Student Loans

Managing Your Student Loan
With no federally subsidized college tuition in America, low-interest federal loans have always been second best. But now you’re graduating, and the government will want its money back.

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After you graduate, you have a period of time before you have to begin repayment on your student loans. This “grace period” will be six months for a Federal (FFEL) or Direct Stafford Loan and nine months for Federal Perkins Loans. Before you graduate, you should receive information about repayment, and your loan provider will notify you of the date your loan repayment begins.

It can’t be emphasized enough the importance of making your full loan payment on time either monthly (which is usually when you’ll pay) or according to your repayment schedule. If you don’t, you could end up in default, which has serious consequences.

Student loans are real loansjust like car loans or mortgages–and they have to be paid back on time. You do have a choice of repayment plans if you received a FFEL or a Direct Loan. But Federal Perkins Loans don’t have repayment plan choices; you generally have up to 10 years to repay. Your monthly payment will depend on the size of your debt and the length of your repayment period. If you don’t repay your student loans on time or according to the terms of your promissory note, you might go into default, which will affect your credit rating. There is assistance for borrowers having difficulty repaying their education loans, including deferment and forbearance.

If you default, it means you failed to make payments on your student loan according to the terms of your promissory note (the binding legal document you signed at the time you took out your loan). In other words, you failed to make your loan payments as scheduled. Your school, the financial institution that made or owns your loan, your loan guarantor, and the federal government can all take action to recover the money you owe. Here are some consequences of default:
• National credit bureaus can be notified of your default, which will harm your credit rating, making it hard to buy a car or a house.
• You would be ineligible for additional federal student aid if you decided to return to school.
• Loan payments can be deducted from your paycheck.
• State and federal income tax refunds can be withheld and applied toward the amount you owe.
• You will have to pay late fees and collection costs on top of what you already owe.
• You can be sued.

If you’re worried you might miss a payment, call and talk to your loan servicer about different options. In some cases, for example, you might be able to consolidate your loans or reduce your interest rate if you sign up for electronic debiting. Just know that you should never have to pay to talk to someone about repayment options.

A Consolidation Loan allows you to combine all the federal student loans you received to finance your college education into a single loan. There are many companies and organizations who will offer you the opportunity to consolidate your loans. Consolidating can be very beneficialit typically offers one payment to make and the possibility of a lower interest rate. You can only consolidate once for the length of the loan.

Cancellation and deferment
Do you want to teach? If you’re a teacher serving in a low-income or subject-matter shortage area, it may be possible for you to cancel or defer your student loans. Something to think about. Get more information at


Saving Money


Saving Your Hard Earned Money
When you’ve just graduated and you’re looking toward the future, it’s difficult to think about saving for a rainy day, much less retirement. But as you move through your career, it’s important to save for all of life’s exciting events (and those occasional tough times) that await you down the road. Remember, saving is not always about how much you save—it’s simply the fact that you do save and allow your money to grow over time.

Retirement plans
Many of you will have the opportunity to save through employer-sponsored retirement plans—often in the form of a pension, a 401(k) plan or something similar. The 401(k) plan is widely offered by private corporations. The 403(b) retirement plan is often offered by nonprofit employers and the 457 plan offered by government employers. Because the money you contribute in these types of plans most likely comes out of your gross income (meaning, your salary before it is taxed), all of these plans offer employees incentives for tax-deferred savings. In other words, you don’t pay tax on the money you put aside in these plans until you withdraw it.

How much should you save?
A good rule of thumb is to try to save 10 percent of your gross income (pre-tax). Whether you do that with a combination of savings plans (401(k) plan, bank savings account, piggy bank on your dresser, etc), or all in one place, always work toward the magical 10 percent. But if you can only save 3 percent now, then save that 3 percent and work your way towards 10 percent. When you start saving at a young age, it becomes part of your routine, and it has longer to add up and grow.

Protect Your Identity

How to Protect Your Identity

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In 2018 alone, there were nearly 19 million reports of identity theft in the United States. Identity theft involves someone else using your personal information to create fraudulent accounts, charge items to your existing accounts or even to get a job. You can minimize your risks by managing your personal information wisely and cautiously. Here are some ways to protect yourself from identity theft.

