Short on Cash? Use Your Employer as a ‘Payday Lender’

Posted on October 30, 2018October 25, 2018 by Amrita Jayakumar

If you were in a financial bind, would you turn to your employer instead of a payday lender?

Coming up with cash quickly can be a costly endeavor for the 78% of working Americans who often live paycheck to paycheck. Many turn to payday loans because they’re convenient. But they also carry high interest rates and allow rollovers, trapping many in a cycle of repeat borrowing and indebtedness.

In recent years, startups from Silicon Valley and beyond have stepped up to offer payday alternatives through the workplace. Some, including Earnin and PayActiv, have put a new twist on the two-week pay cycle to give people access to their wages as soon as they’ve earned them. Others, such as HoneyBee, SalaryFinance and TrueConnect, allow employers to offer low-cost emergency loans as an employee benefit.

These startups say that by providing solutions for the two main reasons people take payday loans — to manage cash flow or pay for unexpected expenses — they will eliminate the need for them.

Here’s what you need to know about paycheck advances and emergency loans.

Paycheck advances in the modern workplace

The concept of a paycheck advance is not new — your workplace may already have an informal program that gives you access to money you’ve earned.

What technology companies like Earnin and PayActiv say they offer is a streamlined approach for employees that retains the employer’s traditional two-week pay cycle.

“If we can watch movies in real time, why can’t we get access to our income in real time?” says Ijaz Anwar, co-founder and COO of PayActiv, based in San Jose, California.

Earnin, based in Palo Alto, California, has a mobile app that asks for your time sheet and lets you cash out a portion of the money you’ve earned before your pay date. The company asks for an optional “tip,” which is deducted from your regular paycheck.

PayActiv integrates with your employer’s payroll system to offer a similar app-based service that sends earned wages to a bank account or prepaid debit card. The company, which counts Walmart among its clients, charges employees a flat membership fee of $5 that includes three chances per month to withdraw pay. It also offers financial counseling and budgeting tools.

The typical user makes between $11 and $13 an hour and is in their mid-30s, Anwar says.

Emergency loans through your employer

HoneyBee, SalaryFinance and TrueConnect provide small personal loans for emergencies, typically between $250 and $3,000, through an employer’s benefits portal.

All three companies say they look at employment and income data to underwrite borrowers instead of traditional credit information, so a low credit score won’t automatically disqualify you. They also report payments to the credit bureaus, which can help your score.

It’s not only low-income workers taking such employer-provided loans. Workers at all salary ranges have cash-flow issues at some point or another, says Doug Farry, one of the founders of Employee Loan Solutions, the company behind TrueConnect.

The TrueConnect program was originally meant for lower-income workers, Farry says, but even people making six-figure salaries use it. Comcast is one of the company’s better-known clients.

The interest rates on these loans are significantly lower than those on payday loans, which can be as high as 400%. TrueConnect has a one-size-fits-all rate of 24.9%, HoneyBee charges an upfront fee of 5% of the loan amount, and SalaryFinance charges 11.8%. Payment terms span from a few months to a year. Monthly loan payments are deducted from the employee’s paycheck.

These loans work like any form of credit — as long as you make on-time payments, your credit improves. If you lose your job, you’re still responsible for loan payments, although the companies say they will work with borrowers in that situation.

In keeping with their mission to help people manage money, they also offer financial education resources.

Pros and cons

The biggest advantage of paycheck advances or emergency loans is access to money at a low cost, regardless of your credit situation. They’re one option in an array of alternatives to payday loans, depending on your need. Others include payday alternative loans from credit unions, pawnshops and lending circles.

But these services aren’t a silver bullet if you have chronic spending problems, low income or a lot of debt. You may be better off creating a budget, exploring ways to make more money, or using a strategy to pay off debt.

The article Short on Cash? Use Your Employer as a ‘Payday Lender’ originally appeared on NerdWallet.

