UNL Student
Money Management
Center
Money Smart
Introduction
Erin Wirth, Accredited Financial Counselor
Peer Money Coaches
Dr. Kathy Prochaska-Cue, Program Advisor
Ph.D., Accredited Financial Counselor, Extension Family Economist
Outstanding Planning
Education & Financial
Counseling Center
Building a
Financial Education Brand &
Marketing Communications
Why Are We Here?
• Committed to encouraging students
to take responsibility for their
financial futures
• Students to build good
relationships with money
• Students have confidence in
their financial futures
• Are able to meet their
financial goals
• Creating and upholding a culture of
financial empowerment among the
student body through financial
education
Personalized Money Management Sessions
• One-on-One Money Management
Coaching Sessions
With an Accredited Financial Counselor or
Peer Money Coach, a UNL Student
Common Session Topics:
* Spending Plans
* Financial Goals
* Organizing Finances
* Establishing Credit
* Saving Money
* Debt Repayment
* Investment Education
* Understanding Financial Aid
* Selecting Employee Benefits
* Major Purchases
Introduction
Purpose:
• To inform you how we answer your students’ financial
questions.
• To give you some reminders about financial education
so if your students come to you with financial questions,
you’ll be prepared.
The 6 $$$ Questions We Get
Asked Most by
UNL Freshmen
Stories from UNL Parents
Remember:
• You are a great educational
resource for your students
• By talking about your financial
mistakes, you can help prevent
your student from making the
same mistakes
• Know financial mistakes don’t
mean you raked up huge debt
or foolishly spent your money
• NOT getting basic financial
education is a mistake!
#1 UNL Freshman FAQs
It’s always in the media that students
are in lots of debt. How can I minimize
my debt load?
Checklist for Minimizing Debt
• EVERY YEAR!
Complete the Free Application for Federal
Student Aid at: http://www.fafsa.ed.gov/
* Will need parents tax information
* Can use IRS data retrieval process
* Do this close to Jan. 1st
Some need is first-come, first-serve
• UNL Will Inform You What You Qualify For
Will be listed at: https://myred.nebraska.edu
• Understand How Many Grants & Scholarships
You Are Getting
Financial aid you DO NOT pay back
• ONLY BORROW WHAT YOU NEED!
UNL Costs
Costs
Resident
Non-Resident
Credit Hour
$216
$660.25
Business
$268
$817.25
Engineering
$309.50
$860
Architecture
$292
$844
Fees Per Class
$11.35
$11.35
Programs &
Facilities Fees
(per semester)
$557
$557
Checklist for Minimizing Debt
• Look At SUBSIDIZED Loans = 3.86% AND
Perkins Loans = 5%
Student DOES NOT pay interest while in
school or during 6-month grace period
• Then Look At UNSUBSIDIZED Loans = 3.86%
The loans that DO accrue interest while
you’re in school
• Consider Parent PLUS Loans 6.41% &
Private Loans
However, know the disadvantages of these
loans
Checklist for Minimizing Debt
Federal Loans
Private Loans
• Low, fixed interest rates
• Historically, higher interest rates
• 6-month grace period during which
no payments are due
• Repayment period differs
• Income-based repayment options
• Not as much choice of repayment
options
• Ways to lower or postpone
payments
• Usually not way to lower or
postpone payments
• Loan forgiveness programs
(teachers, public service workers)
• No forgiveness programs
• Deferment options, especially if you
return to school
• Usually no deferment options
FAFSA FAQs
How Child Assets are Assessed
• Assets listed under the student’s name are
weighed at 20% of their value when calculating the
expected family contribution (EFC)
• Parent’s Assets - weighed at 2.6%- 5.6% of their
value (based on a sliding income scale and after
certain allowances)
FAFSA FAQs
Taking Retirement Funds Distributions
• Retirement funds are sheltered from the need analysis
process
• If you withdraw funds before the financial aid
application is filed, you will have converted those funds
into an included asset
Common FAFSA Mistakes
• Incorrectly filing income taxes as head of household
If there is an error in the head of household filing
status, you’ll need an amended tax return
• Listing parent marital status incorrectly
If the custodial parent has remarried, you'll need the
stepparent's information as well
• Failing to count the student as a member of the
household
• Including retirement assets on the FAFSA
• Inflating parents’ education
If parents didn't graduate from college, select "high
school" as the highest education attainment
Best Student Loan Tips:
Student Loan Cancellation Programs
Public Service Loan Forgiveness Program
• The borrower must be employed full-time in
a public service job for 10 years
• Cancellation of the remaining balance due
on eligible federal student loans after the
borrower has made 120 monthly payments
under the Income-Based Repayment Plan
Best Student Loan Tips:
Student Loan Cancellation Programs
Public Service Loan Forgiveness Program
• Emergency management
• Government
• Military service
• Public safety & law enforcement (police and fire)
• Public health
• Public education
• Early childhood education
• Social work in a family service agency
• Public services for individuals with disabilities or
the elderly
• Public interest legal services
• Public librarians
• School librarians
Student Loan Fees
• Deducted proportionately from each loan
disbursement you receive
• You're responsible for repaying the entire
amount you borrowed and not just the
amount you received
Here are the current loan fees for federal
student loans:
• 1.051% for Direct Subsidized Loans and
Direct Unsubsidized Loans
• 4.204% for Direct PLUS Loans for parents
and graduate and professional students
• There are no loan fees for Perkins Loans
#2 UNL Freshman FAQs
So, if I don’t want to be in debt forever,
how much financial aid should I take
out?
