Is College Worth The Cost?

During this long (but mercifully winding-down) campaign season, much has been said about the $1 trillion amount in student loan debt that American college graduates (and non-graduates) collectively owe either private lending institutions or the federal government by political candidates from both major political parties. What’s more, both the general and individual economic impact of this staggering amount was made all the more relevant during the recent economic downturn, as the educated (and uneducated) have struggled to find work in the midst of high rate of unemployment across the country.
Because of this, the question of whether or not a college degree is worth the investment in time and especially money has also become an issue in these lean economic times. For those thinking of taking the plunge into working toward a college degree (or those completing a degree), there are many factors to consider in making sure whether or not the investment in an education will pay off for you.

 Is college worth the cost? Watch the recent piece on NBC's "Today Show" to view considerations to consider.

Like others, my own college experience turned out to be rather expensive, especially considering that I attended a much costlier private school in lieu of a less expensive public institution. However, I know that I would have ended up much more if I hadn’t (1) attended a community college first; (2) hadn’t maintained a respectable grade point average of 3.52; and (3) looked for and received many scholarship, most of them merit- and academic-based (some $20,000 by my recollections).
Like many others during the recent economic downturn, I found myself negatively affected. But I was one of the lucky ones; in addition to a college degree with a double-major, I managed to obtain other useful credentials which supplemented my ability to secure work, even in leaner economic times (such as my commercial driver’s license).  And given my varied experiences, I managed to do OK for myself during the downturn.  However, many young people in the most recent graduation years have had far less success in securing stable employment with their college educations.
For those both considering enrolling in college to facilitate a more financially-stable career change and those who are recent graduates looking for work, there are questions you should ask yourself when assessing whether your degree can/will work for you (or against you).  Among the questions you should ask yourself are:

What are my primary reasons for attending college? 

What do I want to major in? 

What will my degree worth in the employment market after I graduate? Am I 100% certain about my major/career choice? 

Will I be benefit from starting out in a two-year college? 

Will I be comfortable at a large university? 

Is a private college a good choice for me? 

How much can I afford to spend or borrow on college?/What are my options for paying for college? 

Do I plan to work while attending college? 

What geographic area do I prefer? 

Will I live on campus, with my parents, or in an off-campus apartment? 

What type of work would I like to do after college? 

Will graduate study after be necessary in order to be marketable? 

All of these questions have an impact on what you can expect to pay (or borrow) in order to finance a college education.
Another thing to consider is career path you choose, based on your college major.  Simply put, some degrees are worth more than others.  According to a recent survey by the online salary database Payscale.com. the worst-paying college degrees of 2012 are:

Child and Family Studies Median Annual Salary: $37,700 

Social Work Median Annual Salary: $45,300 

Elementary Education Median Annual Salary: $46,000 

Human Development Median Annual Salary: $47,800 

Special Education Median Annual Salary: $48,900 

Culinary Arts Median Annual Salary: $49,700 

Athletic Training Median Annual Salary: $49,800 

Of course, these average median salaries are only averages; they may be higher or lower depending the geographical area of the country where demand rises or falls.  However, if you are determined to set your path toward a college education, there are steps and strategies you should expect to take to begin securing funding for your education, and lessen the pain in the wallet you can expect to contribute.

1. Apply for financial aid (even if you don’t think you'll qualify, fill out the Free Application for Federal Student Aid [FAFSA] form).

2. Apply for national grants (options include Pell Grants, Academic Competitiveness Grants and National SMART Grants).

3. Apply for local scholarships (civic organizations and religious institutions often have funds set aside for merit and non-merit-based scholarships).

4. Bargain (even schools that only provide need-based aid sometimes come up with drastically different offers. If you have more than one package on the table, you may be able to negotiate a better deal at another college).

5. Find an official benefactor (AmeriCorps, Peace Corp, National Health Services Corps and ROTC programs offer college money in exchange for a service commitment).

6. Look abroad (tuition and fees at U.S. private four-year colleges and universities now averages $27,293. At Scotland’s St. Andrews, the alma mater of Britain’s Prince William and wife Kate, U.S. students pay only $21,650; Canada's McGill University charges just $17,400 for Americans studying for a B.A.). 

7. Live at home (starting out at a low-cost community college and transferring to a four-year college for the final two years will wipe away a hefty chunk of room and board costs, as well as some tuition).

8. Inquire your employer about a tuition reimbursement plan which pays for some or all of your courses. Some companies will pay for their employees to attend college part-time.

If you would like to focus your search for college money in the realm of scholarships, there are literally dozens of sites you can use, such as http://www.salliemae.com/scholarships or http://www.finaid.org/scholarships/ . However, you should be aware that many of these sites require you to register with a valid e-mail address (and whereby you can expect to have your inbox/spam box flooded with junk e-mail). But it should be noted that finding scholarships is not a sure thing (Read: "On Hunting for Scholarships, and Coming Up Empty").  And on this note, please make an effort to seek out specialized scholarships for certain demographic groups.
 