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4 Ways to Save on Housing Costs in Your 20s

Posted on October 25, 2018October 23, 2018 by Steve Nicastro

Young adults paying off student loans or saving for their first home won’t soon reach their financial goals just by cutting out Starbucks or canceling their gym membership. A faster way to save money is to trim housing expenses.

Here are four ways to save on housing and free up money to pay off debt, save for a down payment or fund other life events.

Live with your parents

It may not be as fun as living with friends, but you’re not alone if you live with Mom and Dad. A third of adults ages 18 to 34 lived with parents in 2015, according to the U.S. Census Bureau.

The savings can be significant. The median monthly gross rent in the U.S. in 2017 was $1,012, according to the Census. Assuming you can live at home and save that amount each month, you could save more than $24,000 in two years.

Sit down with your parents to see how much they expect you to contribute. For example, paying reduced rent and a portion of the monthly bills may be a fair deal. It’s also an opportunity to create a budget and establish some financial independence.

Head to the burbs

If living at home isn’t an option — or if it’s driving you crazy — sacrifice living in the most desirable areas, where rent is typically the highest.

Scott Trench shared a two-bedroom apartment outside of Denver in 2013. The monthly rent of $550 — almost half what he would have paid in the city with a roommate — helped Trench save enough to buy his first house in 2014.

“If you want to have fun, you can spend an extra $50 a week” to get downtown, says Trench, 28, president of BiggerPockets, a real estate education company.

Living in the suburbs works best in cities with access to cheap public transportation, especially if you work downtown. Compare housing options using resources like Trulia, Zillow and Craigslist, factoring in rental plus transportation costs.

Negotiate your rent

If you’re a model tenant and your lease is coming up for renewal, ask your landlord for a better deal. If you don’t plan to move, you could request a longer lease in exchange for lower rent.

Consider the value you bring to negotiations, too. If you’re handy and your landlord allows it, offer to do small jobs around the property such as painting or repairs in exchange for discounted rent. You might also get a break by sending referrals to your landlord’s other properties, or by negotiating a free parking space or extra storage.

Gain negotiating confidence by coming prepared: Research rents of comparable places in your area before you approach your landlord.

Rent out your place

As you prepare for homeownership, you can plan to keep saving by ”house hacking” — buying a house and renting out the spare bedrooms, earning enough to cover your housing expenses.

Trench purchased a duplex and rented out a spare bedroom in his unit for $550 a month. He rented out the other unit for $1,150. When factoring in all monthly expenses, his housing costs were often zero, he says.

House hacking comes with risks like damage to your property. Carefully screen tenants using credit checks, background checks and references to reduce those risks, Trench says.

Be sure to study rental laws, and consult with a tax professional for advice on reporting rental income on your taxes.

The article 4 Ways to Save on Housing Costs in Your 20s originally appeared on NerdWallet.

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How to See the World in Your 20s Without Racking Up Debt

Posted on October 23, 2018October 23, 2018 by Claire Tsosie

It’s a dilemma many 20-somethings face: You badly want to travel the world. But if your bank account could talk, it would say, “Are you kidding?”

When you’re just starting out, even a weeklong vacation might seem like a one-way ticket to credit card debt — especially if you have a modest income or lack access to paid time off. But with the right moves, you can budget for travel without going into the red.

Start saving

For Krista Aoki, the key to avoiding debt while traveling is simple: Save.

Before a big trip, “I try to always start with a big cushion. I always save up beforehand, and I try to save up more than I need to,” says Aoki, 26, an online business manager who does consulting and virtual assistant services for other online businesses. She estimates it takes her about three months to save up for a big trip. She now travels full time and is currently in Kealakekua, Hawaii.

To save for travel, she spends less on other items, such as clothes. She also hasn’t owned a car in 2½ years and often relies on public transportation.

You might not be able to pay for a vacation in full right this second. But that doesn’t mean you need to choose between taking on credit card debt or being a hardcore homebody. By spending less in certain areas now and setting aside money consistently, you might have enough to cover a small getaway in a few months.

