Education

Money Management 101 for Single Parents Going it Alone

Posted on November 8, 2018 by Lake Avenue Financial

1. Determine What You Owe

As the head of the household, it’s up to you to make sure that your entire family’s needs are being met. In order to do that, you need to be extremely diligent when it comes to money management basics. This is not something that will happen by accident. Instead, you must plan for it and work toward it.

The first step is to set up your “office.” Gather all of your bills, a calculator, a pencil, and your checkbook.

I would also recommend that you grab an old binder that you can use to keep track of your financial data and a shoebox for storing paid bills.

Now you’re ready to begin:

Go through all of your bills, and pay anything that is due within the next week.
If you have bills coming due that you cannot pay, notify the company and ask them to set up a payment plan with you.
Print a copy of the chart “Paying Down My Debts” or make your own.
On the chart, list all of your debts, including any car loans, student loans, and credit card debt.
In addition, list the total balance left to be paid on all of these debts, and the percentage rate you are paying.
For now, leave the fourth column of the chart blank, and store it in your “Financial Data” binder.

2. Eliminate Joint Debt

Before we create a plan for paying down your debt, it’s important to consider some special circumstances that may apply to you as a single parent. I asked LaToya Irby, Credit/Debt Management Expert, to share her expertise on handling joint debt:

Wolf: Let’s say a single mom still shares a credit card with her ex. What should she do?

Irby: Ideally, she would want her ex to transfer his portion of any joint balances onto his own credit card. That way, everyone is paying for their own debt.

Wolf: What about leaving both names on the account, and agreeing to pay part of the amount due? Is that ever advisable?

Irby: No. If you’ve made an agreement with your ex to split the debt payments on accounts that include your name, and your ex-misses a payment, it’s going to hurt your credit. If the ex-fails to pay altogether, the creditors and collectors will come after you. Not even a divorce decree can change the terms of a joint credit card agreement. In the credit card issuer’s eyes, you’re just as much responsible for post-divorce accounts as before.

Wolf: What about situations when a couple’s divorce decree mandates that one individual must pay off the joint credit card debt, but that person fails to do it?

Irby: You can always file contempt of court papers against him/her, but in the meantime, your credit score suffers. So I suggest paying off the debt to save your credit. If you can’t afford to pay the debt, at least make minimum payments to keep a positive payment history on your credit report.

Wolf: What about other accounts, such as utilities and cell phones?

Irby: The safest thing to do, if you have a service in your ex’s name, is to turn off the account and reestablish service in your name.

3. Find Money to Pay Down Debt

Another thing we have to do before creating a plan to pay down your existing debt is to find money in your budget each month. To assist in this step, I contacted Erin Huffstetler, Frugal Living Expert.

Wolf: How much money do you think the average person can uncover just by being more intentional about spending and budgeting?

Huffstetler: The average person could easily uncover an extra $250 a month—and probably much more.

Wolf: What are the top 5 areas that you think people should look to first when they’re trying to cut their expenses?

Huffstetler:

Food spending (both groceries and eating out)
TV-related expenses (cable/satellite services, certainly; but also movie subscriptions and rentals)
Phone services (particularly extras like call waiting, caller id, long distance, and cell phones)
Insurance premiums
Miscellaneous spending (all those small amounts spent on coffee, vending machine snacks, and other indulgences)

Wolf: How can single parents, specifically, stretch their child support dollars and reduce child-related expenses?

Huffstetler: For single parents looking to stretch their child support dollars, creativity is the key. Look to children’s consignment shops and thrift stores to buy your kids’ clothes instead of department stores; sign them up for Parks and Rec-run activities instead of privately-run activities (which will always cost more); and don’t feel like you have to make up for being a single parent by buying them extra things—it’s you they need, not stuff.

4. Pay Off Your Debt

The next step is creating a schedule for paying down your debt:

Pay off the debts that charge you the highest interest first.Bob Hammond, author of Life Without Debt, recommends that you pay off the debts that are charging you the highest interest first since borrowing from those creditors is costing you the most money. “Concentrate on paying off the high-cost debts as soon as possible,” Hammond advises. LaToya Irby, Credit/Debt Management Expert, agrees. “Highest interest rate debts cost the most money, especially when those debts have high balances. So you’ll save money on interest charges when you pay off those high-interest rate debts first.”However, there are exceptions to this general rule. Irby notes, “If you’re likely to get discouraged because it’s taking a long time to pay off that high-interest rate debt, you can start with the lowest balance debt. Getting some small debts paid off will motivate you to keep going.”
Pay more than the minimum payment. Aim for paying more than the suggested minimum payment, in order to pay off your debts as quickly as possible.Miriam Caldwell, Money in Your 20’s Expert, shares this advice:
- Choose one debt to focus on.
- Increase your payment on that debt by as much as you can.
- Once you have paid off that debt, move all that you are paying on it to the next debt you want to pay off.
- You’ll be surprised at how quickly you can get out of debt with this plan!
Meanwhile, continue to pay the minimum balance due on all of your other debts.Record what you intend to pay toward each debt on the debt chart you made in Step 1.

5. Budget Your Monthly Expenses

Now that you know where you stand financially, and you’ve created a plan for paying down your debts, it’s time to make sure that you’re making any other necessary adjustments so that you can keep up with your plan. And this means creating a budget.

I know this can be intimidating, but I’m going to make a suggestion for you: Sign up for Mint.com. It’s a free financial software program available on the Internet, and it will basically do your budgeting for you. It will create a visual pie chart showing how much you’re spending each month on housing, gas, food, entertainment, and more. This way, if it turns out that you’re spending a lot more on food than you really should, you can begin to make the necessary adjustments to get your spending under control.

