Unpaid Internships – How to Save

By: Raysha Duncan Purdue University Student and Peer Counselor

A lot of colleges at Purdue University emphasis the importance of internships, graduating with working experience, and how the experience will help sell YOU even more to future employers. Unpaid internships pay very little, are a growing trend in today’s economic environment, and can be one of the toughest truths to face about finding a killer internship. Not everyone will be able to find their dream internship and get paid for it.

It’s important to know when starting an unpaid internship that “unpaid interns cannot do any work that contributes to a company’s operations”; these internships are meant to be educational for the intern and are not meant to provide free labor for businesses. Financially, there are a lot of things to take into consideration when pursuing an internship: pay, cost of living, cost of transportation, potential moving costs, subletting your current place, validity of the internship… The list goes on and on. Looking at a huge list of to-dos can seem overwhelming and can make you question whether or not the internship is even worth it. But, luckily, if you give yourself enough time to plan ahead, finding the right internship is a breeze.

The simplest solution to your internship dilemma would be to find a local, or fairly local, company that is flexible enough and willing to fit the internship within your schedule. In this case, you won’t have to search for new housing or sublet your old housing or anything of that nature. This is an ideal internship situation from a financial standpoint. You may not be able to find your dream internship this way (commuting to New York City every week from West Lafayette Indiana is kind of impossible) but, you could still get a great internship, gain experience, and start to learn the ways of your trade, all while saving some money.

Another solution would be to start planning now for next year. This is necessary from a financial standpoint, especially if you know that your dream internship will not pay well. Saving is the most important step in preparing for an internship. Work a lot now and save what you earn in order to afford your dream internship. While flipping burgers or ringing up customers may not be what you want to do for the rest of your life, you can earn money while doing it and you can pick up extra shifts to score some spare cash.

You’ll also want to figure out your housing situation. If you’re renting now and your lease is continuing while you’re away, are you allowed to sublease? If you are, you should want to start advertising as soon as possible so you can line up your own housing near your internship. Also, if you have classmates who will be interning near the same location sharing a place can make rent more affordable and save you more money. You may have to start cutting corners during the school year to save, but it will all be worth it when you finally get to your dream company and start gaining real word experience.

A third solution would be to find an internship near your hometown. You’ll be home with your parents, but so what? You could live rent-free, have lessened commuting expenses, and still gain experience in a new position. However, finding an internship could be difficult to impossible depending on where you are from.

Lastly, there are virtual internships which are becoming increasingly popular and possible in today’s technological work force. These types of internships allow you to work from anywhere; you never have to set foot in the real office. Virtual internships allow students to work for a company from wherever. Because of advancements in technology, virtual internships are becoming more common and more practical.

Gaining experience in the work force and in your area of study is really important especially if you want real world working experience when you graduate with your degree, but it shouldn’t strain your wallet, either. Planning ahead, like with most things, can help save you a lot of stress and also a lot of money.

The process of even finding an internship can be difficult. Luckily, Purdue has a lot of great resources to help students as they search for internships.

The Purdue Center for Career Opportunities has a list of different categories of internships.  The CCO is also a great resource in preparing for career fairs, writing resumes, and practicing interviewing skills.

Interns for Indiana works to provide students with opportunities in high-tech areas located in Indiana.

Purdue offers jobs and internship opportunities to students here on campus.

Good luck on your internship search!

Which Private Alternative Loan is Right for You?

By: Leo Hertling Associate Direct Financial Aid Services and Operations, Purdue University

As we progress through the semester, some students are getting a bill asking for the next payment on tuition or for a payment in full.  This financial headache on top of living expenses, cell phone bills, etc.  When there isn’t enough in your checking or savings account to pay off everyone that you owe, how will you make it through the semester without working a full-time job and going to school full-time?  Oh and you have to maintain at least a 2.0 cumulative grade point all at the same time.

Before you begin looking at private loans, you should consider exhausting all of your federal eligibility for grants and loans. If you have not exhausted your federal eligibility or do not know what your federal eligibility is, you may want to contact your institution’s Department of Financial Aid. If you have fully maximized your ability for aid with the Federal and state assistance programs, and still have a sizeable balance due, then you may need to consider the use of a private alternative loan.  But which one is right for you?