Decide where to minimize costs

The best vacation isn’t necessarily the most expensive vacation. By aggressively reducing your basic costs — flights, transportation, lodging, food — you might be able to squeeze in more exploring for a smaller price.

Instead of booking hotels, for example, you might opt to stay at hostels, which are more like college dorm rooms. Often, staying in a hostel means sharing a room and bathroom with others and sleeping in bunk beds rather than on queen-size mattresses. But they’re a good way to meet other travelers and can be startlingly cheap.

“A nice co-working hostel in Chiang Mai in Thailand is like $10 a day,” says Aoki, who says she spends most of her time in Thailand. “I’ve been to two, and they’re really clean and pretty comfortable, and they include breakfast and a working office.” If you’re willing to sacrifice some privacy, staying at one might make it easier to pay your credit card bill in full when you return from your trip.

Use credit card rewards

When Leah Gervais was 24, she traveled in Southeast Asia for four months without going into debt, in part by using credit card rewards to pay for her flights.

“It’s not that I had a lot of savings ready to go,” says Gervais, now 26, founder of lifestyle website Urban 20 Something. “What I did have was a lot of frequent flyer miles.” She got the miles in college by earning sign-up bonuses on airline credit cards; she didn’t carry balances on them. With those miles, she was able to fly from New York City to Siem Reap, Cambodia, and back to New York City from Bangkok for just the cost of taxes and fees. (She paid cash for other shorter flights she took throughout Southeast Asia, which were quite affordable, she says.)

If you’ve been using a rewards credit card, log on to your online portal to tally your miles or points. It might be enough to cover part of your trip.

Make money while traveling

Both Aoki and Gervais have something in common: They work while they travel. That gives them flexibility to visit more places and stay on the road longer.

“I started doing some freelance writing work while I was [in Southeast Asia],” Gervais says of her four-month trip, noting that the cost of living in Cambodia was significantly lower than it is in Manhattan, where she lives. On that trip, she also worked as a bartender for a short time. Because she was traveling frugally, her income from these jobs was enough to support her abroad.

If traveling is a priority, look for jobs that can be done remotely, such as freelance graphic design or writing. Or consider jobs that require you to take business trips. Working while traveling isn’t exactly “vacation,” but it’s a financially sustainable way to satisfy your wanderlust. While you’re exploring, you can make sure money’s flowing into your bank account faster than it’s flowing out.

This article was written by NerdWallet and was originally published by The Associated Press.

The article How to See the World in Your 20s Without Racking Up Debt originally appeared on NerdWallet.

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$2.6B in Free College Money Went Unclaimed by 2018 Grads

Posted on October 18, 2018October 23, 2018 by Anna Helhoski

High school graduates who didn’t complete a federal financial aid application missed their opportunity for part of $2.6 billion in free money for college, according to NerdWallet’s annual analysis of federal financial aid data.

The money went unclaimed by 661,000 members of the Class of 2018 who were eligible for a federal Pell Grant but didn’t complete the Free Application for Federal Student Aid, or FAFSA. The application is key to getting money for college including work-study, federal loans and aid from states and schools.

The average Pell Grant was $3,908 for the 2018-19 school year, NerdWallet found. The maximum allowable award for the year was $6,095.

Who gets a Pell Grant

Pell Grants are awarded to students from lower-income families. The amount awarded is based on the cost of attendance at a student’s school and information provided through the FAFSA, including a family’s financial need. Students can receive a Pell Grant for up to 12 semesters, or about six years, but they must submit an application each year to qualify.

The total Pell Grant money awarded to college students for 2018-19 was $27.5 billion, which was distributed to over 7 million students.

Among 2018 graduates, more than half were eligible for a Pell Grant, according to federal financial aid data from the Florida College Access Network.