Expert Guidelines for Debt Load
• No more than 10%-15% of the expected
monthly income from your first job going
for repayment of all loans
• Over 15% means you probably won’t be
able to afford car payments
• 20% is the start of the "danger zone"
when loan debt is out of control
Guidelines
Using Your Monthly Gross Salary When You Graduate
We Recommend - Debt Payments = 10%
Accounting
Nutritionist
Elementary Teacher
Salary = $39,062
Salary = $29,347
Salary = $33,765
Max to Borrow =
$28,314
Max to Borrow =
$21,217
Max to Borrow =
$24,476
Financial Picture of Typical UNL Graduate
Average Amount of Student
Loan Debt
$ 21,000
Interest
3.86%
Plan
Length
Monthly
Interest
Standard
10 years
$211
$4,346
Extended
25 years
Only available for over $30,000
Graduated
10 years
$118
Income-Contingent
Payments are calculated each year and are based on adjusted
gross income, family size, and the total amount of loans – Your
payments change as your income changes
Income-Based
Maximum monthly payments will be 15 percent of discretionary
income, the difference between adjusted gross income and 150
percent of the poverty guideline for family size and state
Pay as You Earn
Maximum monthly payments will be 10 percent of discretionary
income, the difference between adjusted gross income and 150
percent of the poverty guideline for family size and state
$5,419
Tips for Reducing Amount Borrowed
Avoid Student Bill Late Fees
• Due the 12th of every month
• Bill emailed on 25th of every month
• Use electronic check option
Credit costs you!
• NOTE: Your student DOES have to give
you permission to access their MyRed
Account.
• Use Campus Services
UNL student fees pay for them
Examples: Lied Center discounts, UPC Programming
Tips for Reducing Amount Borrowed
Never Stop Applying for Scholarships
• UNL General Scholarship Form
On MyRED - Due February
• Individual Colleges - CBA, Arts & Sciences
• Private – Fastweb.com
Get a Part-Time Job with Education Benefits
Some employers, Americorps, ROTC
Lower Interest Payments
If you have the money, make interest payments
on unsubsidized loans while you’re still in
school
Mistakes Students Make
VERY COMMON:
Not Knowing How Much They’ve Borrowed
Ex. One student had $60,000, thought had $25,000
TRACK AT: unl.edu/smmc
Know Some Scholarships are Taxable
• Tax Free = Tuition & fees
• Taxable = Room & board, travel, research
Reduce Expenses
Creating a spending plan is a great way to discover ways to
free up money that can be put towards education expenses
Mistakes Students Make
• If student receives more in student
loans, grants, and scholarships than they
have to pay in to UNL
• Extra is deposited in the bank account
you set up in MyRed
• They should know it’s important to:
SAVE IT!
- In a savings account
- Only transfer over when they need it
#3 UNL Freshman FAQs
Do I need to have my taxes done?
Tips for Students & Taxes
• Discuss if You are Claiming the Student
Person is under 19 years old or is under 24 and a full-time
student AND the taxpayer provided over half of their
support – You get deductions & credits
• If They Are a Dependent, Still File
If you earned more than $5,950, you must file a tax return
If you had income tax withheld from your pay, file
• Know the Current Education Credits
Ex. The American Opportunity Credit is a tax credit of up to
$2,500 of the cost of tuition, fees and course materials
paid during the taxable year
Tips for Students & Taxes
• Find on MyRed
Form 1098-T - Tuition Payments Statement
Includes Proof of Scholarships & Grants and Amounts
Billed
• Know Textbook Amounts
Textbook purchases can be applied to taxes for
educational tax credits
• Note: Students can get free tax help every year through
UNL VITA
#4 UNL Freshman FAQs
But how do I know how much money
I’ll need each year?