If you search the internet for Private Alternative Loan, you will get about 4.5 million hits on Google in a little under ½ second.  I don’t know about you, but I don’t have the time to look at all those pages to see what is out there.  Not to mention that I have no idea who is reputable and who is not.  So how can you tell what lender to choose to satisfy your needs?

Let’s go back to basics:  Who does your family bank with?  What lenders do you know and trust?  Are there lenders that you don’t trust?

If none of the banks your family works with have a private student loan program, you may want to take a look at some of the online resources for lists of student loan lenders.  Purdue offers a list of lenders that our students have used in the past.  You can also receive a list of national private student loan lenders from finaid.org.

Why choose a private loan?

Private loans may be a financial alternative after all other sources of aid have been explored and found to be lacking.  If you find yourself in a situation where you are unable to cover the rest of tuition, living expenses, are unable purchase educational supplies, and borrowing is not possible through a Parent or Graduate PLUS loan, then a private student loan may be right for you. There are times when a private loan may have a lower interest rate than the current Parent or Graduate PLUS loan options.  Usually these loans have variable interest rates.  Be sure to review the borrowing conditions of the loan to determine the amount of variability in interest rates over time.  With variable interest a loan can start low and affordable, but the interest rate could increase significantly making payments unaffordable in the future.  A loan of this sort could adversely affect your future and wreak havoc on your finances.

A private loan may be the proper route for you to follow if you have been denied federal assistance due to a lack of progress toward your degree.  Many private lenders will funds to you regardless of how well you are currently doing in school.

Things to look at before choosing:

A private loan is in your name (and your co-signers name) solely and does not have a guarantor backing the loan; this is different from your Federal student loans.   In most cases, lenders tend to be conservative business men and women who like the idea of being paid back the money they loaned you.  If you default on the note, the lender will be left holding the note, with no recourse but to try to collect the money from you or your estate. Unlike other loans, educational loans cannot be dismissed in bankruptcy litigation. As a result, most lenders require a student with limited credit history to obtain a co-signer before they are considered for a private loan.  Your co-signer should be someone with a good credit history; this way, if something happens to you, they have someone to go to when trying to collect on the promissory note.   Even if you have very good or well established credit, you may want to consider using a co-signer for you loan.  Often lenders will give a lower interest rate or better terms simply because you applied with a co-signer.  Be sure to discuss lending options with your cosigner, they should have an equal say as to whom the loan is borrowed through since, in essence, they are borrowing the loan too.

Processing time from the start of the loan application to the disbursement of the loan also needs to be considered when investigating private loans.  The borrower needs to stay on top of communication between themselves, the lender, the co-borrower, and the institution they are attending.  It may take as long as 5 weeks to get the private loan in place at your institution.  By immediately responding to any queries sent to you by your lender, you may be able to cut this down to 2 weeks, but it will still not be faster than borrowing through the federal loan program. If you know you will need a private loan, the best practice is to apply early, finish all required steps by your lender, and keep the institution you are attending informed of where you are in the private loan process.

When choosing a lender, you will want to look at the terms and conditions of the loan.  The terms and conditions spell out the basics of a loan such as:  interest rates, origination fees, and repayment terms. Find multiple trusted lenders that offer private loans and compare the terms and conditions of each lender. Many lenders have multiple private student loans; find the one that best fits your need. 

Most loans will have a variable interest rate but there are a few with a fixed rate.  If you choose to take a loan with a fixed rate, you may have a rate that is much higher than if you had selected a loan with a variable rate.  On the other hand, if you select a variable rate loan, your interest rate may be lower than the fixed rate, either at first or for the entire repayment period depending on the economy.  The interest of a variable rate loan will be based upon a set variable like the current Prime (WSJ Prime 3.25%) or Libor (.78%) rate plus a margin.  The margin will vary from +0% to as high as the lender feels is necessary to adequately cover its risk exposure.   The better the credit of you and your co-signer, the lower the margin will tend to be.   The margin will remain in place for the life of the loan while base variable will go up and down as interest rates go up and down in the economy.  Review the terms and conditions of the loan you are considering to review the variables you may be facing.  Also look to see how often the interest rate will be recalculated and if there is an interest rate cap of any sort.