If you would prefer to create your budget the traditional way, allotting a certain amount of money to each spending category, I’ve created an online budget calculator you can use, which includes categories for child support and other details specific to your life as a single parent.

Finally, in taking a look at where your money really goes each month, it’s important to know approximately how much money you “should” be spending in each category. Generally speaking, your net spendable income (after taxes) should be allocated as follows^*:

Housing: 30%
Food: 12%
Auto: 14%
Insurance: 5%
Debt: 5%
Entertainment: 7%
Clothing: 6%
Savings: 5%
Medical/Dental: 4%
Miscellaneous: 7%
Child Care: 5%
Investments: 5%

6. Set Financial Goals

Now that you’ve worked out a plan to pay down your debt, and you’ve created a budget, it’s time to determine your needs moving forward.

Specifically, as a single parent, you need to ask yourself some questions, such as:

Do you need to file for child support?
Do you need to get a higher-paying job?
Is it time to think about going back to school?
Do you need to consider moving into a home/rental that would reduce your overall monthly payments?
Are there alternatives, such as taking on another job or splitting expenses with another single parent family, that you need to consider at this point?

One of the things that I want you to know is that the ball is in your court. You determine where this goes from here on out. But unfortunately, you can’t do that if you’re ignoring your financial health, right?

So the fact that you’ve come this far in the process of getting a handle on your finances tells me that you’re determined to make the changes you need to make in order to provide for your family’s future.

So go ahead and ask yourself these questions. So much of single parenting is learning to roll with the punches and be creative in the face of adversity. If, indeed, you need to make some pretty major changes, now is the time to do it. Don’t incur any more debt where you are. Be resourceful, follow through, and do what you need to do to turn your financial situation around.

7. Increase Your Net Worth

The next step is to determine your net worth and begin adding to it.

Determine Your Net Worth:

Your net worth is what you own minus what you owe. Programs such as Mint.com, Quicken, and Microsoft Money will calculate your net worth for you, automatically.

You can also determine your net worth simply by adding up all that you own, including all of your investments, the equity you may have paid into your home, the value of your car, and any other assets you possess; and subtracting what you owe in remaining debts.

Set Up a Savings Account:

Once you know where you stand, you’ll be ready to set up a savings account. You can do this through your regular bank, or begin investing in a mutual fund that pays interest.

Even if you can only afford to set aside $25 or $50 per month, it will begin to add up.

Before you know it, you’ll have an emergency savings plan in place, to protect you in the event that your car breaks down, or your home needs a major repair.

In addition, this regular savings will help you increase your net worth over time.

8. Become Even More Frugal

Unfortunately, all of the work you’ve already done in steps 1-7 will have little lasting value if you don’t change your attitude toward money. Now is the time to become even more frugal and learn to live within your means.

Practice Discipline:

Stop imagining that more money is going to pour in tomorrow—through finally collecting on unpaid child support, winning the lottery, or getting a promotion. If those things happen, great! You’ll be even better off. But living as if they’re going to happen is causing you to spend money you don’t have.

Instead, force yourself to make purchases with cash only. Do not continue to pay outrageous interest payments toward credit cards for purchases you don’t absolutely need. You can get by without that new furniture, right? What else could you skip, in the interest of spending only what you have right now in the bank?

Try These Ideas:

Check Freecycle before you make another major purchase. Someone else may be giving away the very thing you’d like to buy!
When you’re getting ready to buy something specific, look for it on eBay first. I buy a lot of my clothes, new-with-tags, through online auctions!
Forget trying to keep up with “The Jones’s.” You already know your value; don’t get caught up trying to “prove” your worth to others by having “just the right” house, car, or appearance.
Do not use shopping, ever, to appease your emotions.
Finally, when you do go to make a big purchase, step back and give yourself a few days–or even a week–to think about it. There’s no reason to suffer through buyer’s remorse and try to justify to yourself purchases that you really can’t afford. Think it over carefully and make those purchases, when necessary, with cash.

9. Schedule Your Own Weekly Financial Check-In

Grab your calendar and schedule a weekly financial update meeting with yourself. This is an extremely important step in managing your personal finances, and it’s one that you need to continue each and every week. During your “meeting” time:

Pay any bills that are due.
If your bank statement has arrived, take the time to balance your checkbook.
Check the balances of your checking and savings accounts.
Update your debt list to incorporate any recent payments.
This is also a good time to write out your grocery shopping list and check what’s on sale at your local grocery store this week (either using the store’s Web site or the sales circular that comes in the newspaper).
Finally, also make note of any upcoming expenses you need to anticipate and plan for.

An attitude of gratitude and finances.

^{References:

Irby, LaToya. Email interview. 24 Oct. 2008,}^{Huffstetler, Erin. Email interview. 24 Oct. 2008.}

^{Sources:

Caldwell, Miriam. Email interview. 27 Oct. 2008, Hammond, Bob. “Debt Free Key: 10 Steps for Coping With Credit Problems.” Life Without Debt. Franklin Lakes, NJ: Career Press, 1995. 31-32, Irby, LaToya. Email interview. 24 Oct. 2008.}^{“Spending Plan Online Calculator.” Crown Financial Ministries. 11 Oct. 2008.}

Written By: Jennifer Wolf

Source: thebalance

Raising Kids to Be Smart About Money

Posted on July 31, 2017August 1, 2017 by Lake Avenue Financial

Young minds are programmed to absorb and copy the behaviors around them, which means the sooner you instill proper money management skills, the more prone your kids are to become mature and responsible stewards of their own cash-flow in the future.
“Becoming financially literate early in life is fundamentally important to your financial well-being as an adult,” says Micah Fraim, award-winning CPA and best-selling author.