States where students compete for the funds

Tennessee and Louisiana tied for the lowest percentage (17%) of high school graduates who didn’t complete their FAFSA, according to NerdWallet’s analysis. Both states are taking steps to make sure even more students complete their FAFSA.

In Tennessee, the state higher education commission hosts “FAFSA Frenzy” events annually to improve the rate of completed applications, which are required for the state’s free community college program called Tennessee Promise.

Louisiana’s state office of student financial assistance hosts FAFSA completion and correction events, along with a competition among schools to encourage finishing the applications. The state also requires high school seniors to complete a financial aid application or sign a waiver to receive their diploma.

States where students miss out

But states’ completion efforts are often no match for other deeply rooted factors.

More than half of high school graduates in Utah (55%) and Alaska (52%) didn’t complete the application for 2018-19. Both states carry out completion awareness campaigns, but the unique makeup of their populations stymie broader efforts, officials say.

Many graduates in Utah are members of the Church of Jesus Christ of Latter-day Saints and serve two-year religious missions before applying for college or financial aid. About two-thirds of students in Utah are Mormon and about half go on missions, says David Buhler, commissioner of the Utah System of Higher Education.

The commission hosts over 100 FAFSA completion open houses statewide and promotes applying for financial aid before heading off to missions — to make the renewal process easier when they return — but it’s not having the impact officials had hoped.

“Their focus is on getting ready for a mission — young men in particular — and college is ‘something I’ll deal with later,’” Buhler says. “It’s against human nature expect a late teen to do something like this before they have to. But we do encourage it.”

In Alaska, Rebekah Matrosova, director of outreach and early awareness for the Alaska Commission on Postsecondary Education, says the data may be underreported due to the number of small, rural schools throughout the state.

However, Matrosova also says College Goal Alaska, the state’s FAFSA completion awareness initiative, tries to reach as many of those communities as possible.

“A lot of it comes down to awareness not being there, or the misconception that the FAFSA is only for certain people from certain backgrounds when it is something that everyone can benefit from,” Matrosova says.

Why students don’t apply

Among all high school graduates, 37% didn’t complete the FAFSA, according to NerdWallet’s analysis. Why?

The biggest misconception is families think they won’t get any financial aid, says student loan expert Kevin Fudge. In reality, all families qualify for federal student loans and most will qualify for some other kind of aid.

Parents also could be reluctant to share their financial information for privacy concerns, says Fudge, the director of consumer advocacy and ombudsman for American Student Assistance, a national nonprofit dedicated to helping students achieve education and career goals.

Other students may start the FAFSA, but don’t finish it or make a mistake that eliminates them from receiving aid. For example, in Alabama, students submitted 33,266 applications, but 30,379 were approved.

How to make sure you don’t miss out

To complete the FAFSA, go to the federal student aid website at Studentaid.ed.gov. In addition, this year the Federal Student Aid Office launched a new mobile app, myStudentAid, to encourage higher rates of completion. However, only new college students can use it for the 2019-20 school year.

The article $2.6B in Free College Money Went Unclaimed by 2018 Grads originally appeared on NerdWallet.

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Got Debt? Get a Side Hustle

Posted on October 16, 2018October 12, 2018 by Steve Nicastro

If you’ve got debt and a main job that covers your regular monthly expenses, aim to apply earnings from side hustles directly to your debts.

Flexible side hustles that are worth your time do exist (and we’re not talking about pyramid schemes or online surveys). There are legitimate options to help pay off debt. And the extra income can be meaningful: Pay an additional $250 per month toward a $10,000 credit card balance with a 20% annual percentage rate and you’ll save over $9,000 in interest and pay off the balance almost seven years faster.

Here are some ideas and tips to get started.

Rideshare drive or delivery

Potential monthly earnings: Up to $300 or more, depending on location and how many hours you work.

Flexible hours make rideshare driving with Uber and Lyft a popular side hustle for people who own or have access to a car.