Origination fees:

Origination fees are fees that are assessed; you pay them, but never see the money.  A front end origination fee is where the lender takes a portion of the loan, a set percentage as defined in your terms and conditions, off the top.  A lender with a 2% origination would take $2 for every $100 borrowed.   The problem is that if you need $100 you need to borrow $103.  Some lenders will offer you a lower interest rate in return for paying an origination fee.

Term of the loan: 

The term of the loan is the period over which you will pay the loan back.  When does it begin?  Are you expected to make payments while you are in school?  Some lenders expect you to repay the interest on the loan even while you are in school or at least make a monthly token payment to assist in covering the interest that is accruing.   Other lenders would not require you to make any payment until you enter repayment.  Federal government student loans will normally be amortized over 10 years.  This will not be the case for your private loans.  Many of them have a repayment period of 15 to as much as 25 years.  While this sounds great remember the longer the period the greater the amount of interest.  It may make it easier on your monthly pocketbook to take a longer repayment but you may wind up paying 2 -3 times as much over the life of the loan.  You will also want to review the terms of the loan to see if there is an early repayment clause.  You can forecast the cost of your debt by using PayBackSmarter’s online calculator.

Borrower benefits: 

Does the lender give you an interest rate discount because you have an account with them?   Do they offer a benefit if you sign up for auto-debit where the loan will be automatically drafted from your bank account on the same day every month?   Some lenders will offer a discount if you let them do this.

Ultimately, it comes down to choosing the loan that makes the most sense to you and your co-signer given your projected income and possible income growth.

Have more questions about whether borrowing a private / alternative loan or whether it is the right option for you?  Please feel free to contact the MyMoney at Purdue team at mymoney@purdue.edu or (765)494-5050 for more help. 

Using Your Credit Report to Dispute Old Debt

reviewing credit report

Your credit report is supposed to tell a lot about your financial background, but it may be saying too much.

Most negative financial information should not remain on your credit report indefinitely. The Fair Credit Reporting Act requires credit bureaus to remove most instances of debt after seven years.

If you are unsure of what your credit report looks like, you can go to annualcreditreport.com to get a free copy from each credit agency (Equifax, Experian and TransUnion). If you find that debt from over seven years ago is still present on any of your credit reports, disputing the obsolete debt with one of the credit agencies may help to remove the information and should help your credit score.

When looking over your credit reports, you may also find incorrect information like debt that isn’t even yours; this, too, can be disputed and corrected.

Steps to Remove Old Debt from Your Credit Report

1. Obtain All Three of Your Credit Reports. Request a copy of your credit report from each of the three credit reporting agencies to confirm all information is correct and consistent. Old debt may show up on one of your credit reports and not the others.
2. Confirm that it Has Been Over Seven Years. Calculate the time between the date the account was charged off (as uncollectible) and the current date. Keep in mind that an account is not charged off until you have failed to make a payment for 180 days. This means that a debt must be 7 years and 180 days old before you can dispute it and consider it obsolete.
3. Contact the Credit Bureau. After you find your three credit reports, one or more of them will contain the credit bureau that listed your debt. Your credit report will include contact information for the credit bureau. There are also dispute forms available online that will help quicken the process. When you dispute an old debt, the credit bureau will ask the creditor reporting it to verify. If it can’t, the debt will be removed from your credit report.
4. Contact the Reporting Creditor. It doesn’t hurt to send the same information that you sent to the credit bureau to the reporting creditor directly. This may help speed up the process.
5. Follow Up. To keep your file on the top of the pile, call to follow-up a few weeks after you send your first form of communication.

