Grads Left Behind $3.75B in Free College Aid in 2021, Study Says

High school graduates are forgoing free money for college by not submitting financial aid applications, according to a new analysis by the nonprofit National College Attainment Network.

The Class of 2021 left behind $3.75 billion in Pell Grant aid by not completing the Free Application for Federal Student Aid, or FAFSA. An estimated 813,000 students were eligible for the Pell Grant — the largest federal grant program offered to undergraduates — but didn’t submit an application for federal student aid, according to NCAN.

“This quantifies exactly how much opportunity, in the form of forgone Pell Grants, students are leaving on the table,” says Bill DeBaun, director of data and evaluation at NCAN. “It’s another component of showing how dire the college-going situation is in the U.S. right now.”

The findings of the analysis are estimates only; it assumes all high school grads who are eligible for financial aid would submit an application and attend college directly after high school. Nonetheless, the analysis does show that a large number of students aren’t submitting the FAFSA, and if students aren’t submitting it, it’s unlikely they’re enrolling in college, DeBaun says. That can have countless long-term impacts, he added.

FAFSA completion rates are declining

The pandemic’s impact on FAFSA completion is one of the reasons $3.75 billion went unclaimed.

“A huge part of it is the FAFSA is complicated, and students from all walks of life really need support to get through the process,” says Traci Lanier, vice president of external affairs at 10,000 Degrees, a nonprofit college access organization that supports students before and after enrolling in college.

The pandemic forced much of that support to go virtual, Lanier added, and assisting students over one-on-one video conferencing proved to be a challenge compared with large groups that could gather and learn before the pandemic.

In 2019, 61% of high school graduates submitted the FAFSA, while in 2021, an estimated 53% had submitted the application by June 30, according to NCAN. College enrollment has dropped during the pandemic, along with FAFSA completion.

Since fall 2019, there has been a 5.1% drop in enrollment, which translates to nearly 1 million fewer students enrolled in college now than before the pandemic, according to estimates from the National Student Clearinghouse Research Center.

“This is not a hiccup, this is not a blip in college-going,” DeBaun says. “This is a real trend, and it is something that has and is going to keep having real implications on students’ individual finances, on their family’s finances, community’s finances, and then of course, local, state, and national revenue.”

Some state policies have increased FAFSA completion rates

The states with the highest FAFSA completion rates include Louisiana and Tennessee. In 2021, Louisiana had a completion rate of 68%, and Tennessee saw a rate of 71%, according to NCAN’s estimates. Both states have policies that incentivize students to complete the FAFSA.

On the other hand, there are 16 states that have completion rates below 50%, and in the two states with the lowest completion rates, Utah and Alaska, just 37% of high school graduates in 2021 submitted the FAFSA.

Louisiana made submitting the FAFSA a requirement for graduating high school in 2016, and completion rates jumped 10 percentage points in the first year the policy was implemented, says Peter Granville, a senior policy associate at The Century Foundation, a progressive, independent think tank. In Tennessee, students complete the FAFSA at such high rates due to incentives including free community college, Granville says.

“It is implicit in the [mandatory FAFSA] policy that everyone should have a chance to go to college,” says Granville. “I think it has the potential to do a great job starting conversations between students and their schools and their families about going to college and paying for college.”

Submitting the FAFSA is key to paying for college

Each Pell-eligible student in the Class of 2021 who didn’t submit the FAFSA missed out on an average of $4,477 nationally, NCAN estimates.

The Pell Grant is awarded based on demonstrated need, most often to lower-income students, but there is no income limit. The total award depends on details shared in the FAFSA as well as the cost of attendance of the school you plan on applying to.

For students in the Class of 2021 who didn’t submit the FAFSA, 44% said they didn’t do so because they didn’t think they’d qualify for aid, according to student loan lender Sallie Mae’s 2021 “How America Pays for College” study.

If you’re considering pursuing higher education this fall:

  • Even if you’re unsure whether you’d qualify for financial aid, you should still complete the application, as not all aid is based on demonstrated need.
  • You don’t need to know where you’re going to school before completing the application; rather, you just need to provide the names of the institutions you’re considering.
  • It’s best to submit the FAFSA sooner rather than later as some aid is disbursed on a first-come, first-served basis.

