In this issue:
General News | Featured Tool | College Planning | Who's Who | Financial Aid
Scholarships & Other Aid Opportunities | Financial Literacy | Student Loan Management | Calendar
General News
Create Connections at OCAP's Annual Conference
Are you ready to connect with partners who share your vision of facilitating a college-going culture for Oklahoma families? If so, be sure to register for the Oklahoma College Assistance Program's (OCAP) annual conference,(external link) to be held Nov. 1 at the Moore-Norman Technology Center, South Penn Campus in Oklahoma City. Join us to network with other service providers and gather information and resources to support your mission of student success; there's no charge to attend!
This year, we're excited to offer session tracks that correlate to the collegiate lifecycle, making it easy for you to identify workshops that offer learning opportunities and tools for the audiences you serve.
Track 1: Resources for College Readiness. These sessions will explore pre-college programs and services for K-12 students and parents, educators, administrators and counselors.
Track 2: Counting on College Success. These sessions will focus on helping current students find the formula for postsecondary success, from enrollment through graduation.
Track 3: From College to Career. These sessions will address ways to strengthen the transition from college to the workforce, as well as opportunities for adult learners to begin or resume higher education.
The conference will showcase not only presenters from OCAP and the Oklahoma State Regents for Higher Education, but speakers from local and national organizations, as well. Sessions provided by OCAP’s UCanGo2(external link) and Oklahoma Money Matters(external link) initiatives will include information on planning, preparing and paying for education after high school, smart student borrowing, and the transition to financial independence after college graduation. We’ll also offer default prevention workshops and information about OK-CAN,(external link) the state’s college access network. Several of the State Regents’ key initiatives - including student preparation, academic policy, Reach Higher(external link) and Oklahoma’s Promise(external link) - will be featured in breakout sessions. Additionally, the conference will offer professional development opportunities, a seminar on the unique challenges of working with lower-income students, and workshops about new and enhanced services hosted by representatives of Federal Student Aid, the U.S. Department of Education and Mapping Your Future. You won’t want to miss a moment!
Our conference flyer (PDF) provides an overview of the available sessions, and you can find a full conference agenda and more information on the OCAP website.(external link) Registration is free(external link) and a box lunch will be provided. See you there!
Calling All Counselors: UCanGo2 Toolkits are Here!
The 2011-12 UCanGo2 toolkits – including our new toolkit for middle school counselors - are here!
If you received a high school toolkit last year, we’ll mail your new kit promptly. If you’re not already on our mailing list, visit UCanGo2.org/Counselors(external link) and click on the high school kit ‘order’ box in the left-hand margin.
If you signed up at one of our workshops to receive the new middle school toolkit, you’ll soon receive your kit. If not, you can click the ‘order’ box for the middle school kit at UCanGo2.org/Counselors.
You can also download tools from both kits on the same Web page. (external class) To review and download all of our helpful materials for planning, preparing and paying for college, check out the Resources tab at UCanGo2.org.(external link) There you’ll find a new ‘Request Publications’ button; click it to download our publication order form. UCanGo2 will provide up to a maximum of 250 copies of our publications per school, subject to availability of inventory.
To learn more about UCanGo2 materials and services, contact OCAP’s Outreach Team at 405.234.4239, 866.443.7420 (toll free) or UCanGo2@ocap.org.
Socialize (even more) with OCAP on Facebook
We’ve added two new Facebook profiles to our social media network! Hopefully you already ‘like’ UCanGo2 on Facebook (facebook.com/UCanGo2)(external link) and ‘follow’ Oklahoma Money Matters on Twitter (twitter.com/OKMoneyMatters).(external link) Now we invite you to visit Facebook and ‘like’ our new pages:
Student Loan Repayment Scoop (facebook.com/RepaymentScoop),(external link) which offers debt management advice, loan forgiveness options, and default prevention strategies to support borrowers in repayment.
Oklahoma Money Matters (facebook.com/OklahomaMoneyMatters),(external link) which offers information about financial education trends and events, consumer tips and money management tools for students, parents, educators and campus and community partners.
We hope you’ll also encourage the students and parents you serve to engage with OCAP’s helpful departments through these pages. Check them out today!
Making Work Work
Clear Obstacles on the Road to Creativity
Creativity doesn’t run in a straight line, and the roadblocks aren’t always obvious. You may have to go around them, go over them, or tunnel beneath them, but first you have to recognize them. Steer clear of these obstacles to avoid a creativity crash.
