sure each of these items is accounted for.  Books will not cost significantly more at one school than another, but transportation might.

2.  Next, separate the gift aid from the loans and work-study.

Gift aid includes any grants and scholarships whether from the college or an outside source.  You want to know:

• Is it for one year or for four years?
• Is there any performance requirement (GPA, etc.) for the grant?
• Does it come from the government (state or federal) or from the college?  Government budgets are under pressure, can you reasonably expect this amounts to be available in the future?

3.  Loans go by the name Stafford (either subsidized or unsubsidized), Perkins and PLUS.  Identify what is in your package, and be sure you know what the terms are.  Be sure there are no private loans in your package.  If you see anything other than Perkins and Stafford loans, make a note to ask about it.

Most important:  loans will be in an amount for one year, but you are planning on college for four years. Stafford loan amounts are determined by the government and actually increase as you get older.  You need to understand clearly what your loan  payment will be when you graduate!   Please do not skip this step.  Calculate what your loan payments will be, the schools will not do it for you.  If you need help with this step, drop us a note.

Work-study employment is not guaranteed.  Those jobs are coveted and can disappear if you wait too long.  If that is part of your package and you want to accept it, don’t delay when it comes time to apply for that job.  Be sure you give some thought to the implications of working while in school and that you are comfortable with that.

4.  Finally, with the numbers you now have, calculate your out of pocket cost.  That’s the cost of attendance less the free money parts, the gift aid and work-study.   This tells you what you will pay, either now or in the future (through repaying your student loans.)

If you have questions about a specific letter, the financial aid office of that college can help sort it out for you.  Do not accept any award that you don’t fully understand!

For some additional reading and a suggested comparison table, take a look at Julie Morgan’s piece.

GRASP Last Dollar Scholarships

STUDENTS ELIGIBLE TO APPLY

• Met with the high school GRASP advisor during his or her senior year

• Possess at least a 2.0 cumulative grade point average

• Will graduate from high school spring of 2025

• Demonstrate unmet financial need (A college financial aid award letter will be requested before the scholarship is granted.)

• Will attend a post-secondary school in Virginia (public or private)

• Have successfully filed a Free Application for Federal Student Aid (FAFSA) or the Virginia Alternative State Aid (VASA) application.