• Before you reveal any personally identifying information, find out how it will be used and whether it will be shared.
• Pay attention to your billing cycles. Follow up with creditors if your bills don’t arrive on time. Going paperless can help avoid concerns like this, as your bill will likely be sent via email or directly through your bank.
• Guard your mail from theft. If you’re concerned about the security of your mailbox, deposit outgoing mail in post office collection boxes or at your local post office. Promptly remove mail from your mailbox after it has been delivered. If you’re planning to be away from home and can’t pick up your mail, contact the U.S. Postal Service toll-free at 1-800-275-8777, or visit to request a vacation hold.
• When possible, require passwords to use your computer, credit card, bank and phone. Avoid using easily available information like your mother’s maiden name, your birth date, the last four digits of your social security number or telephone number, or any series of consecutive numbers. It’s a good idea to keep a list of your credit card issuers and their telephone numbers in a safe place.
• Don’t give out personal information on the telephone, through the mail or online unless you’ve initiated the contact or you know who the person is. If someone calls and asks for personal information, say something like, “I don’t like to give personal information away on calls I didn’t initiate. Let me call you back on your publicly-listed business number.” If the call is legit, the caller will give it to you; if not, you may save yourself from identity theft.
• Tear or shred documents like charge receipts, copies of credit offers and applications, insurance forms, physicians’ statements, discarded bank checks and statements, and expired credit cards before you throw them away. Be cautious about leaving personal information in plain view, especially if you have roommates or are having service work done. Before you trade up your computer or phone, wipe out any personal information.
• Find out who has access to your personal information at work and verify that the records are kept in a secure location.
• Be careful what you say on social media. Don’t include your home address and don’t make it obvious that you’re on vacation, like posting a photo of your boarding pass or luggage tag.
• Be wary of wifi when you’re in public places: Don’t send personal information via an unsecure wifi connection. You might look into purchasing a virtual private network, or VPN, which creates an encryption between you and the remote VPN server, thus masking your identity. Even seemingly harmless browsing can be information your internet service provider can sell without your permission.
• Never carry your social security card; leave it in a secure place at home. Give out your social security number only when absolutely necessary.
• Order your credit report every year from to make sure it is accurate and includes only those activities you’ve authorized.
• Only carry the identification that you actually need when you go out.

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Organize Your Finances

Organizing Your Finances FAQ

1. How do I get financially organized? Automate as much financial duties as you can—do direct deposit and online banking and set up online/automatic bill payments to avoid late fees. Check out free services like and PersonalCapital that allow you to keep track of all of your accounts in one place. Also, only keep as many accounts as you need, and not more. Don’t be dragged into opening accounts just for coupons or bonuses. To avoid getting buried in paper, sign up for paperless billing and account statements, but make sure to have an email account where all of your notifications go, so you don’t lose track or miss a payment.

2. What are some things I can do to get and keep my financial house in order? As a recent grad, make sure you have a handle on any student loans you may have and when those payments will start. Make sure you understand your rights and responsibilities, and enroll in a payment plan that will work for your situation. You also need to understand your paycheck and employee benefits. This might be the first time you’ve had to file taxes, pay for insurance and can save for retirement. Another key to financial stability is to have a small amount of money set aside for emergencies. Even $1,000 can help avoid getting into trouble due to something unexpected.

3. How do I begin to budget? It’s time to get real with yourself and face the numbers. You need to know how much money is coming in and how much is going out. You need to know how much you owe and to whom, interest rates, payment terms, dates, etc. Excel spreadsheets can help you organize all of this, and plenty of home budgeting templates can be found by doing a quick Google search. Or use a budgeting apps like You Need a Budget (YNAB).

4. What about all those statements, receipts and other financial papers that pile up? What’s best to do with all those? Try to store as much electronically as possible. Keep anything tax-related for at least seven years. Most paper bank and credit card statements can be shredded once you verify that all the transactions are accurate and the balances are correct. Monthly bills can usually also be shredded or deleted once the next month’s bill comes and you’ve verified it’s correct. Or simply file it and keep it for the year. Find a system that works for you and stick to it. That way, bills don’t get missed because they’re buried in a pile and, when you need to access a particular statement, you’ll know where to find it.

5. Anything else I should know? A password management program like LastPass helps you keep track of all of your different online financial accounts and keep the passwords secure.

