College Financial Education Your ( Financial ) Life Leslie Lum Molly Blume Audrey Hue bellevuecollege/financialeducatio

1. College Financial Education Your (Financial) LifeLeslie LumMolly BlumeAudrey Huewww.bellevuecollege.edu/financialeducation 1

2. Why are you here?What motivates you . . . to save money? . . . To spend money? • What financial troubles have you seen with family or friends? • What financial problems would you like to avoid? • What do you need to know to achieve personal financial success? How to make money, save money, and protect your money ? Check out these 1 credit classes: • GBUS 102 Personal Money Management, • GBUS 103 Personal Savings, • GBUS 104 Personal Credit, • GBUS 108 Personal Investments • Learn how to set up your personal financial goals for: • emergencies, college funding, unexpected living expenses, • car, wedding, house, new baby, and retirement income.

3. Your Priorities Activity -- Make 2 lists: Financial Dreams Financial Nightmares • You are not alone. Many people have similar concerns. • Today-3 topics: • Setting Personal Financial Goals • Learn about Spending Plan • Credit Do’s and Don’ts • Money saving tips

4. Your (Financial) Life 4

5. Set Exciting Goals • What do you want to achieve this year? • Over the next year, what ONE occurrence would have to happen for you to feel you’ve made significant financial progress? • Write this occurrence as a goal.   • Describe why it is important to you. • Describe how you will feel when you have accomplished this goal. 5

6. How can you save and what is the effect of saving every year? • What if you cut out candy and pop, or fast food meals, or one sit-down restaurant meal a week, or 5 fancy coffees a week? • Your savings would be $25 a week. • What will you have in 40 years? 3/7/2014 6

7. Start Saving NOW. . . Saving $25 a week for 40 years at 5 or 8 % can build quite a nest egg ! • Using automatic savings deductionsthrough work, bank or credit unions builds a larger nest egg for future needs. • Take the GBUS 108 Investingclass to see how to earn higher investment returns. 3/7/2014 7

8. Saving Plan • Helps you achieve all your financial goals • It can help you get control of your life • It can relieve stress and stop conflict in a family • Start as a student even if you don’t have much money • It should be a lifetime habit 8

9. It’s a marathon not a sprint – plan your saving. 9

10. How Can you Start Saving? Develop a Spending Plan. . . . List all your income. Accumulate all your expenses (receipts, credit card bills, checking account register, etc.) Categorize it as fixed, variable and discretionary. Create a debt reduction plan. It’s never too early to start paying off your student loan. Consolidate all these into an annual spending plan. Compare your spending to the recommended student budget. Adjust your spending plan so you can meet your spending goals. Live by your spending plan for 3 months and then check how you’re doing. Check your spending plan at the end of the year. Did you meet your budget? Do it again for next year. Keep at it. It’s a marathon not a sprint. 10

11. Activity: Create a Spending Plan For an online college student budget, check out: http://www.edwise.org/edwise/edFundFrame.html 11

12. Compare to UW Student Budget http://admit.washington.edu/Paying/Freshman/Budget 12

13. Compare to Community College BCC estimates based on UW data 13

14. What students owe by college 14

15. Spending/Savings Tips for College Students • Leave the car at home. Walk or use public transit. Carpool. • Buy used books. • Comparison shop for your computer and keep it safe so it doesn’t get stolen. • Comparison shop your cell phone plan. Use long distance calling cards. • Go to free entertainment or get student discounts. • Rent DVDs instead of going to movies. 15

16. Bucking the debt generation – good credit habits 16

17. Student Credit Card Facts • Credit card debt is 16% of debt when students leave college • Students have an average of 4 credit cards • 33% of students have over $2000 in outstanding balance • Most students underestimate the amount of credit card debt they have • Most students don’t pay their credit card bills in full at the end of the month 17

18. Work-spend Rat Race Lower score means higher anxiety! Don’t work to spend, it can hurt your grades and your chances of finishing college on time or at all. Source: Nellie Mae 2005 Study of undergraduate students and credit cards 18

19. Students who work a lot of hours feel: • They can’t select courses they need because conflicts with work hours • They study less • Work hurts their grades • They are more stressed • They are more likely to drop out or fail out 19

