Wednesday, September 17, 2014

OFF TO COLLEGE: Finding $s to Fund College Educations

A friend of mine who is in the financial planning and investment business sent out great information to his clients last week. The information points to programs, aid, grants and more that are available for financing college. Many of us are in the throws of getting someone in the family off to college. And many people are figuring out funding this year for next year college starts, I thought it timely to share the wealth of information that you will read below - from Joe Guittadaro, with his permission to share.

Federal and State College Financial Aid Programs
The cost of financing a college education can be daunting to many families. Although most colleges agree that the family should be the primary support vehicle, financial assistance does exist. In addition to private sources such as trade unions, fraternal or service organizations and professional associations, there are numerous state and federal aid programs available.

The good news is that a family does not have to be in a low-income bracket to qualify for many current aid programs. Most need-based programs take into account family living expenses, the number of children in the family and how many children are in college.

Federal Programs
The federal government administers several major financial assistance programs. Some are direct assistance programs; that is, the assistance goes directly to the student. Other programs are administered through the college that the student attends, funds are sent directly to the college, which in turn dispenses the money to the student in accordance with federal guidelines.

Pell, Academic Competitiveness, and National SMART Grants
The Pell Grant (formerly the Basic Educational Opportunity Grant Program) was named for Senator Claiborne Pell, who sponsored the legislation that established the program. A Pell Grant is based solely on financial need. The amount of the award is based on student need (within certain limits) and on how much money Congress appropriates to the program each year. It is important to apply for a Pell Grant even if you think you won’t qualify, since many college and state aid programs require it. Just check the proper box on the financial aid application.

The Academic Competitiveness Grant (ACG) provides need-based grants for the first two years of undergraduate study to full-time students. The National Science and Mathematics Access to Retain Talent (SMART) Grant is available during the third and fourth years of undergraduate study to full-time students who are majoring in physical, life, or computer sciences, mathematics, technology, or engineering or in a foreign language determined critical to national security. These two grants are for U.S. citizens who are eligible for the federal Pell Grant, and who have successfully completed a rigorous high school program, as determined by the state or local education agency and recognized by the Secretary of Education.

Stafford Student Loans
The Stafford Student Loan (formerly the Guaranteed Student Loan) is a federally subsidized loan program that allows the student to borrow from private lenders and the government at lower interest rates. Families with high incomes are eligible for the program if certain needs tests are satisfied. The loan is insured either by the federal government or a state agency.

Banks and other lending institutions voluntarily take part in the loan program. Repayment of principal and interest is deferred until six months after a student graduates or leaves school, and standard repayment is made over a 10- to 30-year period, depending upon the amount owed. An undergraduate may borrow up to certain limits each school year under the program. The government pays the interest for all undergraduate and graduate school years and for six months after the last class.

PLUS Loans for Undergraduates
PLUS loans are available to parents of dependent undergraduate students, and to graduate or professional students who reach their Stafford Loan limits. Repayment of a PLUS loan begins 60 days after parents receive the money, and lenders typically establish a repayment period of 10 to 25 years. Graduate students may defer payment while in school at least half-time.

Supplemental Education Opportunity Grant
A Supplemental Education Opportunity Grant (SEOG) is a grant to a student with demonstrated financial need. The money is sent by the federal government directly to the colleges, which determine the award amount and dispense the money to the students. (These are in addition to Pell Grants.) The Department of Education allocates a specific amount of money to each participating college. Once distributed, there are no additional sums. Applications are made through the academic institution’s office of financial aid. Early application is strongly recommended.

College Work-Study Program
The College Work-Study Program is a program administered by each participating college to provide employment for students who demonstrate financial need. The federal government grants funds to colleges for this purpose. Students normally obtain employment under this program as part of an overall financial aid package. They generally work 12 to 15 hours per week during school sessions, and up to 40 hours a week during vacation periods. Examples of college employment include library clerks, faculty aides, maintenance workers and cafeteria workers. The awards are determined by the colleges, and once a student has earned the full award amount, employment is terminated for that academic year.