Disputing Debts that Aren’t Yours

It can be frustrating to receive a phone call from a collection agency trying to collect a debt that is not yours, but worse, it can damage your credit. If this has happened to you, these steps can help:

1. Check Your Credit Report. If you find incorrect information, follow the dispute process detailed on your credit report.
2. Talk to the Debt Collector. No one can correct the mistake if the mistake has not been pointed out, and the faster you point out the mistake, the faster it can be resolved.
3. Write a Letter to the Debt Collector. It is best to send your dispute in writing even after speaking over the telephone, for documentation. In the letter, note the date, time and person you spoke with on the phone and what was said, and explain your dispute in as much detail as possible.
4. Know Your Rights. According to the Federal Trade Commission, a debt collector cannot keep contacting you after you’ve sent a letter disputing the debt. If you keep receiving phone calls and think you are being harassed, you can file a complaint at http://www.ftc.gov/.
5. Never Pay a Debt that is Not Yours. Once you make a payment, you are assuming responsibility for the debt, and no matter how large the debt is, it will still count against you.

The best way to make sure your credit report isn’t selling you out is to stay up to date with your credit history. Take advantage of the free annual credit reports, and stay informed. If you spot an error, work to get it fixed immediately.

Bio: This is article was provided by debt.org, America’s debt help organization. Debt.org educates students and parents on how to get out of debt.

Should I file my own taxes?

By Kimberli Youngblood Report Writer, Data Support Specialist, Purdue Alumni

cartoon man with briefcase flowing of money

This is a question all taxpayers have faced at one time or another.  The dreary thought of the men in black suits showing up at your door to collect taxes drives people to complete their taxes.  I imagine most have heard their elders say that there were two sure things in life: taxes and death.  Regardless though, we still are left each year with the question of whether we should file our own taxes or use a professional tax preparation service.

Over twenty years ago, an option to purchase your own software that would be updated on the new federal tax laws did not exist.  When you completed your taxes, you paid a hefty price to a tax preparer.  This was unless you knew how to decipher the tax laws, prepare your own 1040 by pencil on paper forms, and then write it all again in ink for the final form.  Times sure have changed.

Individuals are no longer limited to a professional tax preparer or reading the fine print on all the new tax laws while filling out the paper form(s).  Today, the majority of people who want to file their taxes look for the ability to electronically file at the most reasonable cost.

One place I have found helpful in retrieving information on how to file your taxes is the IRS website.  The IRS website contains vital information on the file format your e-file should be in whether you file it yourself or have a professional tax preparer complete your taxes for you.  This information is available free of charge, at your fingertips, and at the click of a button.  If you do not have internet available at home, you can access this information at your local library.

There are many choices on federal tax preparation.  The sites listed below offer information and links to the IRS website to assist in choosing a method to electronically file your taxes in the right file format.  If you stand in a store having difficulties determining which e-file provider or software to use, visit the IRS website to see what information is available.

For free federal tax filing, if you are at or below an adjusted gross income of $57,000 per year, you can use most of the software links listed at their websites for free.

The IRS has a website that allows all taxpayers to use the e-file option for free.

• FreeFile
• IRS Information Site on Free File
• Authorized IRS e-file Provider for Individuals - You will need to put in your zip code to display the correct e-file options for your area.

For Indiana residents, you can free e-file  for state taxes as well, information links for those residents who qualify to file their state taxes.  Check with your state website to see what may be available for filing your state taxes to at a reduced cost or for free.

paper tax form

It is important to determine which option best fits your situation; filing your own taxes or using a professional tax preparer.  It is important to decide how much you wish to spend for completing your yearly federal and state tax preparation out of those same wages to justify the cost.

Estimate College Loan Amounts & Escape the Burden of Debt

By Andrew is a writer who loves to contribute his articles to various financial communities, websites and blogs

U.S. higher education stamp

Such high levels of student loan debt are an impediment to economic growth. It is becoming increasingly difficult for individuals to start their own business, make investments, or purchase homes due to the repayment burden of the loans. Relief from student loan debt will allow these individuals to better manage personal finances. They will be able to direct the funds towards the production of goods and services that are so often asked of them. Rising tuition costs and the necessity of higher education for a better future, forces students to borrow mountainous amounts of debt. This leaves you with one question – What is the correct amount that one should borrow?

The following are important tips you should consider to get help for college.

younger generation asking advise of the older generation

Talk to someone – A student borrower may not have enough experience to make accurate financial decisions on his or her own. A parent, grandparent, or an experienced representative at your school’s Financial Aid Office could enlighten you on the matter.