- Excessive rationality. The creative process doesn’t always follow logical rules. You’re looking for connections among unrelated (and sometimes contradictory) objects, goals, processes or ideas. Free yourself of the need to make sense all the time and let your intuition guide you.
- Obsession with scale. A "big idea" is sometimes the sum of smaller ideas. Facebook began with a few hundred students at Harvard; now it dominates the Internet in most of the world. Don’t reject a concept or approach simply because it doesn’t feel like an instant global home run.
- Immediate productivity. You can’t always predict where an idea will lead, so don’t rule something out if it doesn’t seem immediately viable. You may be able to adapt it, or it may become useful in the future when your situation has changed.
- Fear of _____. If your creativity is blocked, ask yourself this key question: what am I afraid of? Do you fear failure? Success? Criticism? Creativity always involves an element of risk. You may not be able to make fear disappear, but it will lose much of its power if you confront it directly.
Featured Tool
OKMM's New Personal Finance Guide for Adults
Building upon Oklahoma Money Matters’ (OKMM) successful series of Your Money Matters guides for high school and college students, we’ve recently added another guide to our growing list of resources: our Your Money Matters guide for adults.
This booklet and supplemental CD, developed particularly for distribution and use in workplace education programs, cover financial aspects all adults face. Beyond the basics of budgeting, saving and using credit wisely, this guide covers purchasing a vehicle, homebuying, paying for college, saving for retirement and caring for elderly parents, among other topics.
We also offer a Your Money Matters guide for adults with fewer financial resources, which is designed specifically to help families who struggle to make ends meet understand financial concepts and make financial stability a realistic goal. You may recall this tool was featured in the June 2011 edition of the Online News.
To request copies of the new adult guide and supplemental CD and learn more about our workplace education efforts, call 800.970.OKMM or email OklahomaMoneyMatters@ocap.org.
College Planning
Reach Higher to Finish What You Started
Every day, you devote your time and attention to helping Oklahomans obtain a higher education. What about you? Did you begin a degree program that had to be put on hold? Do you work with adults who are waiting for the right time to go back to school? This may be the perfect time to reach higher!
Reach Higher (external link) – Oklahoma’s degree completion program – is now offering two 
degree programs for working adults. Adults who’ve earned at least 18 hours of college credit can now complete an Associate in Arts or Associate in Science degree in enterprise development (general studies or business administration). Those who’ve earned at least 72 credit hours can complete a Bachelor of Science degree in organizational leadership.
At the end of the spring 2011 semester, 170 people had graduated from the Reach Higher program, and this summer there were 430 students enrolled in classes. That means 600 adults (and counting) have decided to take advantage of the program and finish what they started.
We know that managing work, family obligations, community involvement and school is challenging, but consider this: Reach Higher students can choose a “home institution” from 14 participating public community colleges and technical branches or 9 participating public universities across Oklahoma. With so many options, there’s likely to be a campus near work or home. It’s also important to remember that the degree programs are designed to meet the scheduling needs of working adults, and many classes are offered online.
To learn more about the Reach Higher program, go to www.reachhigheroklahoma.org (external link) , visit the Reach Higher page on Facebook (facebook.com/ReachHigher) (external link) or call 800.951.0768 (toll free). Visit the State Regent’s website, (external link) too, for helpful information to support adult learners, including admission requirements, a degree program inventory, financial aid options, tips for getting started and a Frequently Asked Questions section. There’s also a dedicated section for adult learners at UCanGo2.org. (external link)
More College Access News
- With millions of students returning to college campuses this year and a nation still reeling from the recent debt ceiling debates and ongoing economic uncertainty, the question looms: Is a college education still worth the price? (external link) Unequivocally, yes.
- There’s a lot of great information out there for students seeking scholarships, but there are also some ‘urban legends’ about who gets scholarship dollars, and why. Read about the top 10 scholarship myths; (external link) the facts may surprise you.
Who's Who
Do You Know Inger Giuffrida?
Inger Giuffrida is a freelance financial educator and asset building consultant who travels across the country helping businesses, schools and agencies with their financial literacy efforts. She also serves as Education Chair for the Oklahoma Jump$tart Coalition, a member organization dedicated to improving financial education in our state. In this role, Inger plans and organizes the annual Financial Education in Oklahoma (FEiO) Conference (external link) hosted by the Oklahoma Jump$tart Coalition and the Federal Reserve Bank of Kansas City, Oklahoma Branch.