Application is made through the college financial aid office. Eligibility is based solely on financial need. Students must be enrolled at least half-time in an accredited college and maintain good academic standing while employed. These earnings will not reduce the student’s financial aid eligibility, however funds are limited, so apply early.

The Perkins Loan
Perkins Loans (formerly National Direct Student Loans) are administered by colleges that also act as lenders. Eligibility is based on the student’s calculated need. Although the interest rate is low, funds are limited and students should submit the financial aid application early. A student will pay no interest while still in school. There is a nine-month grace period after leaving college. Repayment is stretched out over 10 years.

State Programs
State governments also offer a variety of assistance programs. But most state assistance is available only to state residents attending schools within that state. Some states do make exceptions and permit state residents to attend out-of-state schools. A few states allow nonresidents to receive assistance while attending a school within the state or have reciprocity arrangements with other states.

Many states have special programs for teachers and National Guard enlistees. Others offer work-study programs and special academic supplements. Application procedures vary from state to state. While most states allow the student to use one of the same need analysis application forms used by the federal programs, some states require separate application forms that must be completed for state programs. Students may find out about state programs and requirements through their high school guidance counselor, college financial aid office or a state agency.

It is important to begin early and thoroughly investigate all potential sources of financial aid. Your child’s college placement office can be a good starting point for information on financial aid sources.

This communication is not intended to be tax or legal advice and should not be treated as such. Each individual’s situation is different. You should contact your tax and/or legal professional to discuss your personal situation.

This article was prepared by Wealth Management Systems Inc. The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. We suggest that you discuss your specific situation with a qualified tax or legal advisor. Please consult me if you have any questions.

Because of the possibility of human or mechanical error by Wealth Management Systems Inc., or its sources, neither Wealth Management Systems Inc., nor its sources guarantees the accuracy, adequacy, completeness or availability of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. In no event shall Wealth Management Systems Inc. be liable for any indirect, special or consequential damages in connection with subscribers’ or others’ use of the content.

 ~ Marianne 408-295-6656 ~

Tracking #1-302800

Joe Guttadauro, MBA
SAN JOSE, CA 95125

Wednesday, September 10, 2014

Review, Renew, and Refurbish

Several years ago, I read that September was the busiest month of the year for events, trade shows, major workshops and more. Perhaps we never lose the sense of going back to school in the Fall and wanting to be learning and expanding ourselves.

With that in mind, it's a good time to "Review" ourselves and our careers. If you are feeling "blah" about your job or know that some aspects aren't working for you, take a look at your career priorities, Do you want more flexibility at work? Perhaps, you are hoping for a new project  that will engage you and challenge you. Lately, have you been thinking of starting your own business, or changing industries or professions? This is your "Review" time. List all the priorities you need to be most satisfied in the work that you do. Then, weight each one's level of importance to you. Your priorities may have changed and it's important to understand that. Your new list will give you an objective view of how your job is currently meeting your work life criteria. If it is, celebrate! If not, continue down the path of change and make a career adjustment.

Next, take time to "Renew" yourself. Sign up for a class that will expand your technical knowledge or increase your effectiveness at work. Find out how to start your own business. See a career counselor to support career change. Read a book that will help you evaluate your career interests, talents, skills and goals. Here's a link to the top 10 books to assist with career change that I highly recommend.
Also, doing something creative or fun or  taking a day off or a drive through the mountains are all ways of renewing and gaining a new perspective that will help guide you through this process.

Thirdly, "Refurbish" your resume. Even if you don't know your exact next target, you can create a resume template that you can build on later.  Creating or refurbishing your resume is a very positive experience. You focus on what talents and strengths you have and the accomplishments about which you are most proud. Working on your resume with a career counselor will build your confidence and help steer your professional direction whether it's down the same path or a completely new one.
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If you are in a situation where you need assistance in getting into that right job or getting back into a role that makes you happy,  I'd love to assist. *

Marianne   408-295-6656  
* I do sliding scale for those who need that assistance.