5 Simple Ways To Cut Corners So You Can Retire Young
Here are some ideas to cut a few corners and save more without having to feel like you’re making an extreme change.
Source: Forbes
What’s Next for Simplifying the FAFSA?
Last year, a new bill was proposed by Congressional Democrats that sought to further simplify the process surrounding the Free Application for Federal Student Aid, better known as the FAFSA. The bill – had it been passed – would have allowed students and their families to file the FAFSA just once during their college career in order to qualify for financial aid.
Though the bill did not pass, it did inspire some change on both sides of the aisle. However, wanting change is not the same as enacting change. As always, it’s hard to agree on what should be done to simplify the FAFSA.
So what are the options on the table now? TIME highlights them:
1. Different “pathways” through the FAFSA.
There is no “one-size-fits-all” on the FAFSA; that’s why there are 130 questions. Each question hopes to gauge a family’s financial circumstances, and some families require more questions than others. However, according to TIME, only 1 to 2% of families require all 130 questions.
That’s why there are groups that are advocating for a smarter online FAFSA. Rather than fill out all 130 questions, families would only be required to fill out the questions that applied to them. TIME estimates that based on a few factors, most families would only have to answer 30 – 40 questions – versus 130.
2. The postcard approach.
Researchers from Columbia University, economist Judith Scott-Clayton, and University of Michigan, economics professor Susan Dynarski, told TIME that expected family contribution is based on three things: adjusted gross income, family size and number of family members in college at the same time.
With that, students only “need” to answer three questions, which could easily fit onto a postcard. Two years ago, two senators – a Republican and a Democrat – proposed that idea. Though it didn’t get far in Congress, one of the senators plans to put it at the top of his priority list this year.
3. File it once – forever.
According to an interview in TIME with Brett Benner, the director of enrollment management at the University of Tampa, only 6% of their students actually make changes to their FAFSA throughout college. So why not file the FAFSA once – and then refile only if needed?
That’s the final solution on the plate for making the FAFSA simpler and more effective, which is actually vital to not only helping students apply to college but stay in college too. TIME states that “research has found that students who file a Free Application for Federal Financial Aid or (FAFSA) are more likely to enroll and stay in college. But more than half of high school seniors don’t fill out a FAFSA by the time they graduate, according to federal education statistics.”
A simplified FAFSA will go a long way toward guaranteeing greater college success for students – and we’ll be the first to update you as changes are made.
Source: Fastweb
Why The Traditional 401(k) Is Underrated
Let’s take a look at some reasons why you might want to contribute to a traditional 401(k) even if you don’t like paying “hefty tax bills:”
Source: Forbes
Billion in Student Loans to Be Possibly Discharged
Christmas has come early for a few thousand borrowers. According to The New York Times, billions of dollars in loans may be up for dismissal because critical paperwork is missing. It’s the best possible outcome for student borrowers – so who is it affecting and why?
The details:
*Information compiled from Forbes and The New York Times.
It should be noted that National Collegiate Student Loan Trust is owning up to the issue. Donald Uderitz, the founder of Vantage Capital Group that is the owner of National Collegiate’s trusts, told The New York Times that he isn’t happy with the situation. “We don’t like what’s going on. We don’t want National Collegiate to be the poster boy of bad practices in student loan collections, but we have no ability to affect it except through this litigation,” Uderitz said in an interview.
Essentially, there is nothing National Collegiate Student Loan Trust can do except go to court with borrowers who have defaulted. At this point, THAT is the solution.
With $5 billion on the line as well as the possibility of student loan dismissal, many borrowers are wondering if the situation applies to them and what they can do about it. Unfortunately, the answer is nothing.
Currently, the issue is only affecting those borrowers who have defaulted on their student loans with National Collegiate Student Loan Trust. Many of these borrowers have entered into delinquency and are being taken to court by the Trust. It is through these court cases that they are learning that the student loans aren’t technically owned by anyone because papers proving ownership have gone missing.
And if you’re thinking that you could just default on your student loans in order to have them forgiven (in a very roundabout way), stop right there. Student loan default goes into effect after 270 days of missed payments, which means a huge increase in the total amount you owe.
If your student loans are owned by a private lender, like National Collegiate Student Loan Trust, they can take you to court. Though the end result may be dismissal of your student loan debt, there is still a costly battle to get to that point. In addition to accruing legal fees, you also have to show up to every court date, be there on time and not miss any deadlines. Not doing so could result in a win for National Collegiate, which means paying the entire loan amount, accrued interest and delinquency fees.
If, by chance, you’re one of the lucky thousands that have defaulted student loans with National Collegiate Student Loan Trust, accept the challenge in court and commit to making it your top priority. You may just walk away with your student loans eliminated.
Source: Fastweb
Not On Track For Retirement? 5 Steps To Get There
You can retire no matter how late you start, but it will require sacrifice and saying “no” to a lot of things so you can say “yes” to retirement.
Source: Forbes
When Your Retirement Savings Are Off To A Late Start
Every dollar we can save now is a dollar we won’t have to scrounge up later, when we are perhaps well past our prime scrounging years. Below and in no particular order are some of the retirement back-up strategies I have explored and discussed with clients and colleagues over the years:
Source: Forbes
How To Buy A House In An Expensive Area
How do you save enough for a home down payment when you are already paying very high rent as a percentage of your income? It can be done, but it’s not likely to happen the traditional way.
Source: Forbes
The Talk You And Your Spouse Need To Have About Retirement
I encourage you to set aside time with your spouse, undistracted, to walk through the following questions that if not addressed, can be retirement income budget busters:
Source: Forbes
Tuition Insurance: Do or Don’t
Like most big life purchases, your college education is eligible for insurance, but it’s likely something you’ve either never thought of or knew existed. So when it comes time to start college, is tuition insurance worth it?
Let’s start with the basics: what is tuition insurance?
Tuition insurance provides a full or partial refund on tuition if you have to dropout or take a break from school. Coverage includes tuition, fees, room and board. However, you’re only covered under certain circumstances. You can’t just take a break because you’re tired of the homework; there has to be a legitimate reason.
Typically, tuition insurance covers leaving school for a medical reason, like a physical or mental illness. Other plans may include illness or death of a family member, a pre-existing condition like Crohn’s or asthma as well as if you simply have a change of heart.
Tuition insurance is purchased before the start of each semester. Just as plans range in coverage, they also range in price depending on how much of the cost you want to cover.
Now – the million dollar question (or literally half a million dollar question depending on where you attend school) – is tuition insurance something you need?
If you have a pre-existing medical condition or have experienced depression or anxiety in the past, you should definitely look into tuition insurance. If it’s also worth the cost to have peace of mind, tuition insurance is not very expensive in the grand scheme of college costs. However, most college-age students are in excellent health and won’t encounter a health emergency over the course of their college career.
At the end of the day, you could be paying as little as $30 to guarantee that you will never lose thousands of dollars in the event of a medical or family emergency if you have to withdraw for a semester. If tuition insurance seems like the right thing for you to invest in, contact your college to ask which providers they recommend. From there, signing up for tuition insurance is simple.
Source: Fastweb
7 Steps To Declaring Your Financial Independence Day
Now that we’ve all celebrated our country’s Independence Day, it’s time to think about when you can declare your own independence, not politically but financially. In other words, when will you be independent from having to work for a living?
Source: Forbes
Why You Shouldn't Be So Obsessed With Your Credit Score
Having a high income and a lot of money in the bank doesn’t a good credit score make (in fact, neither of those factors affect your score at all), but concentrating on keeping more of the income you make and paying back more of what you owe is bound to help you achieve financial freedom.
Source: Forbes