From Survey of Students:
Per Academic Year
Item
Amount
Parking permit
$ 400
Textbooks
1,000
Eating Out
$400 - $3,000+
Sport tickets
300
Laundry
320
Entertainment
Cellphone
630
$300 - $2,000+
School supplies
(printer ink)
250
Gas
300
Student organization/
Greek fees
300
TOTAL
Clothing/Personal Items
$ 3,500
$300 - $1,000+
Figuring Out How Much to Work
Example Real-Life Budget: Living in a 2 Bedroom with a Roommate
Rent = $325
Electricity = $50
Cable = $20
Internet = $20
Groceries = $165
Eating Out = $60
Clothing = $40
Laundry = $10
Toiletries = $40
Gas = $65
Entertainment = $50
Medical needs = $15
Renter’s insurance = $15
Car insurance = $45
Cell phone = $45
Total Cost Per Month = $965
Most students would need to work around 25 hours per
week to cover this cost – with taxes taken out.
Personalized Spending Plans
UNL Student: Leah Lives: On-Campus
Weekly budget after major expenses: $ 140
Day
Item
Monday
Gas
Groceries
(Choice: took the bus to East Campus)
Tuesday
Coffee
(Choice: skipped a concert with friends)
$ 4.50
Wednesday
Pop and candy bar
(Choice: took the bus to East Campus)
$ 2.50
Thursday
Movie
(Choice: Didn’t get popcorn and pop)
Friday
Dinner for friend’s birthday
(Choice: Didn’t order dessert)
$ 12
Saturday
Fast food lunch
Party
$6
$ 15
Sunday
Shopping – New Shirt
(Choice: Decided to pass on the $50 trendy shirt)
$ 30
TOTAL
Amount
$34
$ 21
$9
$ 134
Personalized Spending Plans
UNL Student: Sarah Lives: On-Campus
Budget after major expenses: No idea
Day
Item
Monday
Breakfast at gas station
Tuesday
Parking ticket
Ate out for lunch
Bought present for Mom
$ 30.00
$ 8.42
$ 23.00
Wednesday
Gas
Ate out for lunch
Rented movies at Blockbuster
Groceries
$ 28.23
$ 6.32
$ 8.96
$ 35.69
Thursday
Coffee
Yoga class
$ 5.50
$ 14.00
Friday
Takeout for dinner
Trip to Target for toiletries – Got clothing & candles also
$ 12.62
$ 62.00
Saturday
Movie & snack
$ 15.69
Sunday
Brunch with my parents
Laundry
TOTAL
Amount
$ 4.50
$ 0.00
$ 5.00
$ 259.93
Personalized Spending Plans
By having a plan and making good
choices, this week Leah spent:
$ 125.93
less than Sarah.
That adds up to:
$ 6,044.64 per year
Personalized Spending Plans
Mint.com
•
•
•
•
Get organized
Track expenses – Reduce expenses
Track income – Figure out reduce/increase income
Get help saving for financial goals
Good Habit: Creating Financial Goals
Why develop financial goals?
• Don’t Miss Out on Opportunities,
such as studying abroad
• Help Them Achieve Larger Life Goals
Buying a house, Buying a car, Going
to graduate school
• Control Spending
Without goals, daily spending on
unimportant things can keep
students from achieving the really
important things in life
Impulse Spending Tricks
Think about your financial goals –
Instead of spending, put money into savings
Take $20 out each week and only spend that
Plan for little purchases
Get 2 lattes a week instead of 5 and save:
$2,080 per year
Get 1 well-made new shirt once a month
instead of 3 cheap shirts and save:
$1,300 per year
Emergency Fund
Dave Ramsey recommends even college
students save for:
• Emergency Fund
(3 months living expenses, $500)
• Financial Goals
By Paying Yourself First
• Including savings in your budget
• Automatically having funds deposited
in your savings
• Building good habits
Dave Ramsey’s “Foundations in Personal Finance” Program
for College Students Available for FREE at UNL SMMC
#5 UNL Freshman FAQs
What are some other things that see
UNL students do to waste money?
Banking/Credit Union Fees
• Read the Account Contract!