Uber drivers earned an average of $364 a month, while Lyft drivers made $377 each month, on average, according to a 2017 study of thousands of online loan applications by Earnest.

If you aren’t comfortable driving strangers, an alternative is to use your car to deliver items with companies like Roadie, which matches drivers with stuff bound for their destination. Pets, furniture and lost luggage are just a few items that can be delivered.

Earnings range from $8 to $650, depending on the trip distance and size of delivery, says Marc Gorlin, Roadie founder and CEO.

Delivering packages via Amazon Flex could be a lucrative side gig, with drivers earning $18 to $25 an hour, according to the company, and it operates in about 35 regions nationwide, including some major metro areas plus smaller cities.

Tutor or teach

Potential monthly earnings: $200 to $1,000, depending on experience.

Tutoring can be an option for teachers, professors or those with expert knowledge they can share. Startup costs are typically limited to books and other supplies.

Teachers have a leg up in tutoring for tests like the SATs, since they already know how to prepare students, says Gabriel Kaplan, founder of Wealth Habits, a financial planning firm in New York.

Telecommuting can expand your potential customer base. Remote tutoring jobs are listed on sites such as FlexJobs and SimplyHired.

Freelance

Potential monthly earnings: $200 to $500 or more, depending on experience and clientele.

Freelance blogging, proofreading or editing are popular gigs for wordsmiths, while graphic design and music composition may appeal to artists.

If your passion is photography, income opportunities may include taking pictures at weddings and graduations and doing family portraits.

These side hustles can be found on job boards such as Indeed, Remote.Co or ProBlogger, or at freelance sites such as Fiverr.

Startup costs and time requirements could be on the higher side with these gigs. You’ll need the right equipment, a strategy for getting clients and ideally a website to market your services.

Rent or sell your stuff

Potential monthly earnings: Up to $1,000 for short-term home rentals in popular travel destinations; $100 to $300 or more for car rentals, depending on location.

Things you already own can create passive income. For example, you can rent your car via sharing marketplaces such as Turo or Getaround, which operate in many larger cities.

You can rent your home, apartment or a guest room through Airbnb or HomeAway. Check local laws because some cities restrict short-term rentals.

Sell unused items on eBay, Craigslist or specialty sites like ShareGrid, where you can rent or sell camera equipment.

Side hustle considerations

Set debt repayment goals. Seeing how much interest you’ll save by repaying debts early can motivate you to continue your side hustles. Track your debts on a spreadsheet or a budgeting app and check your progress monthly.

Match up skills to the hustle. Find something you’re good at and enjoy, says Chad Rixse, co-founder and financial planner at Millennial Wealth, in Seattle.

Don’t jeopardize your 9-to-5 job. Consider the time commitments of the side hustle, and check if you have a noncompete agreement, which may prevent you from working a gig in a similar field.

Obtain permits or licenses. For example, contractors may need a business license to work on houses, while fixing up and reselling items online may require a sales tax license, says Dwight Dettloff, a CPA and financial planner for Winding Trail Financial Planning, in Lafayette, Colorado.

Get insurance. You may need liability insurance for side hustles where there’s risk of being sued, Rixse says. Short-term house rentals and renting equipment are a few examples. You may also need rideshare insurance if your car insurance policy doesn’t cover it.

The article Got Debt? Get a Side Hustle originally appeared on NerdWallet.

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How to Pay for College When You Haven’t Saved Enough

Posted on October 12, 2018October 12, 2018 by Liz Weston

If college tuition bills are looming and you don’t have nearly enough saved, you have plenty of company. But you also have options for making it more affordable.

Four out of 10 families who hope to send kids to college aren’t saving for that goal, according to student loan company Sallie Mae. Among those who are, parents of children aged 13 to 17 have saved an average of $22,985.

That’s not enough to pay for the typical college education out of pocket. The net average cost for a year of college, after scholarships and grants were deducted, was $15,367 in 2017, according to Sallie Mae. That means a four-year degree is likely to cost over $60,000. The expense can, of course, be much higher since many elite schools now charge $70,000 a year or more.