We asked Inger to fill us in on this year’s conference, Frauds, Scams and Cons: Protecting Yourself and Your Assets through Financial Education, which will be held at Moore-Norman Technology Center, South Penn campus on Nov. 2. That’s the day after the OCAP conference!)
What’s the purpose of the Financial Education in Oklahoma Conference, and what audience(s) does it serve?
The FEiO Conference is the one event each year that brings together everyone across Oklahoma that is or wants to be involved with financial education. The participants represent a wide range of organizations and constituencies – from Head Start programs serving children and families to teachers and administrators serving youth to extension agents and social service providers addressing the many needs of adults and seniors.
The focus this year is fraud, scams and cons. Why is this theme important?
People work hard to build a nest egg and ensure financial security for their families. Unfortunately, there are scammers and fraudsters that work just as hard to take that nest egg away. Identity theft, a foreclosure scam or an investment fraud can devastate a family financially. The recent increase in foreclosures and job losses has forced many people to look for financial help in ways they haven’t had to before and unknowingly be duped by those that say they will help. Changes in technology with more online accounts and new forms of products and services have also increased uncertainty for many consumers – and opened more opportunities for scammers.
What do you feel are some of the biggest issues related to Identity theft and fraud that people need to know about?
The first issue is that nearly everyone believes they can’t be a victim of frauds, scams or cons. Understanding what makes all of us susceptible will be a starting point for this conference. People who are desperate are even more likely to be victimized, because they often feel they’ve run out of options—the promise of a quick fix, which is the lure of many scams, is just too hard for many to pass up when the situation seems hopeless.
Secondly, scams, cons and frauds are always changing. That’s one of the most insidious things about them—the perpetrators are constantly innovating by finding new ways to part people from their money, by investing in “new products and services” and by using technology.
Finally, identity theft has become incredibly pervasive. According to the Federal Trade Commission (FTC), identity theft has been the number one consumer complaint for eleven years in a row (inclusive of 2010), representing nearly one out of every five calls they receive. The FTC estimates that nearly 9 million Americans have their identities stolen each year.
As financial educators, we need to understand why identity theft, scams and fraud happen, how to detect and prevent them and ways to educate the people we serve so they can avoid the financially and emotionally costly results of being victimized.
How do you think people can best protect themselves from scams?
The first thing people can do is recognize that they could be a victim of identity theft, frauds or scams—people who don’t believe it could happen to them are unlikely to take preventative counter measures. The second is education—learning how and why these crimes are committed and ways to mitigate their likelihood is the foundation for avoiding them. This year’s FEiO conference is designed to help all of us understand why, when and where we are likely to be victimized; how to deter, detect and defend against these crimes; and ways to recover if we’ve been targeted.
We appreciate your important work, Inger. See you at the FEiO conference!
Financial Aid
OCAP Enhances Default Prevention Efforts
Our Default Prevention team continually strives to further strengthen and refine services that help delinquent borrowers get back on track and support our schools’ efforts to prevent loan default. We’re excited about recent enhancements to our call campaigns and late stage delinquency program, and we’d like to share them with you.
For years, OCAP’s default prevention department has utilized an auto-dialer to make ‘attended’ calls (meaning an OCAP team member is on the call to visit with the borrower) to delinquent borrowers. We make calls to delinquent borrowers on Monday through Thursday from 8:00 a.m. to 9:00 p.m. and on Friday from 8:00 a.m. to 5:00 p.m. Given the busy schedules of many borrowers in repayment, it’s a challenge to reach them at the best right-party-contact times, which are Friday afternoons, Saturdays and holidays. OCAP has implemented unattended calls to reach out to borrowers during these timeframes with important messaging about options to bring delinquent accounts current.
We asked OCAP’s default prevention supervisor, Lisa Hale, about the benefits of using unattended calls. Lisa states, “When delinquent borrowers receive an unattended call, they hear customized, detailed messaging explaining available options to restore repayment success, as well as contact information they can use to receive help from OCAP in resolving their student loan delinquency.”
OCAP also recently expanded our late stage delinquency (LSD) program. Our LSD efforts begin at 240 days delinquent and now continue after the Notice of Default (NOD) is received, until the claim is purchased. Other OCAP LSD strategies are listed below.