“I was pinching pennies at five years old, calculating the cost of grocery items per ounce, refusing to buy expensive clothes unless they were on-sale and foregoing scoops of ice cream from the ice cream shop, so I could buy multiple gallons at the grocery store,” Fraim says. “Now as an adult, I still have that same mindset and live well below my means.”

The following kid-approved strategies help you teach the core tenets of being financially savvy; in terms they’ll understand and appreciate. Consider how you can use them to teach your little ones to be smart about money.

Find Opportunities for Lessons

At some point, your child will inevitably deplete their allowance on impulse purchases, rather than holding out for the more expensive item they’ve been asking for. Instead of giving them more money, or buying it for them, use this as an opportunity to demonstrate that money is a finite resource, which must be allocated over an extended period. Once you spend, it’s gone until you can make more.

Have a conversation about what else they could have done with that money, or how much longer they would have needed to save to get the big-ticket item they wanted. Perhaps give an example of when you spent foolishly, or better yet, saved enough money to buy something important, like your house or car.

Demonstrate that Income Is Earned

Chores are an easy way to teach children that money must be earned. This tangible incentive for contributing to your household shows them that have to work for what they want, and even do things they may not want to do—i.e. vacuuming and doing the dishes.

The concept of having to earn your money is a positive outcome of rewarding children financially for completing chores. However, some parents find that this method doesn’t necessarily teach money management, making it a bad way to teach children how to be smart about money. The key to avoiding the latter is the set-up.

Susan Borowski, mother and author for Money Crashers, shares how she set this up with her teenage son:

“As a contributing member of the family, my 13-year-old son is expected to do certain chores around the house for free. He can earn money for tackling larger tasks, many of which he can choose, some of which he cannot; the amount he earns depends on the difficulty of the task or how long it takes. This forces us to discuss money each time he takes on a larger task.”

This shows them that they have control over how much they earn, rather than it being a given.

Secondly, keep chores focused on money management with an app like Chore Monster so children can track what they’ve done and earned. This is an easy way to establish a record-keeping system, for both chores and allowance, seeing increases or decreases in money earned over time.

Establish a Record-Keeping System

When your child is consistently earning allowance or money for chores, it’s important that they’re able to account for what happens with that money. The more emphasis you put on this piece of the earning, the more they’ll see the value of managing their funds. They’ll start to notice wasteful spending habits and identify which pitfalls to avoid during their next allowance payout.

Designate a folder where they can stockpile receipts and a notebook where they can track all purchases. This simple method of financial reporting is an ideal precursor to balancing a checkbook, analyzing bank statements, or creating a monthly budget.

Use Visual Aids to Your Advantage

Although the “piggy bank” is a time-honored childhood favorite, this approach to money management doesn’t allow your child to see the positive outcome of their coin stashing. For a more functional alternative, use a transparent mason jar or clear plastic Tupperware container, both of which gives them an unobstructed view of the progressive financial increase that comes from diligent and habitual saving. This tool makes the abstract concept of saving easy to see and understand.

You can also open a bank account for older children. This gives them a chance to become familiar with bank statements, which act as a visual aid. Each time a new statement comes in, they can sit down and look at how much money was put into the bank account and how that’s changed month-over-month. Many banks now offer online portals, as well, where your children can see progress represented in bar and pie graphs; these may be easier to understand and digest.

Encourage Them to Set a Savings Goal

There’s a sense of accomplishment and empowerment in reaching a goal with no shortcuts taken or assistance received. Channel this mindset when encouraging your child to practice economical behaviors. Next time they express interest in the latest gadget, suggest they purchase it themselves and develop a step-by-step plan together, so they feel equipped for the undertaking. This process of setting aside money with a specific goal in mind reinforces the gratification gained from being smart about money and purchasing the item without any help.

It’s never too early to start teaching your kids about how to be financially savvy. Too many people don’t learn about personal finance until it’s too late — like when they’re buried in student loans — so teaching these skills early on is important for setting your children up for success later in life.

Written By: Jessica Thiefels
Source: PBS

The Selling of the American MBA

Posted on March 19, 2016March 19, 2016 by Lake Avenue Financial

In December the University of Rochester’s Simon Business School introduced loans that don’t require co-signers for international students entering its full- time MBA program this fall. Simon is also cutting its tuition by almost 14 percent and strengthening career services to help foreign students land jobs. The school recruited in more than a dozen countries last year, holding events in Buenos Aires, Cairo, Taipei, and Istanbul, among other cities. The efforts reflect the school’s “very strong commitment to global diversity within its student body,” says Rebekah Lewin, assistant dean of admissions and financial aid at Simon, where about half of the 98 full-time MBA students in the class of 2017 are from overseas.

As the U.S. appetite for the MBA degree wanes, many of the country’s more than 700 B-schools are stepping up recruiting abroad, where regard for this American invention appears undiminished. (Harvard was the first institution to offer an MBA, in 1908.) The number of U.S. citizens taking the main business school entrance exam, the GMAT, dropped by a third from the 2010 to 2015 testing years, which run from July 1 to June 30, while the number of foreign nationals taking the test rose almost 19 percent, according to the Graduate Management Admission Council, the organization that administers the exam. International candidates accounted for 58 percent of the applicant pool at full-time MBA programs in the U.S. in 2015, according to GMAC.