Here are some steps to take now to secure an affordable education — and avoid crushing debt.

Set borrowing limits

The federal PLUS loan program allows parents to borrow the full price of virtually any college education. That’s rarely a good idea. It’s much smarter to decide before applying for schools how much parents can and want to contribute. In general, parents should limit borrowing to what they can afford to pay off before retirement, while still being able to save for that retirement.

It’s also reasonable to ask the student to first exhaust federal student loan options before parents consider borrowing. Students typically can borrow up to $5,500 in federal student loans for their first year of college and a total of $31,000 for an undergraduate education.

Apply to financial ‘safety,’ ‘target’ and ‘reach’ schools

College counselors typically recommend applying for three types of schools, based on the student’s academic credentials: “safety” schools virtually certain to say yes, “target” colleges likely to accept them, and “reach” options where acceptance is a long shot.

Families also should also include at least one financial “safety” school — a college with costs they know they can handle — as well as “target” schools that could be affordable and a “reach” school that may surprise them with generous financial aid. The net price calculators available on every college’s site can help identify likely candidates.

Consider alternatives

Not every career requires a four-year degree. For those that do, a year or two of community college can significantly cut costs but also may increase a student’s risk of dropping out. Community college may be best for self-motivated types who are determined to get a degree and who can do the legwork in advance to ensure their credits will transfer to the desired four-year institution.

For kids who aren’t that motivated or are unsure what they want to study, a gap year may be a good option. They’ll have another year to grow up and get focused, without racking up college expenses. They could even get a job to pay some of those costs.

Speaking of motivation:

Encourage focus

It’s a lot to ask 17- and 18-year-olds to decide what they want to do for the rest of their lives. Dithering is expensive, though. Most colleges have career counselors who can help students sort through their options, and internships can offer real-world glimpses of future career paths.

Trim expenses and tap assets

Cutting discretionary expenses can free up more money for college bills. The usual suspects: eating out less, buying used instead of new, vacationing cheaply, combing your bills for “leaks” such as memberships or subscriptions you’re not using. If your student is attending college more than 100 miles away and won’t have a car, your auto insurer may give you an away-from-home discount.

Tax breaks, such as the American Opportunity or Lifetime Learning credits, also may help make ends meet. Withdrawals from 529 college savings plans typically are tax-free when used for qualified education expenses.

Selling nonretirement investments and other assets can help pay for college while possibly increasing financial aid in future years. (While federal financial aid formulas typically ignore retirement funds, money in savings and brokerage accounts reduces need-based aid.) Consult a tax pro first, since asset sales can have tax consequences.

Don’t pause retirement contributions, however. You can’t get back the tax breaks and company matches you’ll lose, or the future tax-deferred earnings that money could have earned. Retirement is even more expensive than a college education, and few of us can afford to stop saving for that goal.

This article was written by NerdWallet and was originally published by The Associated Press.

The article How to Pay for College When You Haven’t Saved Enough originally appeared on NerdWallet.

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When a Little Student Debt Becomes a Lot of Trouble

Posted on October 9, 2018October 9, 2018 by Brianna McGurran

“Ask Brianna” is a column from NerdWallet for 20-somethings or anyone else starting out. I’m here to help you manage your money, find a job and pay off student loans — all the real-world stuff no one taught us how to do in college. Send your questions about postgrad life to askbrianna@nerdwallet.com.

Stories about student loan borrowers with six-figure debt loads might shock us, intrigue us or appeal to our deep-seated sense of financial schadenfreude. But borrowers with very high balances, for the most part, are not the ones to worry about.

Those who owe less than $5,000 are.

That’s because they’re most likely to fall behind. Almost a third of them who began repayment between August 2011 and August 2012 defaulted within four years, according to an analysis by the Urban Institute, a nonprofit research organization. Just 15 percent of borrowers who owed $35,000 or more defaulted on the same timeline.

