At DSDT, we are dedicated to your overall success which included your financial well-being. Financial literacy is an essential skill that empowers you to navigate the complexities of student loans, budgeting, and debt management with confidence. Whether you are a current or prospective student, or a recent graduate, our goal is to equip you with the information and resources to achieve your education goals and secure a sound financial future. Explore the valuable content and tools on this page, and take the first steps towards building a strong financial foundation for your future.
A budget is a financial plan that helps you track and manage income and expenses. Budgeting provides a clear picture of where your money comes from and where it is going, creating informed decision making. A well crafted budget is a valuable tool for achieving your goals and ensuring financial success.
Six Budgeting Tips
Begin by identifying your financial objectives. These could range from paying off student loans, saving for a vacation, or building an emergency fund. Setting clear, achievable goals provides purpose and motivation for budgeting.
Create categories for your expenses, such as housing, transportation, groceries, entertainment, and savings. Categorization helps you understand where your money is going, making it easier to manage and control your spending.
Keep a detailed record of all your income sources and expenditures. This step allows you to see the full financial picture. Use a budgeting tool, app, or spreadsheet to streamline the tracking process.
Distinguishing between essential needs and discretionary wants is crucial. Needs include items like rent, utilities, and groceries that are necessary for daily living. Wants, on the other hand, are non-essential expenses like dining out or buying the latest gadgets. Being honest about what’s truly necessary can help you prioritize spending.
Regularly assess your budget to ensure it aligns with your financial goals and reality. Life circumstances change, and your budget should adapt accordingly. Make adjustments if you encounter unexpected expenses or income fluctuations.
Discipline is the cornerstone of budget success. Commit to following your budget, avoid impulse spending, and make conscious financial decisions. Sticking to your budget helps you achieve your goals and maintain financial stability.
get started with budgeting today
Traditional budget tracking sheets can enhance and streamline your budget management
process. Here’s a budget tracking sheet that you can print and complete to get started.
https://www.balancepro.net/pdf/fritter.pdf
Credit is a crucial factor in financing, serving as your borrowing track record. Proficiency in credit management empowers you to establish a stellar credit profile. Start building your credit profile now to create a better financial future.
things to know about credit
A credit report is a detailed report of your credit history and details your personal information, employment history, and a list of credit accounts. Each year, you can get a free copy of your credit report from the three credit bureaus: Equifax, Experian, and Transunion. To redeem your report go to annualcreditreport.com. A credit score is a snapshot of your credit risk at a specific point in time and is based off your credit report. Credit scores range from a low of 350 to a high of 850. A higher credit score means lower credit risk for lenders, resulting in lower interest rates while lower credit scores result in higher interest rates as risk for lenders increases. Having good credit history allows you to pay less for private loans, credit cards, insurance, apartments, and auto loans.
The Components of Credit Score
Your credit score is determined based on the following components:
1. Payment History (35%) Payments more than 30 days late remain on your credit report for 7 years and can drop your credit score by 90 points or more.
2. Utilization (30%) Credit used should be less than 30% of all credit available/total credit limits
3. Credit Length (15%) Lenders look to see long relationships with other lenders to show reliability
4. Inquiries (10%) Applying for new credit causes your score to drop a few points. Applying for a lot of new accounts at once can cause a substantial impact. Hard pulls remain on credit report for 2 years.
5. Mix of Accounts (10%) Lenders seek borrowers with a diverse range of accounts all in good standing because it shows that you are a responsible borrower. Numerous accounts with late payments signify difficulty in handling multiple financial commitments, potentially leading to credit application denials or higher interest rates.
Resources/Information
CAREER VANTAGE ™
A certificate program designed for those who simply do not have the time.
Are you aware of the tax benefits for education?
Find out here.
Tax benefits for education
American Opportunity Credit – Gives eligible tax filers a credit of up to $2,500 per student based on the qualified education expenses paid during the tax year. Can only be used up to four years per eligible student. Lifetime Learning Credit – Gives eligible tax filers a credit of up to $2,000 per student based on qualified educational expenses paid during the tax year. Lifetime Learning Credit does not have a limit on the number of years it can be used. Tuition and Fees Deduction – Qualifies eligible tax filers for a deduction of up to $4,000 from your AGI based on qualified educational expenses during the tax period. Can be claimed for multiple students with a maximum deduction of $4,000. Student Loan Interest Deduction: Allows eligible tax filers who are making student loan payments on an education loan that is accruing interest to deduct some or all of the interest paid during the tax period from your taxes, up to $2,500 per student.
Link to more information
http://www.irs.gov/Individuals/Education-Credits
http://www.irs.gov/publications/p970/
What does the IRS count as Qualified Education Expenses?
Qualified education expenses, per IRS guidelines, are expenses paid directly to for tuition, fees, and other educational expenses. Room and board, insurance, medical expenses, transportation, and personal/living/family expenses.
Deductions reduce the amount of income that you have that is subject to tax.
http://www.irs.gov/Individuals/Qualified-Ed-Expenses
If you’re contemplating loans, it’s essential to adopt smart borrowing practices. This entails borrowing only what you genuinely need and seeking grants and scholarships to replace loans whenever possible. Keep in mind that loans come with an obligation to repay. Failure to meet your financial commitments can result in adverse consequences such as poor credit, debt collection, and wage garnishment.
Lending terms you should know:
A loan servicer guides students through the repayment process, and it may differ from your lender.
Deferment offers a temporary pause on loan payments, often due to economic hardship or specific situations like active duty, enrollment in graduate school/continuing education, or certain career paths.
Forbearance provides temporary pauses on student loan payments, typically due to economic hardships.
The repayment term indicates the maximum time allowed to repay your loan. The standard term for education loans is typically 10 years, but making prepayments or paying more than required can shorten this term and reduce interest.
Default occurs when a borrower fails to repay a loan according to the terms of the Master Promissory Note (MPN) and can negatively impact your credit score and academic progress.
The grace period is the time between dropping below half-time enrollment or graduating and when your first student loan payment is due.
These loans have interest that doesn’t accrue while attending school or during deferment, and the lender pays the interest.
Interest begins to accrue immediately after disbursement (including during school) and is the borrower’s responsibility.
Student Loan Options:
Federal Direct Stafford Loan: Available for U.S. citizens and permanent residents, the amount you can borrow depends on enrollment status, class standing, and FAFSA components like need and estimated family contribution. PLUS Loans: The Parent Loan for Undergraduate Students (PLUS) Loan is available for parents of undergraduate students to cover educational costs.
Private Student Loans: These loans, offered by third-party lenders, are available to students but typically require a co-signer and are credit-based. Note that private loans may lack the protections of federal loans, so consult your financial aid office before applying.
Borrowing Alternatives:
Institutional Payment Plans: Explore monthly payment plans offered by your institution, allowing you to spread tuition and fee costs over an extended period.
Scholarships: Seek external scholarships or apply for institutional scholarships to alleviate financial burdens.
Important Reminder:
If you encounter difficulties in making student loan payments, contact your loan servicer promptly for assistance. Remember that the repayment process commences once you drop below half-time enrollment or leave college entirely. Contact both your financial aid office and loan servicer to discuss repayment or deferment options. Repayment obligations apply whether or not you complete your program.