Top tips on being financially organized:
• Start with cash flow: Know how much is coming in and how much is going out for bills and spending.
• Set a budget and stick to it. Write it down or use an app to help.
• Know how much you owe in debt, who you owe it to, how long it will take to pay off, and what the interest rate is.
• Know your credit score and use the free website to track your credit reports yearly.
• Have some money set aside for emergencies.
• Save for goals like retirement, travel, buying a house or buying a car in accounts that are meant for that purpose so that you can track your progress.

Source: Nannette L. Kamien (Gamma-DePauw), principal, Inspiration Financial Planning LLC,


Insurance Coverage

No matter what Congress decides to do about the Affordable Care Act, it doesn’t change the fact that it’s important to have health insurance. It’s like car insurance: You pay for it and hope you won’t need it. If something unexpected happens, having health insurance could mean the difference between being able to move on from the situation and the potential of financial ruin leading, at its worst, to bankruptcy. As of now, children up to 26 years old can remain on a parents’ health insurance plan, but if this isn’t an option for you, then it’s best to arm yourself with some basic information about insurance as soon as possible.

When you choose an HMO, it usually means that you will select one doctor from a list of all the health care professionals in the plan, and that doctor will serve as your Primary Care Physician. This physician will coordinate all of your health care, which means that he or she treats you directly and, when necessary, manages your referral to specialists. The only exception to not going to your Primary Care Physician first is for visits to an OB/GYN or an emergency situation. When you choose a PPO, in most cases it means you have the ability to use any doctor or facility you choose within a network of providers. If the physician is “out of network,” additional fees may apply, but there still may be some coverage. A good way to determine which is right for you is to decide if you have current doctors that you wish to continue to visit. See if your doctor(s) is in the HMO plan that is offered. If so, then you may only need an HMO. But if your doctor(s) isn’t included in the HMO plan and you don’t wish to switch doctors, the PPO plan may be the better choice for you.

Cost considerations between HMO and PPO
HMOs tend to have low out-of-pocket expenses, including no deductible and low office co-pay amounts. There is usually no paperwork or claim forms to complete and some pre-existing conditions may be covered, but not all providers accept an HMO. PPO out-of-pocket expenses tend to be a little bit more than an HMO plan, but you may go to any doctor in the network at any time, without a referral, including all specialists. In a PPO, you’ll typically have a maximum you pay; after that, all costs are covered by your insurer.

Short-term health insurance
If you’re considering a short-term health plan to get you from college to a new job, for example, there are some things to be aware of: 1) Most short-term plans exclude preexisting conditions, so make sure you can get what you need; 2) If you begin treatment for a long-term illness under your short-term plan, the insurer can choose not to re-insure you once your plan has expired; 3) Short-term healthcare might not count as having “continuous coverage.” Changes to the Affordable Care Act may require continuous coverage in order to have any preexisting conditions covered. So, while these types of plans may be cheaper upfront, they may be much more costly in the long run.

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Do You need Life Insurance?

It depends on your situation. A good life insurance policy would handle the financial responsibilities you leave behind, so family members wouldn’t be burdened. Unlike the funds from an estate, the benefits from a life insurance policy will go straight to your beneficiaries, without any roadblocks. Several key questions listed below can help give you “yes” signals that you may need life insurance:
• Are you married?
• Do you own a business?
• Do you have dependent children?
• Are relatives (seniors, disabled) financially dependent on you?
• Do you possess a sizable financial estate?
• Do you currently have major financial obligations? (mortgage, multiple loans)


Credit Cards

Choosing and Using Credit Wisely

Chances are you’ve received (or will soon!) your share of “pre-approved” credit card offers in the mail, some with low introductory rates or other perks for recent graduates. Many of these solicitations urge you to accept “before the offer expires.” Don’t feel pressured by the marketing. Take your time to do your own research and shop around to get the best deal.

Credit terms and conditions affect your overall cost, so read the fine print before you agree to open a credit or charge card account. Also, just because a friend is opening a particular card, doesn’t mean it’s the right one for you. Each one has characteristics that might or might not work for you. Maybe you frequently travel to visit your parents, in which case a card with airline points would be great; or you’re a loyal shopper on, which has its own credit card with perks. There are several respectable websites for credit card comparisons, such as Just know that these sites often get advertising dollars from some of the cards they list.