- Team members use the quickest resolution and delivery methods to address delinquency and work with lenders/servicers to “recall” default claims before finalization to avert default.
- Three-way calling is available to connect the delinquent borrower and the lender/servicer.
- Unattended and attended call campaigns are used to target specific solution driven results, such as Direct Loan consolidation, Income-Based Repayment, and deferments.
- All campaigns are initiated during the best contact times, and dialer campaigns and staff are available 8 a.m. through 9 p.m. on Monday through Thursday and 8 a.m. 5 p.m. on Friday.
Unattended and attended solution-driven call campaigns inform borrowers that now is the time to prevent the impending default and explain the consequences related to default, such as the addition of collection costs, negative impact on credit ratings, and loss of eligibility for deferment and forbearance options and additional Title IV funds. Wayne Sparks, Default Prevention manager says, “These expanded LSD strategies enable our team to give delinquent borrowers that last chance to restore their loan to current status. We want to help as many Oklahoma borrowers as possible avoid defaulting on their student loan.”
OCAP’s Default Prevention team is ready and able to help you reach your default prevention goals. Contact us today at 405.234.4358, 800.247.0420 (toll free) or wecanhelp@ocap.org to learn about our many services for financial aid professionals, including assistance with loan counseling, free access to the Default Prevention School Tool, and cohort analysis. We’re here to help!
Title IV Aid in the Wake of a Disaster
If you’re a financial aid administrator working with students or parents affected by the recent hurricanes on the east coast, remember you can refer to the Department of Education’s (ED) Dear Colleague Letter (DCL) GEN-10-16, (external link) which outlines how an institution may utilize professional judgment to assist a student or his/her family with a financial aid package, the specific instances in which an institution can use professional judgment, and the documentation required to reflect use of professional judgment.
If you have questions about the information included in DCL GEN-10-16, (external link) contact your School Participation Team Representative. For a list of contacts, go to ifap.ed.gov/ifap/disaster.jsp (external link) and choose the “School Participation Team Contacts” link under the Postsecondary Schools listing.
Rethinking the Aid Award Letter
On Sept. 13, the U.S. Department of Education (ED) convened a public meeting to make recommendations for development of a model financial aid offer form, as required by Section 484 of the Higher Education Opportunity Act (HEOA) of 2008.
This effort is intended to create a user-friendly format that will enable prospective students to compare bottom-line costs across multiple institutions. The HEOA requires that the model form include:
- Estimated Cost of Attendance (including tuition and fees, room and board, books and supplies, and transportation expenses).
- Amounts of aid that the student does not have to repay, and the conditions for such aid.
- Types and amounts of federal loan eligibility, and the applicable terms and conditions of such loans.
- The net amount the student/family will have to pay (calculated by subtracting gift aid and federal loans from the Cost of Attendance).
- How the student/ family may seek additional information regarding the financial aid offer.
- Any other information ED deems necessary.
Ultimately, ED will submit recommendations to the authorizing committees and make the recommendations and model format widely available. A website has been established (external class) to post information regarding this process and additional opportunities to comment.
SWASFAA’s 2011 Conference
What’s more fun than a big, juicy turkey on Thanksgiving? It HAS to be the Southwest Association of Student Financial Aid Administrators’ (SWASFAA) 2011 conference! This year the conference will be held right here in Oklahoma. It’s scheduled for Nov. 16-18 at the Hard Rock Hotel and Casino in Tulsa, and the theme is Keep on 
Rockin’. New and even seasoned financial aid professionals are also encouraged to attend the Boot Camp training, which will be held Nov. 14-16. Registration for both events and the tentative agenda are now available on the SWASFAA website. (external link)
The hotel reservation deadline is Oct. 14; to reserve a room, call 800.760.6700 (toll free) and request the group rate for the Annual Southwest Regional Convention. Reservations can also be made online at HardRockCasinoTulsa.com. (external link) Click ‘Online Reservations’ on the left-hand side of the Web page, then click ‘Group Reservation’. The group code to use on the Internet is SASF111311.
Three of Oklahoma’s own have important roles in this year’s conference: Laura Coponiti is the 2011 SWASFAA president; Andrew Hammontree is the conference chair; and Kelli Kelnar is the local arrangements chair. Laura, Andrew, Kelli and the rest of the team have been working very hard to make this conference a success. Show your support for SWASFAA and Oklahoma by registering today! (external link)
What's New on IFAP?