Nunzio Quacquarelli, chief executive officer of Quacquarelli Symonds in London, which helps business schools recruit abroad, says international students make up more than 35 percent of the class at over 50 of the 200 U.S. business schools he tracks, compared with just a “handful” a decade ago. Foreigners are “providing vital tuition revenue and compensating for any decline in domestic revenue,” he says.

“You come here, you study, you want to stay here, you have a company that wants you to work for them, and the lottery just might not pick you”

Enrollment in U.S. MBA programs is down 11 percent since 2009, according to a survey of 265 B-schools by AACSB International, an accrediting group. Tom Robinson, AACSB’s president and CEO, attributes the trend to a shift away from the MBA to specialty masters in areas such as marketing and nonprofit management. AACSB’s data show an overall increase in enrollment if those are counted. “I’m not worried about it, because there’s always going to be some subset of the population that wants the generalist management education and wants to do it full time,” he says.

This is a starkly different outlook than that offered by Roger Martin, who led the University of Toronto’s Rotman School of Management for 15 years. Martin, who stepped down as dean in 2013 and now heads a research institute at the university, says U.S. MBA education is in “the declining phase of its long and relatively illustrious history.” He predicts that half of U.S. business schools may not be operating in 10 to 15 years, because there won’t be enough enrollment to support their “very bloated” cost structures.

Ramping up international admissions is a temporary fix, Martin says. And helping foreign graduates land well-paying jobs in the U.S., which is what most of them aspire to, may prove a big headache. A student from India doesn’t want to collect his degree, he says, and “go back to India to an Indian salary.”

Fabio Bergamo, a Brazilian who graduated from Columbia Business School last May, says getting permission to work in the U.S. has been a “disappointing” struggle. Even though his employer, a fashion overstock startup in New York, is sponsoring his work visa application, there’s no guarantee the government will grant it. “You come here, you study, you want to stay here, you have a company that wants you to work for them, and the lottery just might not pick you,” he says. “I’m in the dark if I’m going to be here after July.”

Prodigy Finance, the London-based lender that financed Bergamo’s degree, says international MBA seekers in the U.S. have become an important part of its business. It expanded into the U.S. in 2014, pilot-testing loans at the University of Michigan’s Ross School of Business and Columbia Business School. Last year it loaned about $100 million in total, half to foreign students at about 45 top-ranked U.S. business schools. “There’s been huge growth in the U.S.,” says Ricardo Fernandez, the 75- employee company’s head of business development. “International students are critical to MBA programs.”

The bottom line: In 2015 international candidates accounted for 58 percent of the applicant pool at full-time MBA programs in the U.S.

Written by Nick Leiber of Bloomberg

(Source: Bloomberg)

The Not-Rich Kid’s Guide to Graduating from College with Almost No Debt

Posted on November 17, 2015November 14, 2016 by Lake Avenue Financial

I was raised in a working-class neighborhood near Dallas by my mother, an immigrant from Vietnam. I attended the public schools nearby. We had metal detectors, drug searches using police dogs, a vice principal who was shot by a BB gun at a school assembly, and a teacher who was hospitalized after students put staples in her coffee — and that was just at my middle school.

I avoided the stress of dealing with drugs and gangs by routinely skipping classes. When I was 16, my high school principal told me that my spotty attendance was hurting the school’s funding, so she gave me an ultimatum: I could drop out, or I would be given a large truancy fine. Unable to afford the fine, later that week I became a high school dropout. (More accurately, I was a pushout).

I had to wait a few months until I turned 17 to become eligible to take the GED exam in Texas. Since I had an open schedule, I thought I’d get a full-time job. At an interview with Office Max for a position assembling office chairs, the manager was obviously disappointed that I did not have a high school degree, and I did not get the job. When I realized that I didn’t meet their hiring standards to work in the back of the building screwing armrests into chairs, I decided I had to go to college.

But then came the question of how to pay for college. College costs are sky-high. About 70 percent of students who graduated with a bachelor’s degree in 2012 borrowed money—of these students, the average debt was $29,400. After watching my mother struggle with debt, I was determined to avoid loans as much as possible by making every dollar that went toward college expenses count. And I succeeded: I managed to graduate from the University of North Texas with a degree in sociology in five years with a single loan for $4,000. I now attend a PhD program at the University of Pennsylvania.

Graduating from college with minimal debt isn’t easy. There’s a reason there’s a student debt crisis. But some media accounts would have you believe that students have no choice but to take on large debts — and be haunted by them for decades after they graduate. And in my experience, that’s just not true. I know the challenges for every student are different, but these are the eight ways I made college as affordable as possible.

1) I took as many community college courses as I could

I passed the GED and began considering what college to attend. After my rocky high school career, my family and I weren’t sure how I would fare in college, so we didn’t want to spend a lot of money.I also hadn’t taken the SAT, so I wasn’t even sure if I could apply to universities. So I enrolled at a nearby community college with open admissions and low tuition with the intent of earning my associate’s degree.

While community colleges are less prestigious than four-year schools, they are also a lot cheaper. According to the US Department of Education, the average tuition and required fees at a four-year institution amount to $8,070 for an academic year. At a two-year institution, it is “only” $2,792. By these numbers, if you attend community college for two years instead of a university, you would save an average of about $10,500 in tuition, plus the cost of living at a dormitory that is often mandatory.