Borrowers with a small amount of student debt are more likely to have left school without degrees, affecting their employment options, earnings and ability to repay. Attending for-profit schools with poor job placement rates and having other, non-student debt to manage also put borrowers at risk.

Simply keeping your student loan balance low isn’t a defense against default. All your education-related choices — what school you go to, what you study, what you do after graduation — affect whether you’ll get those loans off your back. Here’s how to keep a little debt from turning into a lot of trouble.

Choose a school carefully

Defaulting on student debt means you’ve missed nine months of payments on federal loans — often fewer than that for private loans.

Avoid default at all costs.

It can wreck your credit and, for federal loans, lead to withheld paychecks, Social Security checks and tax refunds. With poor credit, you’ll have a harder time qualifying for a mortgage or auto loan; you may even have to pay a deposit to set up utilities in your home.

One of the biggest steps in achieving the financial stability needed to avoid default is simply to graduate — and your chances of graduating are much worse if you go to a for-profit school. Compared with students at two- and four-year public and private colleges, those at for-profits are the least likely to get a degree within six years, and they earn the least 10 years after starting school, according to an analysis by the now-closed Center for Analysis of Postsecondary Education and Employment.

Almost half of students who started attending for-profits in 2004 defaulted on their student loans within 12 years, according to a report from the Brookings Institution, a nonprofit public policy organization.

When researching colleges, use resources like the U.S. Department of Education’s College Scorecard to view graduation rates and average salary after attending. Steer clear of schools that aren’t forthcoming about whether they’re accredited or licensed to operate, pressure you to enroll, or advise you to take out private student loans or borrow up to the full cost of attendance without sharing other options.

Tie your debt load to your major

Your chosen major will also affect how much money you earn. Make sure the school and the specific program of study will prepare you for a well-paying job in your industry. Ask students and alumni at the schools you’re considering how much job-search support they received.

Finally, borrow the least amount you can manage while still covering your expenses while in school. Dropping out due to financial stress can also hurt your chances of getting a stable job.

The Bureau of Labor Statistics’ Occupational Outlook Handbook is a good place to start researching your likely salary after graduation. Use that expected salary to determine how much to borrow. An affordable monthly loan payment is 10 percent or less of your after-tax income once you start working.

Payments you can handle will keep your bills on track — and won’t leave you asking whether college is worth it.

This article was written by NerdWallet and was originally published by The Associated Press.

The article When a Little Student Debt Becomes a Lot of Trouble originally appeared on NerdWallet.

Black Friday Is Coming. Here’s What Not to Buy Until Then

Posted on October 4, 2018October 2, 2018 by Courtney Jespersen

In a year when online competition is fierce and brick-and-mortar shops are struggling, major retailers are likely to come out swinging this Black Friday.

Ron Kuntze, a professor of marketing at the University of New Haven in Connecticut, thinks Black Friday 2018 will be big for consumers — big, that is, when it comes to savings and customer service.

To maximize your odds of finding low prices, some deals are worth waiting for until Nov. 23. Based on past sales, here’s what to hold off buying until Black Friday — and what to do if you can’t wait that long.

Don’t buy electronics

We can’t know for sure what deals are coming this year, but in general it’s in your best interest to wait until Black Friday to shop for electronics (or Thanksgiving Day, when many sales actually start).

1. TVs

Black Friday has long been one of the best times to buy a TV. Last year, a 39-inch smart TV was $125 at Walmart. Amazon sold a 49-inch 4K TV for $159.99.

Kuntze says low-priced TVs sell out fast on Black Friday, but some stores continue to honor the sale price online or offer a similar deal on a similar TV. Just keep in mind that TVs with the biggest discounts will likely be models that haven’t sold as well as expected.

2. Smartphones

Smartphone promotions abound on Black Friday. Kuntze says retailers know you’re likely to buy a lot of extras when you purchase certain electronics, such as phones. So they’re hoping you’ll pick up accessories like cases and chargers, too.