Colin Beresford writes for NerdWallet. Email:

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How to Crush Your Holiday Debt

The holidays have left without a trace. Well, almost. Long after the decorations have come down, you still have debt hanging around.

Don’t let it put a damper on your year. Here’s what you can do to take control of your holiday debt.

Review what you owe

First, gather a few important details about your debt. Make a list of your accounts for each type of debt you have. Perhaps you spread holiday purchases across a couple of different credit cards and a “buy now, pay later” loan, for example.

For each debt, note how much you owe, the minimum payment amount, interest rate and payment due date. Staying organized can prevent bills from sneaking up on you.

Then, look closely at the receipts from your holiday purchases, says Bruce McClary, senior vice president of communications for the National Foundation for Credit Counseling. “Compare those with what’s listed on your credit card statement to make sure that you’re accurately being charged and there are no errors that could end up being costly,” McClary says.

Fit it into your budget

Figure out how much you can afford to pay toward debt each month. The 50/30/20 budget is one framework you can use to balance your debt with your income and other expenses. With this rule, 50% of your monthly income goes toward necessities, 30% goes toward wants and 20% goes toward savings and debt repayment.

You can also use budget apps like Mint and You Need a Budget to automatically track your spending by category, says Jeff McDermott, a certified financial planner in Saint Johns, Florida.

“That just gives somebody a baseline to get a sense of, ‘What do I normally spend? What sort of cash flow should I have to start paying down some of this debt? Are there things that I’m overspending on that I should be able to reduce a little bit to free up some cash to attack the debt?’” McDermott says.

Pick a payment strategy

Once you have a solid understanding of how much you owe and what your budget is, make a repayment plan. You’ll pay off your holiday debt sooner if you make more than the minimum monthly payments.

McClary suggests using online debt calculators or tools to estimate your debt-free date. “You can test out strategies of adding different amounts to the minimum payments to see how quickly it would pay off.”

If you’re unable to pay beyond the minimum on multiple debts right now, it’s OK to tackle it one at a time. There are two main methods for prioritizing repayment: debt snowball and debt avalanche.

With debt snowball, you pay extra on the debt with the smallest balance first, while making the minimum payments on others. Once you’ve erased that debt, roll the amount you were paying into paying off the next-smallest debt, and repeat. With debt avalanche, you focus on the account with the highest interest rate first.

“The avalanche, where you attack the highest-interest rate debt first, usually makes the most logical sense. It’s the best from a math standpoint,” McDermott says. “The one disadvantage to that: It can sometimes be hard to feel like you’re making progress if that particular card is really high.”

Which method is right for you? Pick the one that you’re going to feel more motivated to stay on track with, McDermott says.

Explore ways to ditch your holiday debt faster

Here’s what you can do to speed up the debt repayment process:

  • Consider consolidation. Debt consolidation combines multiple debts into one payment, typically through a personal loan or balance transfer card. This approach can make your debt easier to manage, and could reduce the overall interest rate you’re paying on it. Usually, you’ll need a good or excellent credit score. Before applying, McClary suggests obtaining a copy of your credit report and checking your credit scores to get an idea of whether you’ll qualify.
  • Negotiate with creditors. Picking up the phone can also pay off. “If you think the interest rate you’re being charged is not the best rate you could qualify for right now, have that conversation with your credit card company and see if there’s a lower rate that they can give you or better terms on the card,” McClary says.
  • Scrounge up extra money. An increase in income gives you the flexibility to pay down debt faster. You can earn money on the side (say through a dog-walking gig or cash-back app) or use a windfall, such as a tax refund.

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

Lauren Schwahn writes for NerdWallet. Email: Twitter: @lauren_schwahn.

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5 Reasons Why ‘Shoulder Season’ Is the Best Time to Travel

In many ways, travel in 2021 was more challenging than it was in 2020. While demand for travel returned, sufficient hospitality staffing often did not, leading to long waits at airports, hotel check-in desks and restaurants.