It is important that you consider only the necessary expenses while deciding on your loan amounts. You have to keep other unnecessary expenses out of the picture to avoid high debt loads. Think about your wants versus your needs!

Focus on your future needs – Just like borrowing extra money is not a good decision, borrowing less money than needed could also create financial troubles. Keep in mind that you have to take care of your expenses once you’re out of college. The extra money borrowed could help you meet your expense needs during college and to some extent, until you find a better source of income.

Don’t ruin your future – You must have certain goals in mind. Carrying a burden of huge student debt could prevent you from achieving those goals. Hence, it is important that you borrow reasonable limits so that your future dreams and plans don’t get stalled right away.

Estimate your monthly debt payments – You have to make monthly payments towards your student loan debt. Try to estimate the monthly debt amount. This way you’ll know whether the monthly debt payments are going to pull your budget and personal finances apart. You should be comfortable paying the monthly debt amount.  You can estimate your monthly student loan payments from online calculators like PayBackSmarter.com.

graduate under heavy debt

Keep your debt payments lower than your projected income – Don’t borrow more than what you expect to earn. Use salary estimators if you have to, but don’t ever overlook the fact that borrowing more than your future income could mean trouble.  You can find a handy salary estimator at salary.com

Knowing the right loan amount is the key to making the best use of student loans.

Budgeting with Buxfer

By: Kayla Rudd, Purdue University student, English Education Senior, and Employee of Purdue University’s Division of Financial Aid

piles of receipts

Personally, I used to consider budgeting a necessary but time-consuming process.  Creating a detailed budget used to take up a major part of my weekends.  I would gather receipts from recent purchases sit down and draft Excel spreadsheet after Excel spreadsheet, labeling and organizing, copying and pasting, and configuring functions to calculate my budget.  Luckily, technology has improved greatly freeing my weekends of tedious budgeting with Excel.  Through a bit of research I was able to find several budgeting software resources.  And, best of all, they’re free!

Overall, there is one resource that worked best for me.  This resource keeps track of all of my budgeting materials at one time and in one place.  I have access to my budgets online, and they even have an app available for smart phones.  This resource is called Buxfer and it is easy to use with a Gmail-like design.

The basic version is free, and its features have proven to be plenty for me.  On the other hand, if you have in-depth and complex financial budgeting matters, I would suggest upgrading from the free version.  Additional features like unlimited accounts, unlimited budgets, account forecasting, and unlimited online payments can be accessed with the paid version.

Budget chart

With the free version I was able to choose to either manually set up my accounts by entering each transaction one at a time or I could have my accounts synchronized automatically with my banking information.  In order to sync your accounts automatically first you need to sign up with your email and create a password. Then choose which accounts you want to synchronize automatically.  Next find your banking institution, type in your online log in information, and voilà you are now ready to track and budget your expenses like a professional!  Buxfer will download your transactions by synchronizing to your banking information.

Setting my own budgets to control spending is one of Buxfer’s features I really appreciate.  Sometimes you may have to re-categorize your transaction labels to ensure purchases are recorded in the proper budget category.  Another feature I find useful allows me to schedule when my bills are due and have reminders sent to me.

My best advice for this website is to try it out.  Test the demonstration and if you like what Buxfer has to offer and then sign up if it fits your needs.  Below is a summary list of services that Buxfer offers with the basic, free plan:

• Synchronizing bank accounts and credit cards
• Create spending limits
• Real-time alerts to mobile device
• Email bill reminders
• Plan future financial goals
  • marriage
  • vacation
  • vehicle
  • home
  • Track group expenses
    • roommates
    • Access with Blackberry, iPhone, SMS, email, Twitter, Facebook, iGoogle, Netvibes…

If Buxfer is not right for you there are plenty of other budgeting software resources available on and offline.  For example, Mint.com is a budgeting website that offers features like Buxfer.com, but with a different feel and design.  If synchronizing your banks accounts online is a concerning issue Clearcheckbook.com could be a better fit for you.  At Clearcheckbook you enter in each purchase transaction, categorize that transaction, and then the website will track and create reports for you.  If you are not comfortable with online budgeting at all you may want to look into software packages like Quicken, Excel, or ask your banking institution about software packages they may offer.