Electronic Announcements
Gainful Employment Electronic Announcements (GEEA)
- Sept. 28 – GEEA #25 – Disclosures by Educational Program (external link)
- Sept. 28 – GEEA #24 - NPRM: Application and Approval Process for New Programs (external link)
- Sept. 26 – GEEA #23 - Gainful Employment Reporting Functionality Now Available on NSLDS (external link)
- Sept. 22 – GEEA #22 - Updated NSLDS Gainful Employment User Guide (Sept. 22, 2011) and NSLDS Newsletter #34 Now Available (external link)
General
- Sept. 23 – Letter from Federal Student Aid (FSA) Chief Operating Officer James W. Runcie to College Presidents Regarding Gainful Employment Reporting Requirements (external link)
- Sept. 16 – Appointment of Federal Student Aid's Chief Operating Officer (external link)
- Sept. 2 – Program Integrity Information - Questions and Answers (external link)
Loans
- Oct. 3 – Loan Servicing Information - MOHELA Joins Federal Loan Servicer Team (external link)
- Sept. 23 – Loan Servicing Information - Transition to New Direct Loan Servicing Center (ACS) System and Web Sites Planned for Oct. 10, 2011 (Update #5) (external link)
- Sept. 23 – Loan Servicing Information - New Servicers Join Federal Loan Servicer Team October 2011 - January 2013 (external link)
- Sept. 21 – Federal Perkins Loan Default Reduction Assistance Program (DRAP) (external link)
- Sept. 16 – Loan Servicing Information - Transition to New Direct Loan Servicing Center (ACS) System and Web Sites Planned for October 10, 2011 (Update #5) (external link)
- Sept. 16 – Direct Loan Processing Information - Master Promissory Notes (external link)
- Sept. 12 – Briefing on National Default Rates (Updated Sept. 15, 2011)
- Sept. 12 – FY 2009 Official Cohort Default Rates Distributed Sept. 12, 2011 (external link)
- Sept. 1 – Loan Servicing Information - Transition to New Direct Loan Servicing Center (ACS) System and Websites Planned for Fall 2011 (Update #4) (external link)
Common Manual Update
The latest version of the Integrated Common Manual is available on the Common Manual website. (external class) As always, if you have questions about the manual, contact our Policy, Compliance and Training department at 405.234.4432, 800.247.0420 (toll free) or pct@ocap.org.
New Servicers Join Federal Team
On Sept. 23, ED announced that Federal Student Aid (FSA) will award 15 new federal loan servicing contracts beginning October 2011. Initially, these servicers will be assigned existing Direct Loan (DL) accounts. If transferred, borrowers will be notified of the transfer by their new servicer. For further information, please see the e-nnouncement (external link) or the Information for Financial Aid Professionals (IFAP) website. (external class)
More Financial Aid News
- Senate Budget Would Preserve Pell (external link)
- Army Clarifies Post-9/11 GI Bill Eligibility (external link)
Scholarships and Other Aid Opportunities
The College JumpStart Scholarship (external link) is an annual, merit-based competition open to 10th-12th graders, college students and non-traditional students. Applicants must attend or plan to attend an accredited U.S. institution and demonstrate commitment to using education to better themselves, their families and their communities. The first place award is a $1,500 scholarship! Learn more at jumpstart-scholarship.net (external link) and find more scholarship programs on our Scholarship Opportunities page.
Financial Literacy
Financial Trick-or-Treating
Don’t believe the rumors; financial planning doesn’t have to be scary. Think back to when you were a kid. When October arrived and trick-or-treating was on your mind, did you have a game plan? Did you spend hours mapping 
out which houses gave out full-sized candy bars and crossing off those that gave toothbrushes? Back then, having a solid plan of attack made the difference between a full candy bag (and weeks of sugar highs) and a total bust.
As adults, planning for our financial life should be just as carefully crafted and profitable as those past Halloween blueprints. Here are some tips to take the fright out of finding a financial planner.
- Know your priorities. Thinking about where you are in life and what’s important to you and your family is necessary to find a planner who specializes in your area of need and can best help you meet your goals.
- Shop around. Interview several financial advisors before settling on one. Ask about expertise, rates and anything else you want to know before making a commitment. A reputable planner will be able to supply references to verify quality of work and overall customer satisfaction.