Scholarships for (single) moms seeking to attend college

Ultimately, it is up too you to determine whether or not college is for you, or worth the investment in time and money.  My advice is to make sure that your career choice is something that is both personally rewarding, as well as financially sound insomuch as your ability to earn a living.  In addition, consider continuing education course leading to certifications...never stop learning.  Every bit of experience you can gain makes you that much more marketable and able to make your decision to attend college to pay off.

Time To Think About Cold Weather...And Heating Bills

The seasons are changing…again. The days are getting shorter and the nights colder. That means our furnaces and space heaters will be getting more of a workout. It also means that we can expect to see an increase in our utility bills as a result.
This is the time to begin thinking about saving money on those utility bills. Even if money is an issue when considering ways to cut down on your energy bills, there are upgrades which you can do yourself for less than $50 dollars each.
One of the best ways to stop cold drafts from sucking the heat out of your home is the buy a door sweep (I love these things). These handy little items attach to the bottom of your door to keep the cold air out, and the heat in. Door sweeps come in different variations, including those that attach with screws and those with self-stick adhesive backs. If buying one of these is financially problematic for you, consider attaching a thin piece of rubber to the door base; it has the same effect.
To stop air from seeping of your fireplace and out of your home, use a chimney plug. These simple, air-filled items usually average around $50 dollars in cost, and only take a few minutes to inflate and install.
Lighting is another area to cut energy costs. Newer, more energy efficient “green” light bulbs can now outlast the more traditional iridescent bulbs by a factor of 10, and can cut your lighting cost by upwards of 75%. Florescent bulbs, although not as environmentally friendly also have the same effect…more lighting for half the costs. Other efficient options include CFLs, LEDs and halogen bulbs.
An old trick my father used to do was to wrap a blanket around the hot water heater. This old trick helps make your hot water heater run more efficiently. You can actually purchase a “hot water ‘blanket’” from a hardware store for around $20 dollars. It’s almost idiot-proof to install, and helps to keep the water inside the tank warm, which means the water heater won’t have to work as hard.
These small investments will yield big returns when it comes to your utility bills. Taking a few minutes to think about and prepare for the colder weather now will save you a headache of a bill (or bills) later.

The Higher Costs of Banking...And How To Avoid it!

Those of us old enough remember the early 1980s. Interest rates were high, which made borrowing money from and paying it back to banks extremely costly. The upside to this was that banks also paid out higher interest on personal saving accounts, which was only fair since banks were making money off of the personal deposits of its depositors, both large and small. However, to offset the higher interest they were paying to customers who had savings accounts with their banks, small banks began imposing fees on these accounts. Then in the late 1980s, these small banks began to lure customers with free checking when their customer base began to thin out. Soon, the larger banks got into the act as they tried to siphon off the increasing numbers of customers the smaller banks winning over. The result was that by the mid- to late 1990s, free customer checking had become a banking industry standard.
But in recent years, the trend has been reversing. According to figures released by a Bankrate Inc. survey last month, only “39% of noninterest checking accounts are free to all customers, down from 45% in 2011 and a peak of 76% in 2009.” And although last-year’s public outcry forced banks to back away from the imposition of new fees when they were proposed last year, it hasn’t stopped banks from doubling-down on existing fees. The majority of banks have raised their fees on ATM transactions, checking account overdrafts, and minimum-balance amount fees. The result is a landscape of new and oftentimes imaginative fees. For example:

• The recent fee change at SunTrust has resulted in a $36 fee on all basic checking overdrafts, an increase from the $25 for-the-first overdraft, and $36 for each subsequent payment.

• Wells Fargo customers must now keep $1,500 in their basic checking accounts or make $500 in direct deposits each month to avoid a $7 monthly fee.

• U. S. Bank will charge a $15 fee for an overdraft transaction that is $15 or less, and $35 for any overdraft over that amount.

• In June, Fifth Third Bank began charging $37 per overdraft after a $25 fee is assessed for an initial overdraft transaction. This replaces old policy of charging a $33 fee for the second, third, and fourth overdrafts in a twelve month period.

 The reason often cited for the introduction new banking fees are simple. For starters, we must remember that banks are in business to seek profit. As such, they are beholden to their shareholders to ensure that turning a profit is the end result of their daily business transactions. Secondly, banks are attempting to recoup losses as a result of federal legislation in the form of the so-called Durbin Amendment.
The amendment, a last-minute addition to the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 cap on the fees bank could charge retailers such as Target each time a customer used their debit card there. The bill lowered swipe fees – the fee charged to merchants every time a customer pays with plastic – on debit cards issued by big banks. Whereas before the introduction of the Durbin Amendment, debit-card issuing banks would take a small percentage of that total from retailers whenever a customer would make a purchase with their debit cards, banks are now limited to charging retailers roughly 23 cents per swipe. That particular lowered revenue stream for banks forced them to make up the profit loss in—you guessed it—charging you and I higher fees as the cost of doing business with banks.

Click to enlarge graphic

The result is a list of big banks charging higher fees.  Examples include:

1. Bank of America 

• Checking: $25 deposit to open; $8.95 monthly fee unless statements are paperless and deposits/withdrawals are done online or by ATM. 

• Debit Card: Included with all checking accounts (no additional fees). 