Credit card fine print:
Introductory APR (Annual Percentage Rate). Is your card offering “6 months at 1.9% APR”? That sounds pretty great, right? But you need to find out what the APR will be once those 6 months are over. It could jump to more than 22%!
More info about an APR. The APR is the cost of credit, expressed as a yearly rate. It must be disclosed before you become obligated.

“Variable rate” cards. interest rates or other economic indicators–called indexes change. These plans are called “variable rate” programs. Rate changes raise or lower the finance charge on your account. The issuer must disclose to you that the rate may change and how the rate is determined, meaning which index is used and what additional amount (sometimes printed as “Prime + X%”) is added to determine your new rate.

Annual fees. Annual membership or participation fees range from zero to hundreds of dollars for “gold” or “platinum” cards. Be sure to factor this into your decision when selecting a card.

Transaction fees and other charges. If you aren’t careful, fees can add up quickly. Some issuers charge a fee if you use the card to get a cash advance, if you make a late payment or if you exceed your credit limit. Some charge a monthly fee whether or not you use the card. Do your best to avoid any additional fees.

Late payments. One late payment to a credit card can have devastating effects on your financial life. Some cards with low rates for on-time payments apply a very high APR if you are late even just once in any specified time period. These rates sometimes exceed 20%. Information about delinquency rates should be disclosed to you on credit card applications or in solicitations that do not require an application. Once your APR is raised because of a late payment, it’s difficult to get it lowered again. But it’s always smart to call if this happens—often, if it’s a first-time offense, you’ll be able to get the charge reversed and APR lowered.

Stolen cards. If you suspect your credit card is stolen, call the issuer immediately, as well as a credit reporting agency like Experian. Under the Fair Credit Billing Act, you can only be held responsible for up to $50 of fraudulent charges per card. If the card is an ATM or debit card, you may also be liable for up to $500 of unauthorized charges if you report the loss after 48 hours. If you report the loss before the card is used, you can’t be held responsible for any unauthorized charges.

Choosing and using a credit card
Nearly every day, you’re involved in some type of financial transaction. When you have a credit card, it can be tempting to use it too often, racking up debt before you know it. If you’ve ever seen the movie “Confessions of a Shopaholic,” you know how credit card abuse can get out of control. Interest and late fees add up to a lot more than that new pair of shoes cost. To keep you in check, think of your credit card as a bundle of cash instead of a handy piece of plastic. If you don’t have that money in the bank—or at least enough to pay minimum balances on time—don’t spend it.

More credit card considerations:
1. Shop around for the plan that best fits your needs.
2. Make sure you understand a plan’s terms before you accept the card.
3. Hold on to receipts to reconcile charges when your bill arrives.
4. Protect your cards and account numbers to prevent unauthorized use. Draw a line through blank spaces on charge slips so the total amount can’t be altered.
5. Pay off balances at the end of the month to avoid interest charges—or at least the minimum to avoid late fees.
6. Keep a record in a safe place separate from your cards of your account numbers, expiration dates and the phone numbers of each issuer to report a loss quickly.
7. Carry only the cards you think you’ll use.
8. If you do forget to pay a credit card bill and you incur a late fee, call customer service. They are usually agreeable to waiving the fee one time.

Your free credit report
Although you’re just starting to build credit, it’s helpful to request a free copy of your credit report at, especially if you plan to purchase a house or car soon. The Fair Credit Reporting Act gives Americans access to one free credit report every 12 months. Don’t get scammed into a website that asks for a credit card number to run a credit report; they’re notorious for hidden charges and sneaky monthly fees unless you cancel. Popular sites and also offer a free credit score from one of the three credit reporting agencies. When you order, you’ll be asked for your name, address, social security number and date of birth. To verify your identity, you may also need to provide some information that only you would know.

What is a credit report?
A credit report contains information on where you live, how well you pay your bills, and whether you’ve been sued, arrested or filed for bankruptcy. Nationwide consumer reporting companies sell the information in your report to creditors, insurers, employers and other businesses that use it to evaluate your applications for credit, insurance, employment or renting or purchasing a home. Get a copy every year so you can consistently see where you stand, and to spot any errors—and then get them fixed.