- Be honest. A financial planner’s advice is only useful if you’re open and honest about your situation. Be up-front about your mistakes, resources, goals, risk tolerance and money philosophy.
- Ask questions. Don’t be intimidated; there are no stupid questions about finances. Ultimately it’s your money that’s on the line, so ask for clarification if you don’t understand something. If you need more time to make a thoughtful choice, say so.
To learn more about financial planning or to find a certified financial planner or certified personal financial specialist in your area, visit the Financial Planning Association’s website, fpanet.org. (external link)
Protect Your Assets with Insurance
Life happens and when it does, it usually costs money. Sometimes, lots of money. The purpose of insurance is to help alleviate our fears of the unexpected, but if the unexpected doesn’t happen, you’ve lost money on the deal. 
That’s why choosing the right level of insurance coverage is an essential part of your financial plan. Experts recommend re-evaluating your insurance coverage at least once each year. Here are a few things to consider.
Protect Your Health
Shopping around for health insurance may not be an option if you’re on an employer-sponsored plan, but you can figure out if you’re getting the most out of your health insurance.
Some high-deductible plans qualify you for a health savings account, which is a tax-advantaged savings plan to help you cover extra costs. Unlike a flexible spending account, funds will roll over and accumulate each year. Other plans offer perks like a free or discounted gym membership. Talk to your human resources representative to make sure you’re getting the most out of your plan.
Protect Your Home
Whether you rent or own your home, disasters like a burglary or fire could be financially devastating. As a homeowner, you’re required to have insurance to cover such an event, but many people aren’t sure exactly what their policy covers. Ask your insurance agent if you’re covered in the event of a flood or tornado and whether you have a replacement policy or a cash value policy. A replacement policy will replace items with equivalent models. A cash value policy will give you the cash value of items that are lost or damaged. Typically, a replacement policy is best for older homes and a cash value policy is more cost-effective for newer homes.
If you’re a renter, there’s an insurance option for you, too. Renter’s insurance is one of the most affordable types of insurance coverage available, and it covers your belongings in the event of a disaster. When you consider the collective cost of replacing televisions, computers, gaming systems and gadgets, a break-in could cost you thousands. Most renter’s insurance policies start at less than $30, so even college students can afford this essential protection.
Protect Your Car
A car accident carries two types of costs: personal injury and damage. The law requires you to carry personal injury liability coverage at minimum, but comprehensive collision coverage may also be worthwhile for newer vehicles. As your car ages, the cost to repair damage will begin to outweigh the actual worth of the vehicle. When this happens, paying to insure the car against damage may not be economically feasible. Visit the Kelley Blue Book website (external link) to estimate your vehicle’s resale or trade-in value each year and make sure you’ve got the best insurance coverage at the best price.
What’s Your Score?
If you’ve ever been tempted to purchase your credit score - the number used to determine if you’ll repay your debts, as compared to other consumers - there are some important things you should know. According to the Consumer Financial Protection Bureau, the score you see and the one seen by lenders may differ.
Due to the variety of scoring models available today, there’s no way to determine your “true” credit score. Scores seen by creditors will depend on the scoring model they use, the credit reporting agency they work with and the lending factors they deem most important.
While a good credit score is important, it’s also subjective, so focus on practicing positive financial habits and regardless of the scoring model, your credit score will reflect your good efforts.
- Always pay your bills on time.
- Review your credit report annually and dispute any errors.
- Don’t apply for a lot of new credit.
- Limit credit usage to less than 30 percent of your available credit limit.
- Talk to your creditors if you’re having problems making your payments; ignoring the problem only makes it worse.
- Avoid “credit repair” companies that promise to clean up your credit report for a fee.
Tax Breaks for School Expenses
Given our struggling economy, it’s more important than ever to remind students about the many tax incentives the government offers to help offset education costs. The Joint Committee on Taxation estimates that tax benefits for higher education expenses will total $17.3 billion in Fiscal Year 2011. Students and parents could be missing out on the following tax breaks.
Hope/American Opportunity Tax Credit (external link)
Passed in 1997 and expanded in 2009, the Hope/American Opportunity Tax credit is available to students, the spouse of a student who is paying the student’s expenses, or parents of a dependent student. The credit applies to expenditures for tuition and fees and course expenses such as books for the first four years of a higher education program.
