Page 325 - Keys To Community College Success

get creative

GENERATE DAY-TO-DAY WAYS TO SAVE MONEY

Complete the following on paper or in digital format.

Think about all the ways you spend money in a month’s time. Where can you trim a bit? What expense can you do without?
Where can you look for savings or discounts? Can you barter a product or service with a friend? Create a list of five to ten
workable ideas.
Then, give some of your ideas a try and see how they can help you save. Describe a plan for how you will use three to five
ideas right away.
Consider making the experiment tangible by putting cash into a jar daily or weekly in the amounts that these changes are
saving you. See what you have accumulated at the end of one month—and bank it.

In response to rising education costs, students are borrowing ever-larger amounts
of money. Consequently, the number of students defaulting on loans (walking away
from them without paying) is on the rise, and even personal bankruptcy won’t make
student loans go away. The consequences for defaulting on a loan are severe and
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include credit trouble, inability to apply for further aid, money taken from your salary
or social security payment, and more. Borrow only what you need. For helpful infor-
mation about managing loans, see www.finaid.org.
Student loans are one way of borrowing the money you need to live and study.
Next, look at a much more expensive form of borrowing—credit cards.

WHAT WILL HELP YOU USE CREDIT
cards and debit cards wisely?

The typical college student receives dozens of credit card offers. These offers, and
the cards that go with them, are a double-edged sword: They are a handy alternative to
cash and can reward you with a strong credit history if used with a reasonable level of
risk. But they also can plunge you into a hole of debt. Students are acquiring cards in
droves. In fact, in 2009, only 2% of undergraduates had no credit history. 14
Credit cards are a particular danger for students. Credit companies often target
students by presenting a positive spin about credit cards, knowing that many students
lack knowledge about how credit works. Too much focus on what they can purchase
with credit cards (rather than how much it will really cost them) leads students into
trouble because they spend more than they can afford. Recent statistics from a survey
of undergraduates illustrate the situation. 15
■ 84% of all students have at least one credit card and 50% have four or more
credit cards.
■ Students who hold credit cards carry an average outstanding balance of $3,173,
and seniors graduate with an average of $4,100 in credit card debt.
■ 82% of students don’t pay their cards in full each month, and therefore pay
finance charges.
■ 90% of students pay for some type of education expense on credit, including
76% who charge textbooks and 30% who use cards to pay tuition.

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