The importance of budgeting does not lay with how you budget, what software you are using, or if you are paying for the service.  What is important is that you are budgeting, tracking your expenses, and contemplating your purchases.  Without creating a budget it can be difficult to reach life’s financial goals like marriage, purchasing a home, going on vacations, or planning for unexpected events.  Share what budgeting avenues works best for you in the comment section below.

man on top of a mountain during sunset

Low Cost Valentine’s Day Activities

By: Mary Elbert, Health and Human Sciences Extension Educator –  Family Resource Management, Warrick County Extension Director

Want to do something for your special valentine without breaking the bank?  Try one or more of these low-cost Valentine celebration ideas:

• Bake Valentine Cookies to decorate and wrap
• Make homemade Valentines
• Buy flowers early or late – they will be ½ the cost
• Cook dinner together and add candles to the dinner table for a special romantic touch
• Look for discounted coupons on-line and get your meal for cheap
• Buy chocolates the day after Valentine’s day and save BIG
• Leave love notes in unexpected places
• Walk in the park or go for a hike – gets your heart pumping and can be very romantic
• Watch a romantic movie at home
• See a matinée or visit a smaller movie theatre for cheaper prices
• Go for dessert only & save on meal costs
• Chocolate covered anything –  fondue party anyone?
• Low Cost Breakfast for two
• Create a list of “100 reasons I Love You” – wrap and tie with a bow
• Write a love poem or story
• Create a 12 month coupon to redeem on any day – ex.  Foot massage, a back rub

What are you doing for Valentine’s Day?

Heart Shaped Strawberry Cake

heart shaped cafe latta

hiking trail

Should I file my own taxes?

By Kimberli Youngblood Report Writer, Date Support Specialist, Purdue Alumni

cartoon man with briefcase flowing of money

This is a question all taxpayers have faced at one time or another.  The dreary thought of the men in black suits showing up at your door to collect taxes drives people to complete their taxes.  I imagine most have heard their elders say that there were two sure things in life: taxes and death.  Regardless though, we still are left each year with the question of whether we should file our own taxes or use a professional tax preparation service.

Over twenty years ago, an option to purchase your own software that would be updated on the new federal tax laws did not exist.  When you completed your taxes, you paid a hefty price to a tax preparer.  This was unless you knew how to decipher the tax laws, prepare your own 1040 by pencil on paper forms, and then write it all again in ink for the final form.  Times sure have changed.

Individuals are no longer limited to a professional tax preparer or reading the fine print on all the new tax laws while filling out the paper form(s).  Today, the majority of people who want to file their taxes look for the ability to electronically file at the most reasonable cost.

One place I have found helpful in retrieving information on how to file your taxes is the IRS website.  The IRS website contains vital information on the file format your e-file should be in whether you file it yourself or have a professional tax preparer complete your taxes for you.  This information is available free of charge, at your fingertips, and at the click of a button.  If you do not have internet available at home, you can access this information at your local library.

There are many choices on federal tax preparation.  The sites listed below offer information and links to the IRS website to assist in choosing a method to electronically file your taxes in the right file format.  If you stand in a store having difficulties determining which e-file provider or software to use, visit the IRS website to see what information is available.

For free federal tax filing, if you are at or below an adjusted gross income of $57,000 per year, you can use most of the software links listed at their websites for free.

The IRS has a website that allows all taxpayers to use the e-file option for free.

• FreeFile
• IRS Information Site on Free File
• Authorized IRS e-file Provider for Individuals - You will need to put in your zip code to display the correct e-file options for your area.

For Indiana residents, you can free e-file  for state taxes as well, information links for those residents who qualify to file their state taxes.  Check with your state website to see what may be available for filing your state taxes to at a reduced cost or for free.

paper tax forms

It is important to determine which option best fits your situation; filing your own taxes or using a professional tax preparer.  It is important to decide how much you wish to spend for completing your yearly federal and state tax preparation out of those same wages to justify the cost.

