(Cover the slide) * Subsidized Stafford loans (interest does not start to accrue until graduation) * Covers up to $8,500 annually $65,000 total * Repayment begins six months after graduation * You have up to 25 years to repay (if loan is over $30,000) - Interest rate is now 8.25% * Unsubsidized Stafford loans (interest begins to accrue immediately) * Covers up to $18,500 annually $138,500 total * Other characteristics are the same as subsidized loan * Plus loan - Covers cost not covered by other sources of financial aid (books and living quarters) * Must start paying back 2 months after receiving, so make sure to have a plan for repayment in place * You have up to 25 years to repay (if loan is over $30,000) * Interest rate now 9%, this is higher than a subsidized or unsubsidized loan * Federal Perkins loan * Covers up to $6,000 annually $40,000 total * Repayment starts 9 months after graduation * Up to 10 years to repay * Interest rate now 5%
Understand that once you take out a student loan it does not go away until paid back. So choose wisely, identify your needs and choose the type of loan that best suits those needs. Have a payback plan in place. A student loan that is being repaid with timely payments can have a positive affect on your credit report, a student loan that has gone into default can have a negative affect on your credit report and subsequently your ability to buy a home or car in the future. The choice is yours.
The Two Faces of Credit Cards or Credit Cards Your Best Frienemy
Being able to apply and receive a credit card for many young Americans has become a right of passage into adulthood. Like many things that come with great power also comes great responsibility. If used correctly having a credit card can have a positive effect on your credit report and your credit rating. The problem is many people want to use the purchasing power afforded by credit cards, but do not want the responsibility of maintaining the payments. This is where many people get themselves into deep financial trouble. To protect your credit ratings and to secure your financial future:
(Cover the slide) * Limit number of credit cards you have -Credit cards are like boyfriends (or girlfriends) if you have more than one your just asking for trouble. * Shop around /Ask around
-Interest rates and services vary (interest rates can vary between 9% - 23%)
-Know what your getting into (read everything before signing) * Make payments on time
-Late payments hurt your credit score (and can cause your interest rates to rise)
-Payoff entire amount due monthly if possible (to avoid interest all together) Avoid cards that have an annual fee, always try to pay more than the minimum payment (you don’t want to pay double the amount borrowed). Remember credit cards are not free money use them wisely. Here’s Paula to talk to you about what to do if you should find yourself in outstanding debt.
If You Find Yourself in a Debt Hole, Stop Digging
Sometimes despite your best effort, you may find yourself in a debt trouble. If you take personal responsibility and start making changes in the way you handle your finances you can turn things around.
(cover slides) The first thing you can do to see where you stand is to: * Check Your Credit Report * Look for mistakes and/or fraud (contact credit reporting agency on how to handle problems, that information