December 2006 Archives

Staci

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Sometimes, I wish I were still in college.

But more often than not, and especially at this hectic time of year, I'm thankful that part of my life is behind me.

Not too long ago I had a dream—more of a nightmare, really—that I woke up in my twin extra-long bed in East Hall , late for my Chaucer> final. I hadn't done any holiday shopping, and I had to be packed and out of the dorm for winter break by noon. The panic I felt when I awakened for real was as palpable as it had been in 1992 .

To be sure, it's a stressful time—and it's no different for college students. Between taking exams, moving out of the dorm, finding funds for holiday gifts, and getting yourself mentally prepared to live with your family again, there's a lot to do.

So give yourself a break. Here's what worked for me:

• Once you get home, sleep. Catch up on all the rest you've been depriving yourself of for the last few weeks (or more likely, the last four months).
  
  
• Don't go overboard on holiday spending. Instead, spend quality time. My mom, who was only too happy to have me home even though my school was just across town, always said, "Your presence is my gift!"
  
  
• Call your high school friends who are home from college—and see how they've changed. All of my formerly clean-cut guy friends were now sporting long hair, beards, and flannel! 
  
  
• Enjoy your family. Take advantage of your brother's technical prowess with computers, your mom's home cooking, and your dad's advice on—well, if he's anything like mine—absolutely everything.

Speaking of winter break, we're taking one, too. The Student LoanDown team will be back with new blog posts in the New Year. Until then, happy holidays!

Caroline

Right now, many of you college students are just easing into a month-long vacation . Well deserved, of course. But believe me, those of us in the workin' world are extremely jealous of you right now (none of us can remember what it was like to have an entire month of vacation ahead of us!).

While it's fantastic to have a month off from classes, many of you probably do have to work over break. Here in the student loans department at Wells Fargo, we'll be seeing some of our college-age summer staff come back to work in January. They help us out through the busy season as we prepare to send out student loans for the second semester.

When I was in college, I often found myself scrambling for odd and temporary jobs to make some extra cash over break. When I look back on it, I probably could have been smarter about how I used that vacation time.

Take my stepdaughter, for instance. She's a college sophomore and—in addition to sleeping late, hanging out with her buddies, and eating some home-cooked meals—she's planning to do some job-shadowing  over her break. She's thinking about a career in occupational therapy  and wants to check it out more closely.

I wish I'd done something similar. Maybe I wouldn't have made any money, but I might have gotten something even more valuable: some insight about the field I was getting into and possibly some good professional contacts that might have led to a summer internship or a job.

Some of you might have a "January term"—where you can take a class or study abroad for a couple of weeks. You don't exactly have a long vacation ahead of you, but you may be getting a great opportunity for travel and studying that you may not have the chance to do after college.

Whether you're working, exploring career options, traveling, or just hanging out with your family, having a month off is so valuable. How are you planning to make the most of your winter break?

Barbara

You know what I miss about my childhood?

Saturday morning cartoons.

The Muppet Babies, Garfield and Friends, and Teenage Mutant Ninja Turtles were up there on my list of must-watch shows. But my favorite—being the self-proclaimed knowledge nerd that I am—was "Schoolhouse Rock!"  I just couldn't get enough of that poor little bill on Capitol Hill .

Wouldn't it be nice if there were a similar song for young adults explaining student loans from start to finish? Don't worry, you're not about to be subjected to any of my (non-existent) singing and composing skills. But it might come in handy to have an overview of the process—application through disbursement—before you dig in.

So, here's my little ditty, featuring Betty Borrower, who is applying for a Federal Stafford Loan :

Our saga begins with the Free Application for Federal Student Aid—this year, the paper form is in a lovely shade of goldenrod—or the FAFSA online . Betty Borrower completes and files her FAFSA in January and then sits back and waits for her school to send an award letter , which outlines the aid for which she is eligible.

As a first-year student, Betty finds out she's able to get a $2,625 Unsubsidized Stafford Loan. Now it's time for her to pick a lender. Betty decides to get some advice from the financial aid office. After talking about her options with a financial aid counselor, she is directed to the school's lender list. A lender list is a set of lenders that your school has dealt with in the past and other students have been happy with. (This  is an example of a list at the University of Texas at Austin.)

Once Betty chooses her lender, she'll need to fill out the actual loan application, which can be found in paper or online. Being a tech-savvy college student, she decides to apply online. After Betty enters all of her information, the application goes to the lender for approval.

Next, the lender works with the guarantor to get a guarantee for Betty's loan. A guarantor is a state or private nonprofit organization that agrees to reimburse Betty's lender if she does not honor her repayment obligation. Think of it as “insurance” for the lender.

Finally, Betty is just one step away from her money! The loan is guaranteed, and voilà, the lender schedules Betty's disbursement to her school. Her attendance is funded with money that Betty will pay back to her lender. She'll get half her money for the fall semester and the other half at the beginning of the spring semester, which is pretty typical. Now, she just has to worry about studying for her classes!