And at least in my case, the education I got at community college was in some ways superior to what is experienced at four-year colleges. I took all of my “basic” or “core” classes (math, English, sciences, history, etc.) at community college, where classes usually have between 20 and 40 students. The same class at a university would have had more than 100 students. As a result, community college professors are more likely to learn students’ names, to grade papers and exams themselves, and to develop relationships with students. As a student who struggled initially, I needed that close attention or else I might have slipped through the cracks.

2) When it came time to transfer, I resisted the allure of the “prestigious” college

After two years of community college, I had won a scholarship and I had a solid GPA — around a 3.5. I could’ve applied to my state’s flagship universities (the University of Texas Austin or Texas A&M University) or a private college like Southern Methodist University. After the embarrassment of dropping out of high school, part of me wanted to show people that I was more than a dropout — to be able to brag that I attended a prestigious university like these.

But I only applied to one college — the University of North Texas, which is not even ranked by the US News and World Report. It was a nearby state university with low tuition costs, and it meant I didn’t have to deal with relocating. My family was fine with the decision. Honestly, attending any university impressed my mom.

Would I have received a substantially better education at a more prestigious university? I doubt it. The truth is that university professors are hired because of their research, not their teaching. Attending a more prestigious university would have meant being taught by professors who had better publication records, but that does not necessarily translate into being better teachers. In fact, in some ways you expect the opposite — the more invested professors are in research, the less time they have for mentoring and teaching.

The best argument for attending a prestigious university is name recognition and alumni connections. If you plan to apply to work at a Fortune 500 company, those things matter a lot. But for students like me who just want to enter a middle-class profession, those benefits aren’t very important. While there are other merits to attending prestigious colleges — like having more dedicated students around you, better libraries, etc. — for me, they weren’t tangible enough to justify paying for higher tuition costs.

3) I learned the hard way to take placement exams seriously

After I met with admissions to finalize my application to the community college, I was told that I should take my placement exams because students are unable to register for classes until they take them. I was surprised — I had never heard of placement exams. Still, I felt pressured to take the exams that day.

When I took the math exam, my score was so low that it required me to take two remedial classes. When the administrator was explaining this to me, she asked me if I had used a graphing calculator — I hadn’t, because I assumed it wasn’t allowed! She suggested retaking the exam to see if it would improve my score. The calculator, and the retesting fee, was not cheap. But my score improved, and I “only” had to take one remedial course instead of two.

According to the most recent figures from the Department of Education’s National Center for Educational Statistics report, 20 percent of incoming students take remedial courses. In some states the average is much higher, such as 51 percent of students in New Mexico. These classes cost money but do not count as college credits and are only required if it is determined that the student is “not college ready.”

You can avoid paying for classes that you don’t need by taking the placement exams seriously and researching the format and what tools you are allowed to use.

4) I used ratemyprofessor.com to avoid terrible professors

My first year in college, I had a terrible history professor. I didn’t know what was going to be on the exam or how to prepare for it. This class was beyond difficult — it was poorly taught, it was confusing, and it was frustrating. I vividly remember the professor blaming the students after the class averaged a D on the first two exams.

After that, I was determined to avoid terrible teachers, so I began looking up prospective professors on ratemyprofessor.com. This website allows students to rate a professor by a few different metrics (such as clarity and easiness). The ratings are subjective, and because of that, you should these ratings with a grain of salt, as every professor with a dozen reviews will have some negative ones.

But students can pretty universally agree on what a terrible professor is. So before I registered for a class, I always looked up the instructor on ratemyprofessor.com. If they had overwhelmingly negative reviews, I did not enroll in the course. Each year, this helped me identify a few professors to avoid, which likely saved me from having to withdraw from a poorly taught course or earning a low grade.

5) I found a mentor who cared about my success

The hardest semester of my life was my first semester at a community college. I felt like I didn’t fit in on campus. The students, administrators, and professors intimidated me. So I tried to be invisible — if I could avoid being on campus, I did.

My English professor, Dr. Lisa Roy-Davis, required students to meet with her individually halfway through the semester (an approach that would not be possible at a university with large introductory courses). I was quiet during the meeting, which made it somewhat awkward, but we got to know each other better. At the end of the semester, I told her I was considering withdrawing from college to focus on working.

To my surprise, she encouraged me to keep taking classes and offered to loan me books by authors who wrote about their struggles in college. I began emailing her summaries of what I felt about the books — and questions about what I should read next.

The more I talked to her, the more comfortable I felt on campus. While the feeling of being an outsider never totally vanished, I no longer wanted to be invisible. I became a more engaged student. My grades improved. I began going to office hours of other professors to ask questions, which is how I found other mentors.

A mentor will answer the questions that you are afraid to ask others, instill confidence in you, and help you navigate college. They don’t have a precise monetary value, but they will help you graduate from college.

6) I learned the tricks to applying for financial aid and scholarships

Financial aid was somehow terrifying and liberating for my family at the same time. Because my mother was low-income, I qualified for federal Pell Grants that helped pay for my tuition and books. But applying for those grants was intimidating. The Free Application for Federal Student Aid (FAFSA) is universal — wealthy students applying to private schools use the same application as working-class students applying to community colleges.

That means students like me have to answer questions using financial terms that my family had never heard of. For example, FAFSA asks whether your parents made “Payments to tax-deferred pension and retirement savings plans (paid directly or withheld from earnings), including, but not limited to, amounts reported on the W-2 forms in Boxes 12a through 12d, codes D, E, F, G, H and S.”

