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Association News
Spring
Conference Report
Scholarship
Winners
Special Features
Focus
on Loan Counseling
Students
Hooked on Credit
Families
Don't Consider Cost
Welcome
Marjorie Arrington
PUBLICATION SCHEDULE
| Issue |
Due Date |
 |
Fall
|
9/15 |
| Winter |
12/01 |
| Spring |
04/15 |
| Summer |
06/30 |
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Renee Weekes
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Focus
on Loan Counseling:
Today’s Economy Offers Opportunity
to Teach Smart Spending
Submitted by: Tasha
McDaniel, School Training Director, Great Lakes Higher Education
Guaranty Corporation
Money is on everyone’s mind in today’s tough economy
and research shows that it’s even changing behaviors.
- Did You Know?
- In November 2008, 44% of Americans ages 18 to 29 reported that
they were saving more than they had in the past.
- Struggling college students are opting to wait in food-pantry
lines, giving up soda, and forgoing driving their cars or eating
out—all in order to survive in today’s financial downturn.
As you’re counseling your students this year, help them understand
how they can make smarter choices with their student loans and with
their finances in general. Share the following tips with your students:
- Know What You Owe:
- Borrow only what you need—the less you borrow, the less
you’ll have to repay.
- Keep track of your federal student loan balances by visiting the
National Student Loan Data System at nslds.ed.gov
- Estimate your monthly loan payments now to help you manage your
debt and adjust your financial priorities—use a calculator
like the Account Payment Plan Estimator in the Borrowers section
of mygreatlakes.org
- Compare your monthly payments to your potential earnings—visit
bls.gov to find
the average annual income for your field of study
- Repayment Reminders:
- You pay the lowest amount of interest under the standard 10-year
repayment plan.
- There is no penalty to pre-pay your student loans so, if you’re
able, pay more than the minimum as often as you can—this will
save you interest in the long run.
- Choose the payment plan that is right for your situation—standard,
graduated, extended, income-sensitive, or income-based.
- Choose an alternative payment plan if you have cash flow problems
early on.
- Talk to your lender about changing plans at any time.
- Student Loan Tips:
- Sign up to make your monthly payment via automatic withdrawal
(ACH) instead of by check.
- Find out if your lender has a program that rewards you for paying
on time.
- Deduct all of the interest that you pay—explore the education
tax benefits that are available by visiting studentaid.org
or irs.gov (search
for Publication 970).
- Money-Saving Tips:
- Avoid money magnets, or items where the value doesn’t always
add up to what you spend, such as:
- Hefty car payments
- Rent for expensive apartments
- Designer clothes
- Premium cell phone or cable service
- Cut soda consumption from vending machines
- Eliminate lattes and cappuccinos
- Drink tap water
- Pack your lunch
- Watch your bank fees
Once students are ready to think about the big picture, advise them
that it’s smart to develop a spending plan. Here’s how:
- Set financial goals
- Short-term goals
- Long-term goals
- Identify income
- Identify expenses
A spending plan allows students to have control over their spending
and saving. When they have control, they have the money for the things
they need—and the ability to save for the things they want.
The spending plan allows them to know how much they spend and how
much they can afford.
All of these tips help students better manage their money, as well
as become better student loan borrowers—both of which are especially
important as they weather the current economy. For more information
on smart spending for students, please contact Scott Orris, your Great
Lakes marketing representative.
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