• Some things many people don’t realize:
- Overdraft fees
(Ex. $35 per day for up to 4 items)
- Transfer fees
Fees if you transfer from savings to
checking too often
- ATM fees
Fees for using another bank’s ATM
- International transactions
(usually around 3%)
Not Having Adequate Insurance
Renter’s Insurance
• Ask your insurance agent if your family’s current
homeowners or renters insurance policy also protects
belongings in the dorm
• Most policies limit a student’s coverage to 10% of the
family’s coverage
• For example, if your family’s policy has a personal property
limit of $300,000, student belongings will be covered up to
$30,000, after the deductible
• In most cases, buying separate renters insurance is less
expensive than increasing the coverage limits on your
family’s homeowners insurance
Average = $150 per year
Car Expenses
Locksmiths = $200
Towing = $200
Solution = Triple AAA
Primary - $60
Family - $14
Think About
Cost of Car on Campus
Parking
$396
Oil changes $120
Gas
$720
Insurance
$600
Registration $150
TOTAL =
$1,986
Bus = FREE
Rent Zip Cars =
$75 membership fee
$7 per hour
Becoming a Victim to Identity Theft
Basic Tips:
• Copy the front & back of all credit and
debit cards and keep the copies in a safe
location
This enables you to cancel the card ASAP
• Keep credit/debit card receipts in a safe
place - If any transactions are in
question, call the card issuer
• Call it in ASAP
Credit Card - $50
Debit Card - $500
Moving Off Campus Without Research
Real Life Example
Per Month
On Campus
Double room
7 day meal plan
$1,059
Off Campus – 1 Bedroom
2 miles from campus – Does Cook
$1,089
Off Campus – 1 Bedroom
2 miles from campus – Doesn’t Cook
$1,339
Off Campus – 2 Bedroom
2 miles from campus – Does Cook
Off Campus – 2 Bedroom
2 miles from campus – Doesn’t Cook
$754
$1,004
• These are estimates. Actual figures will vary from student to student.
• Initial costs = $840 (with roommate, no furniture costs)
Rentping.com
Affordable, Quality Housing
Goal = $ 350
• Will need a roommate
• Stay within 5 miles from
campus
#5 UNL Freshman FAQs
Do I need a credit card?
Should Students Have Credit Cards?
Not Necessarily!
• If they want to have it in case of emergencies
(However, a cash emergency fund can work)
• If they understand the importance of credit
scores
• If they want to start building a credit score
Ex: If they want a mortgage or car loan when
they’re a Junior or Senior
Experts say:
Better to have no credit than to come away
from college with a ruined credit score!
Should Students Have Credit Cards?
Do you need a credit card?
740
If You Want a Credit Score
Predicts the risk that you will not pay your credit
obligations - Loans, credit cards, rent, etc.
Note: Many students wait till they are Sophomores
To borrow money
To rent an apartment
from banks or credit without having a
unions for auto loans, cosigner
business loans
To get your dream job
Many employers check
credit scores to determine if
you’re responsible
Should Students Have Credit Cards?
Most Important:
Understand their credit management habits will
affect their credit score & their financial future
People with low credit scores will pay more for:
• Health/Dental/Vision Insurance
• Car loans
• Car insurance
• Mortgages
• Rent
Low credit scores can prevent you from:
• Getting an apartment
• In some cases, getting a job
Should Students Have Credit Cards?
Credit Checks for SMMC Representative:
• Bank Teller
• Leasing Consultant for Apartment
Company
• Marketing Assistant for Retail
Management Company
• University Position
Characteristics of Good Credit Users
• Have the self discipline to live
within their means
• Are not impulse buyers
• Pay their bills in full each month to avoid
wasting money on interest
• Pay their bills on time –
#1 thing to do to build a credit score
• Only use 30% or less of credit available
• Don’t open too many accounts too quick –
Only have 1 or 2 and work on building a good
account history
How You Can Help
Help Them Understand the Characteristics
of a Good Credit Card
• Look for low APR
• If there are low “teaser” interest rates, know
what the rate will jump to after the period
• Know the grace period
• Read contact and know about fees
How You Can Help
• An optional tool to start teaching
students consequences, accountability, and
responsibility is an Ncard Campus Account
• Charges made to your NCard appear on the
Student Accounts Consolidated Bill
• $300 monthly limit
(does not include textbooks)
• Used at retailers around campus
• Can link to Wells Fargo account
Turns into a debit card
• DOES NOT BUILD CREDIT SCORES
Common Ncard Questions
• Pay bill on MyRed
• Can be used in dining halls, but if they
are on a meal plan, it does not charge
by meal
• Fast food restaurants ARE NOT part of
the meal plans
• Used for identification and to get into
buildings, including the Rec
• If lost, student must notify the NCard
office immediately
• Replacement card = $20
#6 UNL Freshman FAQs
What do I need to discuss with my
parents?
Good Discussion Topics
Mention:
• If you want your student to work & how much
(Experts recommend 10-20 hours per week)
• How UNL bills will be paid
Send student a check, put in student’s account, pay directly
• Details of health, renters, and auto insurance
• Saving student loan refund check
• Wise credit use – Only buy what you can afford
• Identity theft – Call in lost cards ASAP
• Be careful with overusing NCard
Talking to Your Children About Money
Keep Advice to a Minimum
• Rely on the example you’ve
set for the past 18 years
• But let your student know
they can come to you with a
problem