3. Video game consoles

You can usually find video games and video game consoles on the first few pages of Black Friday ads, especially from stores like Target and Best Buy. Retailers have been known to offer all-in-one bundle deals that contain a console, controller and sometimes a game.

But you don’t have to stop shopping

Black Friday is nearly two months away; plenty of other sales will happen between now and then.

If you can’t wait until late November to buy something, or simply don’t want to shop on Black Friday, don’t feel pressured to do so. In fact, Kevin McIntyre, a professor of economics at McDaniel College in Maryland, thinks you shouldn’t wait until Black Friday to buy anything.

“Black Friday is ferociously competitive still, but I’m not convinced that there are any savings to be enjoyed on Black Friday that are unique to late November,” McIntyre says.

He says there are deals to be had throughout the year, so if you see a good sale in the next couple of months, go for it.

If you want to avoid the pressure of finding the best deal altogether, just look for a deal that’s “good enough,” says George John, a professor of marketing at the Carlson School of Management at the University of Minnesota.

Determine what a product is worth to you, and if you see it reach that price, buy it.

The article Black Friday Is Coming. Here’s What Not to Buy Until Then originally appeared on NerdWallet.

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Ready to Apply for College Aid? A New App’s on Tap

Posted on October 2, 2018October 2, 2018 by Anna Helhoski

Students can now apply for federal financial aid the same way they share snaps and stories: through an app on their phones.

The myStudentAid mobile app from the U.S. Department of Education lets students and parents fill out and submit the Free Application for Federal Student Aid, or FAFSA. The new app launched Oct. 1, the opening day for submitting the FAFSA for the 2019-20 academic year.

The results of the FAFSA determine a student’s eligibility for grants, scholarships and work-study. It’s also the key to accessing federal student loans. Students must complete a FAFSA for each year they’re in college to receive financial aid.

“We’re hoping that the availability of the app really attracts students since students are so centered on doing all of their tasks on their phone,” says Kim Cook, executive director of National College Access Network. The organization, a nonprofit dedicated to improving access to college for first-generation, underrepresented and low-income students, tested the app’s beta version earlier this year.

The application questions are the same, though now they appear one screen at a time. Cook says students responded positively to the simplified format during NCAN’s testing.

What myStudentAid can and can’t do

MyStudentAid isn’t without its limitations. According to the Department of Education, you’ll still need to use the FAFSA website for certain functions. For now, the app is only available to first-time 2019-20 applicants, so you can’t file a renewal application if you’re currently in college. You also can’t file a correction through the app if you make a mistake or need to amend your form after submitting it.

You can start your application online and finish it on the app, or vice versa. The app promises a customized experience for users, depending on whether you’re a student, parent or third-party application preparer. Using myStudentAid, you can:

Manage your FSA ID and password.
Use the myCollegeScorecard feature to compare colleges’ graduation rates and average student debt per graduate.
Ask Federal Student Aid representatives questions about your application.
Use the IRS Data Retrieval Tool to transfer federal tax return information to the form.
Access federal student aid history using the myFederalLoans feature.
Get financial aid information directly from the Federal Student Aid website through the app.

Residents of seven states — Iowa, Minnesota, Mississippi, New Jersey, New York, Pennsylvania and Vermont — may also transfer FAFSA information into their state aid application using the mobile app.

How submitting the FAFSA early benefits you

The deadline for the 2019-20 FAFSA is June 30, 2020. But the sooner you submit, the better the chance you have to secure first-come, first served aid such as Pell Grants and work-study that will help limit how much you need to borrow in student loans.

Before you apply, prepare to complete the form with less stress by having all the documents you need at your fingertips. This checklist can help.

The myStudentAid mobile app is available now for iOS and Android devices.

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The article Ready to Apply for College Aid? A New App’s on Tap originally appeared on NerdWallet.

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