Hands on Banking® Financial EducationBudgeting & Paying for College

Budgets…what a word!

Doesn’t it send chills down your spine? Somewhat like the words “test-exam” or “homework”!!

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Budget?

What do you think a budget is?

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How can a personal budget help you? A budget can help you:

Identify how you spend your $

Identify items that cost too much

Help you save for college

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Creating a budget is easy!

Budget basics

Know your income and expenses

Income = allowance, $ from odd jobs i.e., mowing your neighbor’s yard, baby sitting, pet sitting, etc.

Expenses = school supplies, snack $, movies, cell phone, clothing, etc.

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Needs and wants

Needs are items or activities you must have in order to live

Wants are things you would like to have or do but that you could live without

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Making tradeoffs

Making tradeoffs is about choosing not to buy one thing in order to buy another…making tradeoffs isn’t always easy

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Practice Let’s practice a budget activity for Angie…

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Description Income (+) Expense (-) $ Available

Earnings – babysitting and running errands

$80.00 $80.00

College fund $15.00 $65.00

Snack money $20.00 $45.00

Savings for CD player

and computer$15.00 $30.00

Entertainment/Clothes $20.00 $10.00

Angie’s 4-week budget

Wrap up on Budgeting The difference between

needs and wants

Create a budget that makes sense for you

Budgeting will help you save for other things you really want

Learn to make tradeoffs!

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That’s all there is to it!

Budgets are simple to make…and a little harder to follow

Remember a budget is like a report card…you will never reach your goals unless you apply yourself

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Paying for College

© 2010-2012 Wells Fargo Bank, N.A. All rights reserved. For public use.

What are my family’s options?

There are many options that families use to pay for college expenses.

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*Typically offered through the institution

Income

Savings

Financial aid

Tuition payment plan*

529 Plans

Federal student loans

Private student loans

Investments

Home equity

Lines of credit

What’s the best option?

The best choice is different for every family and individual situation.

What’s right for you doesn’t have to be just one option— a combination of aid, savings, loans and income might be the right choice.

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How does financial aid fit in? Many times, financial aid

is a lower-cost option for families.

Start with a visit to the school’s financial aid office in your Junior year. They’re the first source for information on grants, scholarships and aid.

It’s the focus of their office to ensure that your family can pay for school.

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Financial aid myths

Only students with a perfect grade point average get aid.

If your family has a decent income, you won’t qualify for anything.

Only great athletes get grants and scholarships.

There’s so much paperwork involved, it’s not worth the time and effort.

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Financial aid facts

Financial aid is money that:

Can come in the form of grants or scholarships that don’t have to be paid back

Could include a Work Study program

Is offered as loans.

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Getting started

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First things first

Complete the Free Application for Federal Student Aid (FAFSA). Most undergraduates need their parents’ information to complete the form.

Required in order to qualify for federal aid

Complete this as early as possible after your taxes are complete in January of your Senior year.

The results are automatically sent to the schools that you indicate.

Find the form at fafsa.ed.gov.

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Note: Check with the financial aid office for additional forms or applications that you and/or your child may need to complete.

The FAFSA online

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Types of aid

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Don’t have to be repaid

Beware of scams—you should never have to pay to do a scholarship search. Find details on finaid.org and fastweb.com

Awarded based on financial need and/or academic achievement

Don’t have to be repaid

Some are federally funded and others are state programs

Some institutions have their own private grant programs

Based on financial need

Allows students to earn income working part-time

Can work either on or off-campus

Scholarships Grants The Federal Work-Study Program

What federal loans are available?

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Need-based

Low interest rates

Fixed interest rates

Government guaranteed

Qualify for unsubsidized regardless of family income

Fixed interest rates

Cover the cost of education

Not need-based

Federal Perkins Loans

Federal subsidized and unsubsidized loans

Direct PLUS Loan for parents and graduate students

Federal Direct Loans

How much will college cost?

When planning how much to borrow, consider the following costs:

Tuition & fees: varies by school

Housing: dorm room or rent

Meals: cafeteria or groceries

Books and supplies: buy used textbooks to save

Transportation: the bus or parking pass and gas (Student loans

cannot be used for the purchase of a car)

Personal expenses: laundry, toiletries, cell bills, etc.

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Senior Year Timeline

As soon as possible after January 1, file the Free Application for Federal Student Aid (FAFSA) at fafsa.ed.gov (don’t forget to get a PIN).

Register for advanced placement tests.

Complete scholarship applications.

Watch for the Student Aid Report (the response from the FAFSA application).

January February March

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Senior Year Timeline

Compare financial aid awards

Look for additional funding if aid doesn’t cover the cost

Make sure your final transcripts are sent to the school you will attend

If you have a summer job, save money!

April May Summer

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Easy Steps to Money Success in College Create a budget

A budget, also called a spending plan, can help you see where you’re going with money

so you don’t spend it recklessly.

Reward yourself: save, save, save

Think of saving as giving a gift, or paying a reward, to you! Whenever you receive

money, put some of it into your savings right away.

Keep your money safe…and growing

You can keep your money safe by opening savings and checking accounts at a bank or

other financial institution.

Shop Wisely

Is it something you need or something you want?

Use credit to your advantage

Showing you can pay back your loans is important in order to build a good credit history

and credit score—which is important when you’re ready to buy a car, rent an apartment,

find a job, or eventually buy a house.

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More information for students and parents

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Covers the basics of good money management and the skills you need to create a brighter financial future

handsonbanking.org

Hands on Banking®

Any questions?

Thanks for your time today.

More information: studentaid.ed.govfafsa.ed.govanycollege.comcollegenet.comfastweb.com

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