Some families might have parents who are familiar enough with finances to know what this question meant — to my mom and me it was like reading a foreign language. We worried that we were going to unintentionally lie on our application, which we feared was a prosecutable offense. Looking back, I know that sounds silly, but it shows how daunting this process was.

I eventually realized that the answer to questions about investments and pensions was “0,” and that FAFSA’s helpline is surprisingly easy to use. I also figured out that I should complete my application before the “priority deadline” to maximize my chance of being awarded a grant.

In addition to financial aid, I learned how to apply for scholarships. In my sophomore year, I was shocked when Dr. Roy-Davis told me I should apply for the Student Leadership Academy, the most prestigious program at my community college. The application required two letters of recommendation, a transcript, and a personal essay. I didn’t think I fit the “leadership” profile — I didn’t have any volunteer experience, my GPA was about a 3.3, and I barely spoke in class. Why apply for something I won’t win?

Despite my protests, Dr. Roy-Davis insisted that I apply. She coached me through how to ask for a letter of recommendation, what the application process is like, and how to write a personal essay.

The biggest thing I learned was that you don’t have to be better than every student — you just have to be better than the other students that apply. And a lot of awards and scholarships don’t have nearly as many applications as you would think. I was accepted into the program and won a $500 scholarship.

The scariest thing about applying for awards or scholarships is feeling like a fraud. This is impostor syndrome, and minorities are more likely to feel it. Essentially, you will underestimate your qualifications and attribute any previous success to luck, causing you to feel inferior to your peers. The only way to deal with it is to push through it — hopefully with the help of mentors.

7) I bought old textbooks (if my teacher allowed it) to save money

Students spend about $1,200 in college textbooks a year, according to the College Board. In fact, nearly two-thirds of students have skipped buying a required textbook for a course because it was too expensive. My first semester, I was shocked by the cost of textbooks. So I started asking students and professors what I could do to save money. Among the suggestions: buying used textbooks online, renting textbooks online, or buying digital versions of the textbook that were cheaper.

But I learned from a professor that the cheapest option is to buy older editions of textbooks, which are often 60 to 90 percent cheaper. The downside is that textbook publishers routinely shuffle chapters around when they release a new edition every few years because it allows them to call it “new” even if it contains very little new content.

In most cases, you can just use the appendix to find the right chapter if the title of the assigned chapter does not match the syllabus. Still, you should email the professor before the class starts and ask if they believe you can use an older version of the textbook. Most professors will understand why you are asking and reply with whether it is a good idea.

Even if you just did this for half of your classes, you would save about $600 a year.

8) I worked throughout college

During college, I attended college as a full-time student and worked part time. I was tempted to do the opposite — work full time and only take a couple of classes a semester — but I decided that it made more sense to try to graduate as soon as possible. Plus, I was lucky to be able to live at home, which allowed me to avoid taking on a lot of living expenses.

My first job was a custodian at a gas station. I worked the swing shift, which meant that in a given week, I’d have two shifts during the day and two shifts that were from 10 pm to 6 am. While staying up all night mopping, sweeping, and restocking merchandise was challenging, I was glad that they overlooked my GED and gave me a chance to gain some work experience. I later worked in retail and at restaurants.

At times, working while taking classes was difficult. But as long as I had a job with a consistent schedule, I found that I could manage it. And my rule was that I wouldn’t try to work full time while being a full-time student, because it would hurt my grades.

I knew that transferring to a university, even one with low tuition, was still going to cost thousands more. I decided to take a semester off to work full time to save up money. My mom was nervous about me taking any time off, but I felt like one semester wasn’t the end of the world. And it allowed me work a bit less once I transferred.

I managed to graduate at the age of 22 (funnily enough, dropping out of high school caused me to start college a year early). While I was proud that I managed to graduate from college without taking out many loans, I didn’t want to walk across the stage on graduation day. The regalia, the speeches, and the handshake all felt like worthless fluff that would take hours to take part in.

But when I told my brother that I didn’t want to go, he told me that I had to. I was going to be the first in my household to graduate from college — and it meant a lot to them. He was right. My mom cried tears of happiness, and it is one of my favorite memories.

A critic might point out that I saved money to the detriment of my education: I took more community college classes than university courses, I based where to attend not on prestige but on low tuition, and I used old textbooks. But today, I am a doctoral student at the Annenberg School for Communication at the University of Pennsylvania, which is ranked near the top of its field. In addition to a full scholarship, I also receive a living stipend and have won fellowships from the National Science Foundation and Google. Last summer, I interned with the Pew Research Center.

And no one has ever cared where I got my bachelor’s degree or questioned the quality of my undergraduate education.

Written by Alex T. Williams of Vox.com

(Source: Vox)

For-Profit Colleges Transform into Nonprofits to Evade Rules, Report Suggests

Posted on October 8, 2015October 8, 2015 by Lake Avenue Financial

For-profit colleges may have found a loophole to evade the Obama administration’s crackdown on the industry: Transform into nonprofit institutions.

Four college chains, which account for a total of about 50 campuses nationwide, converted to nonprofit entities over the last several years, but still act in many ways like profit-seeking enterprises, a new report suggests.

The schools engage in behaviors that aren’t typical of nonprofits, such as paying lease payments on property to the former owners of the for-profit company and allowing the former owners to have a larger say in the governing of the new nonprofit instead of leaving it up to a group of independent trustees not out for financial gain, according to a review of government documents by Robert Shireman, a senior fellow at the Century Foundation, a progressive think tank based in New York that focuses on education and economic issues.