The eye-catching travel deals seen in 2020 mostly faded away, making way for price increases, like soaring rental car prices. Despite social distancing recommendations, travelers often found themselves in bigger crowds than ever. Mobs clamoring around airline customer service counters to rebook canceled flights left people barely six inches apart — let alone six feet.

This year might bring similar challenges for travelers, but here’s a good way to skirt most of them: Travel during “shoulder season.”

The definition of shoulder season varies by destination, but it typically means the period of time between a region’s peak season and offseason. This timespan can last months or just weeks. For instance, if a place’s peak season is summer and its offseason is winter, then the shoulder season would be spring and fall. Alternatively, a place may experience peak travel during a holiday weekend, but demand will drop off the weekend before or after — these times can also be considered shoulder season.

Here are five reasons why shoulder season is the best time to travel, especially during the pandemic.

1. Expect to pay lower prices than for peak season travel

Airfares averaged 23% cheaper when booked for shoulder season versus peak season travel. That’s according to a NerdWallet analysis conducted in December 2021 of more than 100 airfares taken from the most popular routes in the U.S. across eight major airlines.

The same routes were compared for flights booked for peak versus shoulder season days, where peak season flights were those booked for the Monday before or after a major holiday. In contrast, the shoulder season flights were those taken two weeks before or after that date.

The difference was starkest around Christmas: Flights averaged 50% cheaper when booked for Monday, Jan. 10, versus Monday, Dec. 27.

2. You won’t compete as much for coveted reservations

Those higher flight prices typically stem from supply and demand — which means demand is higher during peak season.

Increased interest leads to more competition across the board, whether for a hotel room at the price point you want or the chance to nab tickets to that concert. And that’s only scratching the surface. Restaurants are more likely to get filled, airplanes to fly with fewer empty seats and wait times to get longer, and the likelihood of a complimentary upgrade diminishes.

Book during shoulder season and you’ll vie with fewer folks for your top experiences.

3. You won’t see as many offseason closures

While demand is high during peak season, sometimes demand drops so low during offseason that the places you want to visit aren’t even open. Boat tour operators might board up for the winter, and charming ski town cafes could close for the summer.

For example, January in Utah’s Zion National Park averages about 16% of the number of visitors that come during peak season in July, and most tourists will have a rough go. Ice forces certain trails to close, some roads become inaccessible to drivers, and the museum and services like shuttle buses aren’t available.

Instead, consider a trip during the September shoulder season, when crowds are at only about 85% of the park’s peak but most amenities are available. Plus, you’ll benefit from mild weather and the emergence of fall colors.

Around the world, hotels often take the offseason to do renovations, so the pool might become off-limits. Airlines typically cut back routes, so you’ll have less flexibility on what day or time you can fly.

But the shoulder season is less likely to entail such challenges. Travel before summer crowds arrive and you might be pleasantly surprised with a newly renovated hotel room. Head to the mountains just after the winter holidays to take advantage of still-snowy slopes without as many skiers on them.

4. Weather is generally pretty good

The shoulder season likely won’t bring the sweltering heat or storms that come with a region’s offseason. And in some cases, the weather during shoulder season is actually better than peak season.

Summer at Florida’s theme parks is often humid and muggy — and that’s before you add in the crowds of out-of-school kids. During shoulder season, you might forgo sunny summer days on the beach, but you’ll typically get temperate weather, not to mention a less sweaty smile in that photo with your favorite character.

Shoulder season in the Rocky Mountains might not entail the romanticism of white powder snow surrounding a cozy cabin. But, you can pack light and leave the parka at home.

5. You could more likely experience unique, local events

Tourist hot spots typically want year-round crowds, so they often host events, concerts and other festivities that don’t occur at times when crowds would be large anyway.

Theme park food festivals are among the most common shoulder season delights. Southern California theme park Knott’s Berry Farm typically hosts its annual boysenberry festival from March to April. Hawaii comes alive in the fall with festivals spanning multiple islands, including the annual Waikiki Ho‘olaule‘a, which is a giant block party on Oahu, and the Kauai Mokihana Festival, a weeklong celebration of Hawaiian culture.

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

Sally French writes for NerdWallet. Email: Twitter: @SAFmedia.