20. Learn More. . . 20

21. Are you ready to play the Credit Game? 21

22. Credit Card Do’s • Credit cards encourage you to spend. So if you have problems with spending too much, use cash. • Credit cards are a very expensive way to borrow money. Pay all credit cards on time and in full. If at all possible, do not maintain outstanding balances. Do not use features such as cash advance. • Do not spend up to your credit limit. • Opt out of credit card offers by calling Opt out 888-567-8688 or going to the website www.optoutprescreen.com. • Before you sign on to a credit card, use the credit card evaluation form to evaluate all fees and charges. • Keep only two credit cards on you to minimize loss. • Keep a record of your account numbers, their expiration dates, and the phone number and address of each company in a secure place. Some fraud experts recommend that you photocopy the cards you carry with you. 22

23. Credit Card Do’s • Protect your card and your account number. Sign your credit card when it arrives. Don’t lend your card to anyone. Don’t give out your account number unless you know you are calling a company that is reputable. Destroy incorrect receipts and copies. • Save receipts to compare with billing statements. Open bills promptly and reconcile accounts monthly, just as you would your checking account. • Report any questionable charges promptly and in writing to the card issuer. Do not pay for purchases where product was not delivered or defective. • Correct any billing errors by contacting your credit card company as soon as possible. • If you use your credit card to shop online, experts advise installing and periodically updating virus and spyware protection and a "personal firewall" to stop thieves from secretly installing malicious software on your personal computer remotely that can be used to spy on your computer use and obtain account information. • If you lose your credit or charge cards or if you realize they've been lost or stolen, immediately call the issuers. Many companies have toll-free numbers and 24-hour service to deal with such emergencies. By law, once you report the loss or theft, you have no further responsibility for unauthorized charges. In any event, your maximum liability under federal law is $50 per card. 23

24. Managing student loans 24

25. Students Loans • 55% of borrowers felt burdened by the loan • 54% would have borrowed less if they had to do it again 25

26. Student Loan Do’s • Save as much as you can using tax-advantaged educational savings plans before you go to college. • Make sure that you have a good chance of earning the income you need to pay off the debt. • Only borrow as much as you need. • Fill out the Free Application for Federal Student Aid (FAFSA) for federal loans first. They are the cheapest and have the most options. • Comparison shop for private loans and evaluate APRs. Check out the maximum monthly payment if you are considering a variable rate. • Ask for loan features that will help you if you miss a payment or if you have a good on-time record. • Create a plan for repaying your loan when you take out the loan. 26

27. Maintaining Good Credit • Check your credit report annually by requesting a free credit report from www.annualcreditreport.com or contacting the three credit reporting services. Ask to correct any errors in writing to the credit rating service. • Opt out of pre-approved credit offers by calling 888-5-OPT-OUT (888-567-8688). • Pay all your bills on time and don’t spend to your credit limit. Check to make sure that your creditors post your payments in a timely fashion. • Establish an emergency fund of 3 to 6 months. • If you’ve been denied credit, check to see if the lender has violated any laws. File a complaint if you feel this is the case. • Maintain accurate records and reconcile your accounts. Source: www.myfico.com 27

28. Coping with Credit Problems • Stay calm and work your way slowly and surely through the problem. Don’t delay. Take action now and make it a priority. • If you feel that an error caused your credit problem, tell the credit rating service. Be diligent about monitoring your credit report. • Seek financial counseling right away. Use free counseling services that are listed in www.usdoj.gov/ust. Be aware of credit counseling services (even though they claim to be nonprofit) that charge you fees. • Make a list of all the debts you owe with the creditor names and addresses. Call your lenders and creditors.Let them know you're having financial difficulties. • Prepare a realistic spending plan to pay down your debt. • If you have savings, consider using it to pay as many bills as you can. Consider selling some assets. Consider getting a second job to pay off your debt. • It might take longer than you thought for your financial crisis to go away. Be persistent with your creditors and payment plan. • As you start to pull yourself out of the financial crisis, remember to set aside money for savings. 28

29. Protect your money. 29

30. Protect your Money--Do’s • Protect all your financial information. Don’t give out your social security number unless absolutely necessary. Most places will give you another identity number if you ask for it. • Keep track of your credit card spending and check your statements very carefully.  If you find a charge for something you did not buy, contact your credit card company immediately. • Watch your debit card charges and balance your checkbook every month. In general keep good records. • Burn your mail, or use a shredder  to cut up the receipts and other papers you throw into the garbage. Don’t leave outgoing mail in unlocked mailboxes. • Avoid filling out forms for contests and clubs.   The “contest” may simply be a way for someone to collect your private information.  • Protect your computer with anti-virus software and firewalls especially if you use it for online banking or purchasing. • Don’t store financial information on web services. • Check your credit report every year. 30

31. Learn More. . . 31