“I didn’t expect to see such a consistent pattern,” said Shireman, who has also served as an undersecretary in the Department of Education.

These choices raise questions as to whether the schools should be allowed the tax-exempt status that comes with being a nonprofit and whether the Internal Revenue Service is looking closely enough at the schools that request it, the report notes. They also raise concerns that the colleges are looking to evade scrutiny as regulators set their sights on the for-profit college industry.

Once one of the largest for-profit college chains in the country, Corinthian Colleges collapsed earlier this year, after the Department of Education delayed dispersing the school’s financial aid funding amid accusations the company was luring students into taking on loans with inflated career and job placement rates. Federal and state law-enforcement officials have also filed suits against other for-profit chains.

As part of this push to better regulate for-profit colleges, the Obama administration recently strengthened a rule that requires career colleges to prove they’re preparing students for “gainful employment,” or a job in their field, to receive financial aid funding. For-profit colleges are also required to receive no more than 90% of their funding from federal coffers—an attempt to prevent companies from relying entirely on taxpayer dollars for their profits. Nonprofits are exempt from this regulation, and typically they have little trouble finding funding from a variety of sources, Shireman said.“But because for-profits basically prey on people who are eligible for the max financial aid—low income adults—they bump up against that rule pretty frequently,” Shireman said. He’s concerned that the four schools named in the report—Herzing University, Remington Colleges, Everglades University and Center for Excellence in Higher Education—converted their formerly for-profit campuses to nonprofits to avoid having to comply with those rules.

The report calls into question the Salt Lake City-based Center for Excellence in Higher Education’s petition to the IRS to be considered a tax-exempt educational institution, instead of a tax-exempt charity after the organization acquired a suite of for-profit college campuses in 2012. But Eric Juhlin, Chief Executive of the Center for Excellence in Higher Education, disputed the report.

“He’s trying to say that this was a scam and it was a sham” and that the Carl B. Barney, the owner of the for-profit campuses sold them to Center for Excellence “to continue to prosper and benefit from the colleges” while using the nonprofit status to avoid regulations targeting for-profit schools, Juhlin said. “In our case that couldn’t be further from the truth. It had absolutely nothing to do with regulatory avoidance, tax avoidance or trying to play some game with respect to the organizational structure.” Rather, he said Barney decided to sell the campuses to the nonprofit institution as part of “an estate planning decision” that would allow the schools to continue “in perpetuity” even in his absence.

Kelli Lane, a spokesperson for Everglades University, also disputed the report’s findings in a statement, noting that the school began its transition to nonprofit status in 1998 “well before” the current regulatory environment.

“An independent Board of Trustees continues to ensure students are receiving a quality and accountable education,” she said.

Renee Herzing, the president of Wisconsin-based Herzing University, which began the process of changing its status in 2009, said the school is in “solid compliance” with federal and state laws. “Herzing University agrees that becoming nonprofit is a serious commitment to the public good, which is why we decided to pursue that status for our 50-year-old, family-founded institution,” she wrote.

(A representative from Heathrow, Florida-based Remington Colleges, which was approved as a nonprofit in 2010, didn’t immediately respond to a request for comment from MarketWatch.)

Shireman said he’s concerned the trend may go beyond these four chains of schools, noting that he’s looked into a couple of other possible cases. “There could well be more,” he said.

The Department of Education is keeping an eye on this phenomenon and as a result hasn’t yet approved requests from other for-profit schools to turn into nonprofit entities, Dorie Nolt, a Department spokeswoman, wrote in a statement. In the meantime, those schools have to abide by the restrictions placed on for-profit colleges, she added. “The Department shares the concern that some for-profit school owners may adopt the trappings of nonprofit status to avoid certain federal regulations while continuing to make money from the schools,” she wrote.

Written by Jillian Berman of MarketWatch

(Source: MarketWatch)

Best School Districts in Every State

Posted on September 5, 2015September 5, 2015 by Lake Avenue Financial

Whether you’re starting a family, selling a home or choosing a new city to live and work in, the strength and reputation of an area’s public school district is of great importance.

StartClass sifted through data from the U.S. Department of Education and identified the best school district in every state (this list also includes Washington, D.C.). Each school district is evaluated using our Smart Rating system and scored on a scale from 1 to 100.

The ratings are primarily based off student math and reading proficiency on state assessment tests, with a few other institutional factors considered as well (i.e. student-teacher ratio, student discipline, etc.)

Each state’s selection for “Best School District” is determined by the highest average Smart Rating of all the schools in the district. Districts that have only one school or have charter schools were not included.

It’s important to note that each state defines the term “school district” differently. For example, Hawaii and Washington, D.C. each have just one school district for all schools in the state or territory. Other states have districts with a mix of school type—as in elementary schools, junior highs and high schools all together in the same school district.

Whether you’re thinking of moving to a new area, or you’re just curious about the best school district in your state, look no further: Here are the top school districts in each state, in order from lowest to highest Smart Rating.

#51. WASHINGTON, D.C.