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5 Steps to Strengthen Your Finances in 2022

This article provides information for educational purposes. NerdWallet does not offer advisory or brokerage services, nor does it recommend specific investments, including stocks, securities or cryptocurrencies.

2021 was a year of financial strain for many Americans: Household debt and the overall cost of living increased, while median household income decreased, according to NerdWallet’s annual household debt study. In 2022, setting grand financial goals may not be realistic for every budget, but there are still smart steps you can take to shore up your finances.

1. Examine your spending

Household finances have changed drastically for many Americans over the past two years. Pandemic relief and stimulus programs — as well as the reduction of certain expenses due to pandemic restrictions, like commuting and travel — may have added money to some budgets. On the other hand, according to NerdWallet’s study, the overall cost of living has grown 7% over the past two years while median household income decreased 3% in the same span, putting the squeeze on many Americans.

A new year is an ideal time to examine your budget. Don’t have a budget? Start by pulling your bank and credit card statements for the past three months and adding up your spending in different categories — housing, food, utilities and so on — to see what an average month looks like for you. Knowing how much you’re spending now is key to creating a realistic budget for the future. Without this step, you might assume you should budget, say, $300 a month for groceries, but if you’re currently spending $600 a month at the supermarket, it’s probably not realistic to cut your spending so quickly by so much.

Once you’ve built a budget, compare your expenses to your income to see how much room there is to progress toward financial goals like saving and investing. You can then determine whether you need to increase your income, decrease your expenses, or both. Based on your eligibility, you might also consider seeking out programs to help you make ends meet, like an income-driven repayment plan for your student loans or the Supplemental Nutrition Assistance Program, or SNAP.

2. Add a little more to your consumer debt payments

Revolving household credit card debt — that is, credit card balances carried month to month — fell 14% over the 12 months that ended in September. But according to NerdWallet’s study, some Americans leaned on their credit cards to get through the pandemic. One in 5 Americans (20%) say they increased their overall credit card debt during the pandemic. Almost the same proportion (18%) say they relied on credit cards to pay for necessities during this time, according to the survey conducted for NerdWallet by The Harris Poll.

If you have a credit card balance and you don’t feel like you’re getting anywhere in paying it off, adding just a bit more to the monthly payment, if possible, can make a big difference.

Say you have a credit card balance of $5,000 at 17% interest, and your minimum monthly payment is $75. If you paid only that much each month, it would take more than 17 years to erase the debt, and you’d pay more than $10,400 in interest. But you could save thousands in interest charges and years of payments if you added $25, $50 or $75 to that monthly payment.

Small payment increases have a big impact

Monthly payment

Interest costs

Years to payoff













3. Evaluate your investments

Of Americans who have received pandemic relief since March 2020, 9% used at least some of that money to invest in cryptocurrency, according to the NerdWallet survey. This may be totally in line with your goals and risk tolerance, but take time to review your overall investment holdings. It’s recommended that you diversify your investments to reduce risk and increase your potential for return over the long term.

If you have a workplace retirement plan — like a 401(k) or 403(b) — participating in it can save you money on taxes in the short term and grow your nest egg in the long term. Consider investing your money there first — notably if your employer offers a match on your contributions. Otherwise, you’re passing up a guaranteed return on your investment.

4. Negotiate medical bills

Medical costs have risen by 31% in the past decade, according to the NerdWallet study. This is a staggering increase, especially when paired with a pandemic that resulted in overflowing hospitals. But medical bills are negotiable, and there are options to break up or even reduce your costs.

Many providers offer payment plans on medical bills. While you should inquire about associated fees or interest, this will probably be a cheaper option than using a credit card that charges interest. In addition, low-income patients may have access to hardship plans, which will break up your costs and potentially lower your overall bill. Ask your provider about these options.

You can also try to negotiate your balance down or seek a medical bill advocate to do it for you. Whichever route you choose, avoid ignoring your bills entirely. If your medical provider sells your debt to a collection agency, you have 180 days to deal with this debt before the collection account shows up on your credit reports. At that point, this debt can hurt your credit scores, making other financial moves harder in the future.