All right, even though it doesn't rhyme, and there aren't any animated dancing loan applications, that's the basic overview. Let me know if I need to elaborate—again, it won't be done in song, so no worries. :)

Caroline

Last month, I posted about care packages and my struggle to come up with a really good one for my stepdaughter.

Well, this is her finals week . So last week I found myself aimlessly meandering the aisles of Target® (one of my favorite pastimes!). But it wasn't as fun as usual. I was fighting the holiday crowds, bouncing from the candy aisle to the goofy Christmas socks and getting nowhere fast.

Then I started to think. How do you REALLY feel during finals week? Usually, you're on the verge of getting sick, right? I made a U-turn and headed for the pharmacy. I picked up a nice package of Vitamin C drops . Tasty. Soothing. Better than candy.

Focused now, I thought, what else? Well, you feel just a little unraveled. Like you're so buried in books, you just can't take care of the little things. I grabbed a tube of her favorite lip balm , which she is forever misplacing. And then a new toothbrush. Don't you feel just a little more pulled together when you have a new toothbrush?

What else do you need at finals time? Something NOT from the pharmacy, perhaps? Nothing says "finals week" like the mushy old highlighters that have been through a semester's worth of cram sessions. I settled on a shiny new rainbow pack of "clickable" highlighters. That should ease the pain of studying a little.

OK, now I was on a roll. Stressed—everyone is stressed during finals. I nabbed a copy of "US Weekly." Nothing takes your mind off your math final like the real issues in Hollywood. And she loves the celeb gossip.

I wrote a nice "good luck" card. Her dad threw in a bit o' cash. That makes any old care package a winner, right? Anyway, it's done and done. At least until May! :-)

How did your finals week go? Did you get a care package to help you through?

Barbara

When you move into a new place, inevitably you find out things about previous occupants. In my move, what I found out was in the mailbox. Judging from all the catalogs I've been receiving, I've gathered that the former resident was probably as obsessed with paper products  as Staci is. And in addition to the junk mail to the former resident, there was some for the former resident's business—a company that files the Free Application for Federal Student Aid (FAFSA)  for its customers.

Being in the student loan industry, this was particularly interesting to me. So I did some digging—remember, I used to be an ace reporter!—and I found out that for just $49.95 they would submit your FAFSA after checking it for errors.

Hold the phone! Who would pay $50 to file a FREE Application for Federal Student Aid? You know, I remember filling out the FAFSA. It was tedious, but never too tough. So I checked to see what the FAFSA folks themselves advised. And here  it is. So in short, save yourself the money and use the free tools and resources if you have questions.

Have any of you used a third party to file your FAFSA?

Editor's note: This month, you might notice that The Student LoanDown team is spending a lot of time talking about the FAFSA. That's because we recommend that you fill out your FAFSA as soon after January 1 as possible.

Caroline

In a post last week from Barbara, she talked about helicopter parents . I've been thinking about the same topic lately, but from the other side of the fence ... wondering if I AM a helicopter parent.

When my stepdaughter was in high school  I know we hovered a bit. Definitely more than parents of my generation did. Her dad and I monitored her grades online and kept up on when she was having tests and quizzes. Was that just responsible parenting, or was it "helicoptering"?

When it came time for college, we pushed for her to visit an out-of-state college "just to see." And we tromped along with all the other parents on the college visit . Were we helicoptering again? I know it's completely accepted—and even expected—today that parents get involved in their kids' college choices and go on college visits. But horror of horrors ... my own parents did not.

But now my stepdaughter is in college. It's time to back off, right? We have ... kind of. We didn't advise her on what classes to take, we aren't emailing her professors, and we're not calling to wake her up in the morning or anything crazy like that. However, when she was looking for a part-time job , I found myself perusing the employment ads for her. We peek at her bank account regularly to make sure she's not running low on funds. Is that helicoptering?

A friend of mine works for a university and supervises student workers. She's got some experience with helicopters. She said some parents seem almost like personal assistants to their college-age children, scheduling their job interviews and such. One parent even turned down an interview on behalf of her daughter. The mom didn't think it sounded like a good fit.

Wow. I can't imagine going quite that far. But I can see how a parent can easily slide across that fine line between "helpful" and "helicopter." I have a 2-year-old. And I try really, really hard to let him put on his own shoes. Even when it takes 15 minutes. Even when they wind up on the wrong feet. But some days I just can't stand it, and I get in there and put 'em on for him.

When your kid gets to be 20 years old, it's still really hard to stand by and watch her put her shoes on the wrong feet—metaphorically speaking, of course.

So, when is it time to back off? What do you think is the line between just being a helpful parent and being a helicopter?

Barbara

So, Staci has already told you about the experience of being my second opinion in my search for a "Barbara apartment." And now, the keys are in my hand—a very exciting Big Girl moment (those keep sneaking up on me).