2. Wells Fargo 

• Checking: $100 deposit to open; $5 monthly fee unless direct deposit or average balance of $1,500. 

• Debit Card: Included with all checking accounts (no additional fees). 

3. J.P.Morgan Chase 

• Checking: $25 deposit to open; $12 monthly fee unless direct deposit of at least $500, minimum balance of $1,500 or $5,000 average daily balance in linked accounts. 

• Debit Card: Included with all checking accounts (no additional fees). 

4. Citigroup 

• Checking: $0 to open; $10 monthly fee unless balance of at least $1,500 in prior month or one direct deposit and one bill payment each month. 

• Debit Card: Included with all checking accounts (no additional fees). 

5. US Bank 

• Checking: $50 to open; $6.95 monthly fee with online statements or $8.95 with paper statements unless direct deposits of at least $500 or average account balance of $1,500. 

• Debit Card: Included with all checking accounts (no additional fees). 

6. PNC 

 • Checking: $25 to open; no monthly fee. 

• Debit Card: Included with all checking accounts (no additional fees). 

7. TD Bank 

• Checking: $0 to open; $2.99 monthly fee with online statements or $3.99 monthly fee with paper statements. 

• Debit Card: Included with all checking accounts (no additional fees). 

8. Capital One 

• Checking: $50 to open; $8.95 monthly fee unless $300 minimum daily balance or monthly direct deposit of at least $250. 

• Debit Card: Included with all checking accounts (no additional fees). 

9. SunTrust 

• Checking: $100 to open; $7 monthly fee unless minimum balance of $500 or direct deposit. 

• Debit Card: Included with all checking accounts (no additional fees). 

10. BB&T 

• Checking: $50 to open; $10 monthly fee unless direct deposit of at least $100, $1,500 average balance or a mortgage with BB&T. 

• Debit Card: Included with all checking accounts (no additional fees). 

So how can you and I avoid paying higher fees for the cost of banking? First, watch a recent segment (below) from NBC’s “Today Show” for starter for some tips.

Second—and in the immortal words of Smokey Robinson—“shop around!” Banks by law must make their account fee schedules available for you. I’ve already provided a partial list of the largest banks and their customer account fees.
Some banks have policies that result in few, if any problems in accessing their information on their checking account fees.  However, there are banks with whom you may have to dig a little deeper than picking up a simple brochure in one of their branch offices (see:  "Banks That Play Hide-the-Fee, And Those That Don't").  Also, consider the following suggestions:

-Consider a credit union.  Credit unions are not-for-profit, and aren't under pressure to nickle and dime their customers to satisfy their stock-holders.  For the most part, their account fees are usually lower than banks, and their overdraft fees tend to be better.
-Bank online.  Big banks typically maintain a physical presences in the form of a building and their branch offices...which cost them money to maintain.  Guess where the cost of maintaining these money houses is shifted?  Online-only banks often have the best terms and conditions. Because some of these banks have no physical branches to maintain, they are able to offer better rewards and charge fewer fees. However, many traditional banks have online-only accounts too. Bank of America’s eBanking account has no minimum balance requirement and waives the monthly fee if you agree to do all your banking via the Internet and ATMs.
-The most obvious--Meet the minimum or average balance requirements. This is easiest way to avoid the monthly fee at banks.  Maintain the minimum balance, and avoid withdrawals which result in lowering the balance below this point, except in emergencies. Shop around for the banks with lower minimums.
-If your one of those individuals who has no problem maintain larger balances, consider depositing your money into an interest checking account. Most banks do not pay interests on accounts unless you are able to maintain the monthly (or daily) minimum.
-Sign up for direct deposit. If you can’t maintain the minimum monthly balance requirement, you may qualify for free checking by authorizing one or two direct deposits to your account each month. If you get a regular paycheck, your employer or sponsoring agency can help you set it up. Like a minimum balance requirement, direct deposit encourages you to keep money in your account, and banks like that. It tells them they can invest your money and use it to make loans, so your account is more likely to be profitable without extra -Avoid overdraft protection. This is one of the biggest rip-offs to banking customers there is. Don't be afraid to ask the banks you're interested in whether they require their customers to have this service (as a result of the Electronic Fund Transfer Act, bank customers must now choose whether or not they want to opt into overdraft protection).  If they don't, by all means consider this bank seriously.  Otherwise, avoid this "protection." The average overdraft fee is $20 to $30 per transaction.
-Look into banks which offer special discounts to college students, seniors, veterans, or other groups. That alone is worth at least four lattes. Chase, for example, offers a checking account especially for college students that works just like their regular Total Checking account, except it will waive the monthly fee for students.

If you find yourself on the verge of being nickled-and-dimed into living paycheck-by-paycheck—the death of a thousand financial paper cuts—you don’t have to settle! If you don’t like the account you have now, or don’t like what you’re paying, by all means change banks! Don’t like the way your bank is treating you? Can’t set up direct deposit or meet the minimum monthly balance requirement? Take a look at what’s available in your neighborhood; your local credit union or community bank may be able to offer you a better deal. I It’s your money, so make sure it works for you.