5. Save for something

More than 2 in 5 Americans (43%) who have received pandemic relief since March 2020 say they saved at least some of this money — for emergencies, a home or something else — according to the NerdWallet survey. So regardless of how much you can save and what your specific goals are, everyone could benefit from saving something, whether it’s $5 or $500 a month.

Your goal may be an emergency fund to help you stay afloat the next time the unexpected happens or a dream post-pandemic vacation paid in cash. But no matter what your ultimate goal is, regularly putting money aside gives you options, even if you choose to use the cash for something other than its intended purpose in the future.

Erin El Issa writes for NerdWallet. Email:

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5 Steps to Reach Your Money Goals in 2022

In addition to the new year bringing confetti and a fresh calendar, it’s a time to set big money goals for the next 12 months. That might mean finally paying off debt, buying a house or taking a long-delayed vacation.

With inflation and economic uncertainty clouding 2022, shoring up your finances this month can feel even more urgent.

“When you plan to start in the new year or some other important date for you, it can be easier to make that behavioral change, because we feel like we’re making a fresh start,” says Jeremy Burke, a senior economist at the University of Southern California’s Center for Economic and Social Research.

Here are five steps money experts recommend to help you reach your money goals in 2022:

1. Get a clear view of your finances

“The first step for everybody is to get organized,” says Phuong Luong, a certified financial planner at Saltbox Financial in Massachusetts. That means making a list of your savings, debt and assets. A complete picture of your finances can help you decide what to focus on for the new year, she says, and provide a document that’s easy to update annually.

Luong also suggests tracking your monthly cash flow with a spreadsheet or app to help you answer questions about what mortgage payment you could afford or which expenses you might be able to cut. “If you have those numbers organized, it’s easier to have those conversations, with a professional or with yourself, about what you can actually afford,” she says.

A complete self-assessment includes reflecting on your values, which may have shifted during the pandemic. “Figure out what is really important to you. Maybe you don’t want to spend as much on clothes, or you’d like to help more charities. Maybe instead of a car, you’d like a nice desk and chair. It’s easier to follow your budget when it’s aligned with your values,” says Shari Greco Reiches, a wealth manager in Illinois and author of the book “Maximize Your Return on Life.”

2. Take baby steps with your emergency fund

Emergency funds offer flexibility and comfort should you face unexpected expenses, but building one can be tricky. Behavioral economics suggests starting small, Burke says.

“Instead of setting a goal of saving $400 a month, it could be better to save $100 a week or an even smaller amount daily. There seems to be less friction to getting started when the time period is smaller so it’s pennies per day instead of dollars per month,” Burke suggests.

That means if you have a goal to save $1,000 by the end of the year, increase your chances of success by thinking of it as saving $2.75 a day.

3. Automate longer-term savings

Another lesson from behavioral economics, Burke says, is to set up automatic transfers into your savings each month. “In terms of improving long-term outcomes, it’s really helpful to have things automated as much as possible,” he says.

For example, if you contribute to a retirement account directly from your paycheck, you have to set it up only once, and your savings will continue to be deducted. You can also sign up to automatically increase the percentage you are saving each year or each time you get a salary increase, Burke adds. You could set up similar automatic transfers into a college savings account or a high-yield savings account for other goals like saving for a down payment.

4. Pay off the debt with the lowest balances

For Americans hoping to pay off high-interest debt this year, David Gal, professor of marketing at the University of Illinois Chicago, says his research shows that consumers are more successful if they start by focusing on the smallest balances first, called the debt snowball method. “That gives the perception of success and progress, and increases the motivation to pay off the bigger accounts,” he says.

Daphne Jordan, a CFP and wealth adviser in Texas, emphasizes the importance of staying positive. “Think about where you want to go in this new chapter of life,” she suggests. “Don’t see your financial past as a mistake. Everything is a learning experience.”

Having an accountability partner to check in with can also help keep you on track, says Rianka Dorsainvil, a CFP in Maryland and co-CEO of 2050 Wealth Partners, a financial planning firm. “Like with fitness, if we can count on one person checking in on us, we’re more likely to be successful.”