Students and Credit Cards: How to Know if a Lender is Safe

There are so many things to be afraid of when it comes to getting a credit card as a student. Creditors are known to prey on incoming college freshmen by mailing pre-approved cards. Unsuspecting students may assume that these cards provide the regular benefits of typical credit cards. Others have never taken out a line of credit and don’t yet understand the ins and outs of paying the money back in a timely manner.

There is no problem with college students taking out lines of credit. Expenses that come up during college are sometimes unexpected. It’s good to have a credit card around in case you need access to money in an emergency. It’s also a good idea to start building up a good credit score early-on and taking out a student credit card is a great way to do that.

Pen signing a paper

The overwhelming problem with student credit cards often has to do with the lender. Many ‘deals’ proposed to student borrowers are shady and designed to mislead students into signing up for cards and making purchases that they are not prepared to handle.

These cards often come with easy spending deals that look great on the surface but quickly change to extremely high interest rates, where the students end up paying much more than they originally borrowed for the purchase. Or worse, they end up not being able to pay the sum back altogether, ruining their credit, and possibly getting the bill sent to collections. If this happens, the credit card companies simply write the cost off in their taxes, while the students deal with a huge scar on their credit report for up to seven years.

That’s why it’s important to make sure to sign up for a credit card that has the student’s best interests in mind.

The card should have no hidden fees and a reasonable interest rate. It should also have a very low credit limit, so students cannot continue to borrow into the thousands of dollars.

An example of this type of card is the SAFE Credit Union Student VISA Card. Here are some of the benefits, which are great things to look for in any student card:

This card offers a maximum $500 credit limit, which is very modest and an appropriate amount for a first card.

There is no annual fee.

A parent or guardian can be required to co-sign for the card, offering the student further protection.

Students can still apply and become approved, even without a credit history.

There is a 25-day grace period after all purchases.

There is no fee for cash withdrawals if done through SAFE online banking or ATMs.

You can bank with the program and use the credit card as a form of overdraft protection.

There are built in safeguards against unauthorized transactions, in case a card gets stolen or hacked.

You can compare credit cards online here.

Stella Walker is a writer for creditscore.net and an avid researcher of credit and insurance news. She is especially passionate about protecting consumers from credit card scams and helping students protect good credit standing.

Financial Resolutions for the New Year

By: Raysha Duncan Purdue University Student and Peer Counselor

Last year the 8^th most common New Year’s resolution in America was to get out of debt. However, if you were to poll Purdue’s student population on how realistic getting out of debt was for current students, the student’s response would be laughable. Every year students rack up more and more debt in student loans to pay for their college education.  It’s impossible to expect any student to pay off all of their debt by working part-time jobs and studying for class all night long. Perhaps a more reasonable New Year’s financial resolution for college students would be to start setting money aside every once in a while.

Climbing Out of Debt

This sounds like a pretty hefty task when it’s not explained. If students stop depending on their credit cards so much and only borrow what they need in student loans, they could save themselves a little pain in the long run by minimizing their debt today. Cutting back on expenses doesn’t have to be painful, especially once you’ve had time to adjust. For instance, I love drinking coffee and I really love the delicious coffees sold in coffee shops, but I know it’s expensive, upwards of $5 per coffee. So, recently I started opting for buying my favorite brand of coffee and brewing it at home. A bag of my favorite brand costs around $10 a month. If I only have one cup of coffee every day for a month, I’ve already saved myself $140 for that month. Now, I do crack and have to buy a delicious coffee once in a while, but for the most part, I’ve become satisfied with a good cup of joe at home.

coffee

If instead of buying a coffee every day, I put $5 in my savings account instead, I would be able to save $1825 in one year. Even if I bought myself a coffee just once a week to have a little treat, I could still save $1565. That sounds easy enough right? Just by cutting out one seemingly small, but regular expense in my life, I could save a lot in one year. Here’s the catch, in order to save the money, I actually have to put it into my savings account or somewhere else where I won’t touch it, which I haven’t been doing; but, I think I’ve found my New Year’s resolution.

New Year’s resolutions are meant to help better lives and reach goals. They’re not meant to be impossible to reach. Taking baby steps towards become more financially stable in college could definitely help everyone in their future. It’s harder to make drastic cuts in finances when they are already so small, but by cutting corners in expensive and bad habits, we could all definitely save a lot.