Managing Your Money and Debts Wisely

PROSPER

Learning how to manage your finances and debts is one of the most important lessons you learn.

YOUR MONEY, YOUR FUTURE, YOUR LIFE

Preparing for the Future now:Practice delayed gratification

Take a personal finance course ASAPIf you plan on operating a business, take

accounting and tax law coursesSave your change every day

Write down everything you spendApply for every type of financial aid

DISCIPLINE AT THE RIGHT TIME

Federal and State Loans- Must be repaid with interest usually 6 months after graduation.

Federal and State Grants- Need based awards given on a 1st come, 1st serve basis. DO NOT HAVE TO BE REPAID! Scholarships- merit based. DO NOT HAVE TO BE

REPAID! Work Study Programs: Money earned while working on

campus. DO NOT HAVE TO BE REPAID!

http://www.fafsa.ed.gov

FINANCIAL AID

Complete FAFSA or TASFA Don’t miss deadlines Read all instructions

Submit documentation, if required Never lie about your financial status

Begin applications ASAP Talk to financial aid counselors at your school

Take fliers & brochures Apply for admissions

Find out if you can file electronically Keep copies of tax returns for each year

Apply for everything possible!

TIPS FOR APPLYING FOR FINANCIAL AID

Money that you HAVE to pay back!

If you borrow money, borrow only enough for books, tuition and supplies.

“…don’t borrow any money you don’t absolutely need.”

STUDENTS LOANS

Apply for financial aid & scholarships before thinking of getting a loan

HELPFUL TIP

Determines if you get approved for a mortgage, insurance, credit card, etc.

If approved: your credit score determines what rate of interest you will have to pay

1 free credit score a year – www.anualcreditreport.com

YOUR CREDIT HISTORY

Fair Issac Corporation – Company that created the widely used credit model

Your credit score is referred to as a FCIO score

FCIO score – 300 to 850

A good score can be consider 720 or above

WHAT IS FCIO?

Equifax:

www.equifax.com 1-800-685-1111

Experian:

www.experian.com 1-800-397-3742

TransUnion:

www.transunion.com 1-800-888-4213

3 MAJOR CREDIT REPORTING AGENCIES

A step forward for financial security is knowing how much money you have and exactly how you spend it.

Budgeting is good to determine the exact amount of money you need to borrow

Deciding how much to borrow will affect your lifelong after you have completed your degree

BUDGETING

Credit card debt is the most common among college students.

76% of undergraduate college students have at least 1 credit card and an average balance of $2, 500 (Nelly Mae

study 2010) You lose track of how much you’re spending

CREDIT CARDS: LIVING ON BORROWED MONEY

Over the top credit card marketing Terrible credit card terms & conditions

Economy that no longer provides well paying jobs Interest adds up!

CREDIT CARD DEBT IS DUE TO:

Unsuspecting customers have been duped into signing car title loans, pay day loans, and rent-to-own contracts

Worse than credit card debt

THE PITFALLS OF PAYDAY LOANS, CAR TITLE LOANS, & RENT-TO-OWN

CONTRACTS

When someone is on a tight budget, they give up some conveniences to save more money

Little things, such as daily coffee for S3.50 or fast food, can add up!

Ten year plan: causes of money drain are gum, bottled water, eating out daily, ending machine snacks, unused

memberships, salon visits, cigarettes

SMALL COSTS ADD UP!