District of Columbia Schools

Average School Smart Rating: 57

Number of Schools: 131

Top Schools: Janney Elementary, Deal Junior High School, Benjamin Banneker Academy High School

#50. HAWAII

Hawaii Department of Education

Average School Smart Rating: 61

Number of Schools: 288

Top Schools: Haleiwa Elementary School, Robert Louis Stevenson Middle School, Kealakehe High School, Lanai High & Elementary School

#49. DELAWARE

Caesar Rodney School District

Average School Smart Rating: 76

Number of Schools: 15

Top Schools: Nellie Hughes Stokes Elementary School, Dover Air Force Base Middle School, Caesar Rodney High School

#48. ALASKA

Valdez City School District

Average School Smart Rating: 80

Number of Schools: 3

Top Schools: Shades Hermon Hutchens Elementary, George H. Gilson Junior High School, Valdez High School

#47. FLORIDA

Gilchrist County School District

Average School Smart Rating: 81

Number of Schools: 6

Top Schools: Bell Elementary School, Trenton High School

#46. MARYLAND

Worcester County Public Schools

Average School Smart Rating: 83

Number of Schools: 14

Top Schools: Pocomoke Elementary School, Snow Hill Middle School, Snow Hill High School, Cedar Chapel Special School

#45. WEST VIRGINIA

Pendleton County Schools

Average School Smart Rating: 84

Number of Schools: 4

Top Schools: Brandywine Elementary School, Pendleton County Middle/High School

#44. NEVADA

Storey County School District

Average School Smart Rating: 86

Number of Schools: 4

Top Schools: Hugh Gallagher Elementary School, Virginia City Middle School, Virginia City High School

#43. WYOMING

Sheridan County School District #1

Average School Smart Rating: 86

Number of Schools: 7

Top Schools: Tongue River Elementary, Big Horn Middle School, Big Horn High School

#42. NORTH CAROLINA

Chapel Hill-Carrboro Schools

Average School Smart Rating: 88

Number of Schools: 20

Top Schools: Elizabeth Seawell Elementary School, Guy Phillips Middle School, East Chapel Hill High School

#41. UTAH

Park City School District

Average School Smart Rating: 88

Number of Schools: 13

Top Schools: Jeremy Ranch Elementary School, Ecker Hill Middle School, Park City High School, Treasure Mountain Junior High School

#40. SOUTH CAROLINA

York 04 School District

Average School Smart Rating: 89

Number of Schools: 13

Top Schools: Gold Hill Elementary School, Gold Hill Middle School, Nation Ford High School

#39. GEORGIA

Schley County School District

Average School Smart Rating: 90

Number of Schools: 2

Top Schools: Schley County Elementary School, Schley Middle High School

#38. LOUISIANA

West Feliciana Parish School District

Average School Smart Rating: 90

Number of Schools: 4

Top Schools: Bains Elementary School ,West Feliciana Middle School, West Feliciana High School

#37. OKLAHOMA

Chisholm Public School District

Average School Smart Rating: 90

Number of Schools: 3

Top Schools: Chisholm Elementary, Chisholm Middle School, Chisholm High School

#36. WASHINGTON

Mercer Island School District

Average School Smart Rating: 91

Number of Schools: 5

Top Schools: West Mercer Elementary School, Islander Middle School, Mercer Island High School

#35. SOUTH DAKOTA

Wall School District 51-5

Average School Smart Rating: 91

Number of Schools: 4

Top Schools: Wall Elementary School, Wall Middle School, Wall High School

#34. TENNESSEE

Williamson County Schools

Average School Smart Rating: 91

Number of Schools: 41

Top Schools: Trinity Elementary School, Brentwood Middle School, Fred J. Page High School

#33. NORTH DAKOTA

Wyndmere 42 School District

Average School Smart Rating: 91

Number of Schools: 2

Top Schools: Wyndmere Elementary School, Wyndmere High School

#32. ARKANSAS

Valley Springs School District

Average School Smart Rating: 92

Number of Schools: 3

Top Schools: Valley Springs Elementary School, Valley Springs Middle School, Valley Springs High School

#31. INDIANA

Carmel Clay Schools

Average School Smart Rating: 92

Number of Schools: 15

Top Schools: Towne Meadow Elementary School, Clay Middle School, Carmel High School

#30. VERMONT

Stowe School District

Average School Smart Rating: 92

Number of Schools: 2

Top Schools: Stowe Elementary School, Stowe Middle/High School

#29. IDAHO

Moscow School District

Average School Smart Rating: 92

Number of Schools: 9

Top Schools: Lena Whitmore Elementary School, Moscow Junior High School, Moscow Senior High School

#28. MISSISSIPPI

Pass Christian Public School District

Average School Smart Rating: 93

Number of Schools: 4

Top Schools: Delisle Elementary School, Pass Christian Middle School, Pass Christian High School

#27. VIRGINIA

West Point Public Schools

Average School Smart Rating: 93

Number of Schools: 4

Top Schools: West Point Elementary School, West Point Middle School, West Point High School

#26. ARIZONA

Tanque Verde Unified School District

Average School Smart Rating: 93

Number of Schools: 4

Top Schools: Agua Caliente Elementary School, Emily Gray Junior High School, Tanqu Verde High School

#25. COLORADO

Ouray School District R-1

Average School Smart Rating: 93

Number of Schools: 4

Top Schools: Ouray Elementary School, Ouray Middle School, Ouray High School

#24. IOWA

Gilbert Community School District

Average School Smart Rating: 93

Number of Schools: 3

Top Schools: Gilbert Elementary School Gilbert Middle School Gilbert High School

#23. WISCONSIN

Mequon-Thiensville School District

Average School Smart Rating: 93

Number of Schools: 6

Top Schools: Oriole Lane Elementary School, Steffen Middle School, Homestead High School

#22. KENTUCKY

Beechwood Independent School District

Average School Smart Rating: 93

Number of Schools: 2

Top Schools: Beechwood Elementary School, Beechwood High School