Personal Finance PowerPoints - Part 6

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Personal Finance PowerPoints - Part 6

  1. 1. Personal Finance Section Paying for Education
  2. 2. Personal Finance Section <ul><li>Learning how to finance your tuition is an education in itself? </li></ul><ul><li>By the time you finish paying for college, you may have shelled out enough money to buy a luxury car, a small yacht, or perhaps even a house. </li></ul><ul><li>That does not count the cost of graduate school or professional school. </li></ul>
  3. 3. Personal Finance Section <ul><li>The earning power of your education will affect you the rest of your life. </li></ul><ul><li>The short-term sacrifice is generally worth the potential long-term gain. </li></ul>
  4. 4. Personal Finance Section <ul><li>Decisions, Decisions </li></ul><ul><ul><li>The average cost of tuition at public and private universities more than doubled between 1985 and 2000, while average salaries rose only about 12%. </li></ul></ul><ul><ul><li>Tuition is the cost of enrolling in courses. </li></ul></ul><ul><ul><li>Costly fees have been added to university costs. </li></ul></ul><ul><ul><li>Financial aid rose to meet increased the need, but in term of loans, not scholarships. </li></ul></ul>
  5. 5. Personal Finance Section <ul><li>Types of School you may want to attend </li></ul><ul><ul><li>What school do you want to attend? Why? </li></ul></ul><ul><ul><ul><li>Can you find the educational resources that you want at a less-expensive public school, not a private university. </li></ul></ul></ul><ul><ul><ul><li>Private universities are more expensive than public universities. But private schools are more generous with financial aid. </li></ul></ul></ul>
  6. 6. Personal Finance Section <ul><li>Types of School you may want to attend </li></ul><ul><ul><li>How much does location matter to you? </li></ul></ul><ul><ul><ul><li>Tuition costs vary by region of the country. </li></ul></ul></ul><ul><ul><ul><li>Schools in the Southwest region are cheaper. </li></ul></ul></ul><ul><ul><ul><li>Most expensive schools are in the East. </li></ul></ul></ul><ul><ul><li>How much debt do you want to incur? </li></ul></ul><ul><ul><ul><li>Don’t take on more debt that you can handle after graduation. </li></ul></ul></ul>
  7. 7. Personal Finance Section <ul><li>Each year, millions of dollars are available for college bound students to have access to. </li></ul><ul><li>Three major types of financial aid available </li></ul><ul><ul><li>1. Grants and Scholarships </li></ul></ul><ul><ul><ul><li>Based on academic ability or athletic ability. </li></ul></ul></ul><ul><ul><ul><li>There are lots of “Free Money” available through Pell Grants, Fed. Supplemental Educational Opportunity Grants, and etc. </li></ul></ul></ul><ul><ul><ul><li>Companies sometimes offer scholarships to employees children. </li></ul></ul></ul><ul><ul><ul><li>Many scholarships available for all fields of study – if you know what you want to major in. </li></ul></ul></ul><ul><ul><ul><li>Reserve Officer’s Training Corps is available to all military branches. </li></ul></ul></ul>
  8. 8. Personal Finance Section <ul><li>Three major types of financial aid available </li></ul><ul><ul><li>Work-Study Programs </li></ul></ul><ul><ul><ul><li>College students work their way through school. </li></ul></ul></ul><ul><ul><ul><li>Many colleges offer work-study programs that provide on-campus jobs for students receiving financial aid. </li></ul></ul></ul><ul><ul><ul><li>Most of these programs are federally funded. </li></ul></ul></ul><ul><ul><li>Loans </li></ul></ul><ul><ul><ul><li>Students and parents can apply for college loans. </li></ul></ul></ul><ul><ul><ul><li>Most college loans have a low interest rate and a generous repayment schedule. </li></ul></ul></ul><ul><ul><ul><li>Most loans do not become due until you graduate or quit attending school. </li></ul></ul></ul>
  9. 9. Personal Finance Section <ul><li>One simple equation that will cut through the confusing information about financing. </li></ul><ul><ul><li>Total Cost – Total Aid = What you OWE </li></ul></ul><ul><ul><li>The idea is to reduce the amount you’re going to owe by applying for as many sources of aid as possible. Most students qualify for some kind of financial aid. </li></ul></ul>
  10. 10. Personal Finance Section <ul><ul><li>How much you receive depends on the following criteria </li></ul></ul><ul><ul><ul><li>Income - your income and your parents </li></ul></ul></ul><ul><ul><ul><li>Number of college students in your family </li></ul></ul></ul><ul><ul><ul><li>Family assets and expenses </li></ul></ul></ul><ul><ul><ul><li>Available pool of aid at the school you plan to attend </li></ul></ul></ul><ul><ul><ul><li>Number of students applying for aid in a given year and their financial need compared with yours. </li></ul></ul></ul>
  11. 11. Personal Finance Section <ul><li>Types of Lenders </li></ul><ul><ul><li>1. Federal Government/Department of Education </li></ul></ul><ul><ul><li>2. Private Sources – Banks or Financial Institutions offer regular commercial loans for education. These loans carry higher interest rates than federal loans. </li></ul></ul><ul><ul><li>OR </li></ul></ul><ul><ul><ul><ul><ul><li>Ooops Wrong Banks! </li></ul></ul></ul></ul></ul>
  12. 12. Personal Finance Section <ul><li>Types of Lenders </li></ul><ul><ul><li>1. Federal Government/Department of Education </li></ul></ul><ul><ul><li>2. Private Sources – Banks or Financial Institutions offer regular commercial loans for education. These loans carry higher interest rates than federal loans. </li></ul></ul><ul><ul><li>OR </li></ul></ul>
  13. 13. Personal Finance Section <ul><li>A word to the wise – PAY UP – repay your student loans. </li></ul><ul><li>Computerization and more vigorous collection efforts are resulting in more cheaters getting caught and penalized. </li></ul><ul><li>If you run into trouble repaying your loans, call your lender, who can help you workout a manageable repayment plan. </li></ul>
  14. 14. Personal Finance Section <ul><li>Applying for Financial Aid </li></ul><ul><ul><li>Required Forms – You have to complete the Free Application for Federal Student Aid (FAFSA) to qualify for any government aid. </li></ul></ul><ul><ul><li>Other forms are required to get aid </li></ul></ul><ul><ul><li>Required Documents </li></ul></ul><ul><ul><ul><li>Proof of income – W-2 </li></ul></ul></ul><ul><ul><ul><li>Mortgage statements </li></ul></ul></ul><ul><ul><ul><li>Proof of financial hardships – i.e. high medical expenses </li></ul></ul></ul>
  15. 15. Personal Finance Section <ul><li>Tip: </li></ul><ul><ul><li>If you have savings, use it to pay off any debts you may have before applying for aid. You don’t get a break for having high credit card debt, but you will be expected to contribute about 1/3 of all savings. So us your savings first to pay down your debt. </li></ul></ul>
  16. 16. Personal Finance Section <ul><li>Review: </li></ul><ul><ul><li>What are some of the ways that students deal with skyrocketing tuition costs? </li></ul></ul>

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