Lifetime Learning Tax Credit (external link)
This credit isn’t limited to the first four years of school, so it’s available to some taxpayers who may not qualify for the Hope/American Opportunity credit, such as graduate students, adult students returning to school or students who take longer than four years to complete a degree. The credit provides for 20 percent of the first $10,000 spent and does have income limits.
Student Loan Interest Deductions (external link)
Borrowers who make $60,000 per year or less (or $120,000 if filing jointly) can deduct up to $2,500 in student loan interest paid during the year. Remind students to look for a Form 1098-E from their lender at the end of the year, which will show how much interest was paid.
Tax-free Employer Education Reimbursements (external link)
Some employers offer reimbursement benefits for employees who wish to pursue higher education. The first $5,250 of this perk doesn’t need to be reported to the IRS as income.
These tax incentives are designed to ease the financial burden of obtaining a degree, but they only work if you use them! Encourage your students and their parents to speak with a tax professional about eligibility requirements for these benefits.
Do it Herself: A Journey to Financial Freedom
On Nov. 4 in Tulsa, the Oklahoma Society of CPAs (OSCPA) will present Do It Herself: A Journey to Financial Freedom, an annual conference created by women, for women. These events feature workshops on eliminating debt, raising money-smart kids, entrepreneurship, managing relationships and finances, and much more. Conference registration is only $15. In its continuing partnership with the OSCPA, members of Tinker Federal Credit Union who register in advance can attend free of charge. For more information, including a detailed agenda, visit KnowWhatCounts.org. (external link)
Student Loan Management
Avoid Scary Student Loan Debt
New college graduates face a lot of fears … the transition to financial independence, endless interviews, finally landing that dream job. Unfortunately, many graduates also face a mountain of student loan debt. Thankfully, there are simple ways the students you serve can avoid a student debt nightmare.
- Borrow responsibly from the start. The financial aid office can help students determine how much they’ll need to pay school expenses; limit borrowing to that amount. Each dollar borrowed is one that has to be paid back later, plus interest! Encourage students to exhaust all federal loan eligibility before considering “private” or “alternative” loans, which often have higher interest rates and fewer flexible repayment options.
- Keep tabs. It’s important to re-evaluate borrowing needs each semester and borrow only what’s necessary to cover school expenses. It’s also important to keep track of how much is borrowed as each semester passes; a good rule of thumb is to make sure that monthly debt payments after graduation will stay below 8 percent of the expected monthly salary. Check out Mapping Your Future’s debt/salary wizard (external link) to crunch the numbers.
- Tackle interest. Every borrower should consider paying the interest accruing on unsubsidized federal loans while in school. Interest payments are usually affordable, even on a tight budget, and can save hundreds over the life of a loan.
- Plan for repayment. Students can’t wait until the grace period is up to start thinking about loan repayment. By that time, extra funds may have been committed to car payments, a mortgage or rent, or other obligations. The six-month grace period is designed to give students time to work repayment into the budget; we encourage borrowers to begin putting the amount of their student loan payment into savings right away. Then, when repayment begins, they’re used to living without that cash for daily expenses.
- Ask for help when help is needed. Borrowers who find it difficult to make student loan payments should talk to their lender(s) immediately. Deferment or forbearance options may be available in times of hardship, and federal loans offer a variety of different repayment schedules to meet borrower needs.
More Student Loan Management News
- 10 things students should know about private education loans (external link)
- A tailored loan payment plan could help (external link)
Calendar
- 2011-12 State System Academic Calendar (PDF)
- Nelnet’s Webinar Wednesday series (external link)
- October and November: College Fair Schedule (external link)
- October 10: FSA Offices Closed for Columbus Day(external link)
- October 13 at 12:30 p.m. (CST): FSA Webinar: NSLDS Gainful Employment Reporting Process (external link)
- October 18 at 8 a.m. (CST) and October 20 at 2 p.m. (CST): FSA Webinars: DL, COD & StudentLoans.gov (external link)
- October 31 - November 4 and May 7-11, 2012: Federal Student Aid Title IV Fundamentals training, Dallas
- November 1: OCAP Annual Conference
- November 2: Financial Education in Oklahoma Conference
- November 3: Native American College Fair Day, Apache (email CraigMarroquin@gmail.com for details)
- November 29 - December 1: Federal Student Aid Conference, (external link) Las Vegas