5. Plan for some fun, too

Budgeting for 2022 doesn’t have to be a downer: You can also fit in some fun spending plans, which might include reconnecting with friends and family. “If you want to take a trip in August, think about the cost of the plane ticket, hotel and food,” Dorsainvil says. If it totals $3,000, then aim to start saving $375 a month through August.

That way, she says, “You’re being realistic and setting measurable goals” — two approaches that increase your chances of success.

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

Kimberly Palmer writes for NerdWallet. Email: Twitter: @kimberlypalmer.

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For Young Adults, Building Credit Starts Now

Sooner than you may realize, your credit score will start to matter.

A solid credit score can be the difference between qualifying for an apartment or a low-interest car loan or missing out. So to have credit ready when you need it, the time to start building a good and lengthy credit history is now.

There’s more than one way to build credit, and it could be as simple as reporting your ongoing bill payments to the major credit bureaus. But keep in mind: Building credit takes diligence, particularly since missing payments can hurt your score for years to come.

What is credit and why does it matter?

Your credit score is a number that typically ranges between 300 and 850 and is calculated based on how reliably you’ve paid past debts, such as credit card bills. Lenders use your credit score to predict how likely you will repay debt.

Your credit score helps determine the loans you can receive, the interest you’ll be charged, the credit cards you can qualify for and the properties you can rent. An employer can even check your credit history. Having a good credit score can save you money later on, mainly through lower interest rates when you secure a loan.

If you’re starting with no credit history, you aren’t alone. In the U.S., nearly 40% of people between the ages of 20 and 24 have little to no credit history to generate a score, according to the Consumer Financial Protection Bureau. Unfortunately, the same is true for roughly 20% of the population.

Building your credit might seem overwhelming if you haven’t thought about it before, but there are many strategies to employ, even if you’re just beginning. Start by establishing good habits with managing debt, such as not taking on more debt than you can afford, says Brittany Mollica, a certified financial planner based in Chapel Hill, North Carolina. Missing payments will damage your score and can become a burden when you need to borrow money in the future.

“Getting in good habits of always paying your bills is really important,” Mollica says. “You don’t want to have to be climbing out of a hole of all sorts of credit card debt that you’ve piled up, especially starting out early on.”

Credit cards — and alternative cards

Credit cards can be a great tool to establish credit, but they can also damage your score if you take on more debt than you can handle.

If a parent or another trusted person in your life has a high credit limit and a long history of making timely payments, you could become an authorized user on their account and benefit from their good credit. This is one of the easiest ways to lengthen your credit history, says Blaine Thiederman, a certified financial planner in Arvada, Colorado.

Becoming an authorized user will also impact your credit utilization rate, or  the amount of money you owe to lenders divided by the total credit available to you, which can help your credit score.

If you have your own income, you can apply for a credit card when you’re 18 years old; otherwise, you have to wait until you are 21. A secured credit card is typically the best credit card to start with. A cash deposit backs these cards, and since the credit card company can take that deposit if you miss payments, people with short or poor credit histories can qualify.

The deposit you have to make for a secured credit card could be a burden, and if that’s the case, an alternative card might be better for you. These cards use income and bank account information to determine your creditworthiness rather than your credit score.

Monthly bills

If you live independently, payments for rent, utilities and phone bills can all be reported to credit bureaus. So paying those bills can build your credit if they’re on time and you have them reported.

Unlike credit card payments, these payments aren’t reported automatically and can require a third-party service, such as Experian Boost, to make the credit bureaus aware of your payments.

Remember, these services sometimes require a fee and reporting your bill payments may not always impact your credit score; instead, they may just appear on your credit report.


Making regular payments on loans can also help you build your credit. And even if you don’t have any credit history, some loans are available.

Credit-builder loans rely on income rather than credit for approval. If you’re approved, the loan sits in a bank account and becomes available once you pay it off. Your monthly payments are reported to the major credit bureaus.

Student loans are another loan you can use to build your credit when you’re just starting. Federal student loans don’t require credit to qualify, while most private student loans do. Paying off your loans will help you grow your credit history, and you can get started while you’re still in school by making interest-only payments.

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

Colin Beresford writes for NerdWallet. Email:

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