I was very nervous to move. More than being nervous, I was clueless. The phone at my parents' house rang many times as I was making my decision and compiling my list of possibilities.

In fact, the phone rings at their house a lot! I pretty much don't make a major decision without consulting them first. My job search  ... called 'em. My work benefits  ...called 'em. My cat ... called 'em.

It's not just me. I bet many of you in Generation Y  can relate. Our parents seem to play a larger role in our planning and decision-making than the parents of other generations. We're a little—dare I say it—coddled.

But some parents take their overprotective habits to the extreme —earning them the moniker "helicopter parents." One has to wonder if these kinds of practices help us develop independence or hinder our entry into the adult world.

My parents are not the über -overprotective type, but they are always available when I need them. And sometimes, I need them a little too much. I've developed a dependency that just won't go away even as I near the big 2-3. I can't even imagine what I'd be like had I faced parental units that hovered over my every move.

I'm curious what it's like for you.

Tell me: Are your helicopter parents hovering a little too close? Feel like you have a smother instead of a mother? Or are you happy to be a little bit overprotected?

And parent readers, feel free to >chime in with your experiences.

P.S. Mom, if you ever learn how to use the Internet and read this (or if one of my sisters prints it off for you), rest assured, I don't think you smother me! I value every piece of advice you give me ... even if I don't always take it! :)

Staci

Over Thanksgiving weekend, I did something I hadn't done since 1998: I shopped for apartments.

Not for me. For Barbara!

Now that she is gainfully employed, Barbara has decided to move out of the house she shares with roommates and into her very own Big Girl apartment. She had done some searching on her own but wanted a second opinion, so she asked me to come along and offered to buy me a Cherry Limeade from SONIC®  in return. I was in.

Because of Bill, Barbara needs a place that's cat-friendly. The first place we viewed was affordable, but downright scary—smoke-filled hallways, stained carpeting, and rickety window air conditioners. We decided—pretty much instantly—that wasn't for her.

The second property was more expensive, but with good reason. It had a washer and dryer right in the unit (no communal laundry), an individual entry (no scary smoke-filled hallways), and a garage (no winter car ice scraping). It seemed more like a condo than an apartment, and Barbara was sold.

But in the leasing office, Barbara had a bit of a panic attack. Could she really afford this? My attempts to talk her down from the ledge weren't working, so I decided it was time for her to take a good, hard look at the numbers. I asked the agent if we could borrow a computer and pulled up the budgeting worksheet(PDF) from the Hands on Banking® program. Seriously, I did. Ask Barbara.

After she plugged in all of her expenses—including the commitment to her savings account—Barbara still had $400 left for the month. I think that was a surprise to both of us! But it gave her the confidence to sign her name on the lease. And last weekend, she moved in.

Yep, she's gonna make it after all .

Have you ventured out on your own? >Tell us about it!

Caroline

"No, I won't qualify. My parents make too much money."

Have you ever heard that comment? It's a common misconception. Lots of students and their parents mistakenly assume that all financial aid is based on your income. (Check out Staci's post from a few months ago to see her real-world experience with this.)

Since the time for applying for financial aid is right around the corner, I think it's time to set the record straight.

Here's the deal: Some financial aid is need-based, some is not.

Which financial aid IS based on need? Mostly the "free" money like grants and some scholarships. The subsidized Federal Stafford Loan is also based on need (this is the one where the government pays the interest while you're in school). The Federal Perkins Loan(PDF) is also based on financial need (this loan comes directly from your school).

Which financial aid is NOT need-based? The unsubsidized Federal Stafford Loan (you're responsible for the interest on this loan). Students who are attending an eligible school at least half-time will typically qualify for the unsubsidized Federal Stafford Loan.

And there's another one: The Federal PLUS Loan is also not based on financial need. Parents can take out a PLUS loan to help their dependent undergraduates pay for college. Graduate students can take out a PLUS loan for themselves to help cover their education costs.

With all these financial aid options, it's amazing how many people just don't fill out the FAFSA  (Free Application for Federal Student Aid). While some may think they don't qualify, others think they can handle college costs on their own, and still others may fill out the application but miss key deadlines.

You don't have to take my word for it. Check this out: The American Council on Education published a brief  a couple years ago noting that half of all undergraduates—or approximately 8 million students—in 1999-2000 who attended a college or university that participated in federal student aid programs failed to apply for financial aid.

Lots of these students were from low and moderate income families and would likely have qualified for a Pell Grant . Also, more than half the students who filled out the FAFSA in 1999-2000 did so after important deadlines had already passed, which lowered their chances for getting state and institutional aid.

So what's the message here? If you're interested in getting federal aid to pay for college, don't make assumptions about whether or not you'll qualify, and don't delay in applying. Fill out your FAFSA as soon as possible after January 1 of your senior year, and see what kind of award packages your schools come back with.

Are you planning to fill out the FAFSA this year? If you did so last year, how did things turn out? Did you get the aid you expected?