Ed Bove-Beacon Blog

Would a puppy make things better?

As parents of college-bound students, we all get so wrapped up in grades and test scores and the like.  Maybe what we really need to give our kids is a puppy!  A recent article on the WebMD website suggests that pets help provide pupils with companionship and relieve stress as they cope with college lift.  This may be especially true for freshman as they deal with the whole transition to college life.  So next time we think our kid needs a tutor, maybe all they really need is a terrier.

Here's the article:

Pets Comfort College Students

College Students Get Companionship, Activity, Stress Relief From Their Pets

By Miranda Hitti                                    Reviewed by Louise Chang, MD  
WebMD Health News

Dec. 26, 2008 -- Pets may be a source of stress relief, as well as companionship, for college students, a new study shows.

The study included 241 students, mainly freshmen, at a commuter college in the Midwest. About 100 adults age 30 and older in the same area, but not affiliated with the college, also took part.

Participants completed a survey which included questions about pets. The group included 98 dog owners, 42 cat owners, 97 people with both cats and dogs, and 74 people with other pets.

When asked why they had pets, companionship was the most common reason for people of all ages; those people said they would be lonely without their pet.

The second most common reason was that their pet helps keep them active. And the third most common reason was that their pet helps them "get through hard times."

College students were more likely than the older participants to say their pet helps them get through hard times. That may be because college freshmen are in a transition period and haven't yet built their social network and resources for coping, note the researchers, who included Sara Staats, PhD, professor emeritus of psychology at Ohio State University.

"College is a very stressful environment for them and sometimes they can feel isolated or overwhelmed with the change," Staats states in a news release. "Many feel their pets will help them get through these difficult and stressful situations, and many more say that without their pet, they would feel lonely."

Writing in a recent edition of Society and Animals, Staats and colleagues conclude that, although the students in their study may not represent all college students, "pets provide important benefits to young persons as well as the better-known benefits provided to the lonely, elderly, or ill."

Bad economy to push tuition even higher, survey shows

Just as many individuals have lost money in the current economic downturn, so have a number of colleges and universities.  As a result, many plan to raise tuition again in 2009 to make up for the shortfall.  Here is an excerpt from an article by Peter Schworm in today's Boston Globe:

Bad news for families already getting sticker shock looking at tuition prices: Brace yourself.

More than two-thirds of private colleges plan to raise tuition next fall in the wake of heavy financial losses, according to a new national survey of private college and university presidents. Just 5 percent said they have frozen tuition or were considering doing so, the National Association of Independent Colleges and Universities found.

Colleges have instituted a range of cost-cutting to offset endowment declines, with nearly half planning to freeze hiring, slow down construction projects, and restrict travel.

The survey found near-universal economic anxiety among college presidents, who cited potential declines in fund-raising, endowment value, and enrollment as major concerns. Other fears included high debt burdens and reduced availability of student loans.

College presidents expect the recession to dampen immediate enrollment, with nearly half predicting a decline of up to 10 percent for the spring term. Seven percent expect to see a decline of 11 percent or more. Thirty-one percent of respondents projected no change in enrollment, while 13 percent anticipated an increase.

The association's president, L. David Warren, reassured families that private colleges planned to do their best to provide sufficient financial aid, and urged families not to rule out colleges because of their listed price.

"Our institutions are well aware of the financial pressures facing families, and are doing what they can to help," he said. "Private colleges are redoubling their efforts to offer a quality education at an affordable price to students from all backgrounds."

Survey shows Rutgers graduates get their money's worth

Rutgers University ranks 6th in the nation in providing the biggest return on investment for their students, according to a recent survey published in a leading financial magazine.

The survey comparing the cost of college to the salaries earned by graduates at 50 public and private schools, placed Rutgers at the head of the class in the Northeast.  An article in the January issue of SmartMoney magazine looked at what students earned 3 years and 15 years after graduation compared to what they paid in tuition.

The data showed that the median salary of in-state Rutgers graduates was $50,300 after 3 years and $91,800 after 15 years, which was the highest among public universities from the Northeast included in the survey.

To come up with its rankings, SmartMoney used data from a recent survey conducted by PayScale.com, an online salary database.  The magazine then divided each of the post-graduation salary figures by the school’s degree cost at the time the students attended the institution.

In the study, public institutions outscored all of the private schools surveyed – including Ivy League schools – on their return on investment.  While graduates of private schools earn more money on average than graduates of public schools, they have higher tuition payments, which brought down their return on investment.

Ahead of Rutgers in the rankings were the University of Georgia, Texas A&M, University of Texas, Georgia Tech and University of Washington.

NJ Class loan payments can no longer be deferred

The news just keeps getting worse.  Students will no longer be able to defer payments on their NJ Class loans until after graduation, according to a Page One story in today's Star-Ledger.  (See excerpt below.)  This development comes just as other lenders are either pulling out of the student loan business or restricting the amounts that can be borrowed.  So instead of focusing on their classes, students are going to have to start worrying coming up with money to start paying back their loans.  That will surely make for a good learning environment!

This just further exemplifies the need to map out your college funding strategy in advance so you don't get caught short or unprepared in these turbulent times.

N.J. agency overseeing college aid won't let students defer loan payments

by Ana M. Alaya/The Star-Ledger

Wednesday December 17, 2008

The state agency overseeing more than $1 billion in college financial aid will no longer allow students to defer payments until after graduation -- a move that could affect thousands of students at a time when it is getting increasingly difficult to secure loans elsewhere.

Changes to the NJ Class loans -- something of a safety net for families who cannot borrow enough through other federal and state loan and grant programs to cover the cost of school -- comes amid a growing crisis in the student loan industry.

The program, overseen by New Jersey's Higher Education Students Assistance Authority, is in better shape than most; the authority was able to secure funding for more loans unlike many other states that have failed to do so.

But a dramatic increase in the number of new applicants -- up 21 percent over this time last year -- and an increase in the number of students attempting to defer payments caused lending restrictions to automatically kick in.

"The continuing recession is certainly having an impact on student borrowing," said Michael Angulo, the assistance authority's executive director.

The loan program is popular because it has a relatively low, fixed-rate of interest -- unlike some private loans that come with onerous variable rates. In the last academic year, more than 25,000 families relied on the program to supplement federal and state aid and grants.

New Jersey residents headed to college in-state or elsewhere are eligible for the loans, as are out-of-state residents attending New Jersey schools. Parents or students can apply to borrow up to the full cost of school, including textbooks, room and board. The average loan last year was $13,900.

Before late last month, NJ Class borrowers could defer payments on the loan principal and interest until graduation. In typical years, about 40 percent to 45 percent of the borrowers chose this option, but this year it grew to 50 percent -- the maximum allowable under terms of the bond that funds the program.

As a result, new borrowers will be forced to make principal and interest payments, or just interest payments at a higher rate, while enrolled.

Fewer will qualify for aid program under new state proposal

If you were counting on the NJ Stars programs to help you pay for college, you may need to rethink your strategy.  It's going to be harder than ever to qualify for this merit-based aid program under a bill passed by the state legislature today.  The cost-cutting measure will impose stricter income limits on families and higher academic standards on students.  Please read the following AP story for further detail:

N.J. lawmakers limit college aid program

by The Associated Press

December 15, 2008

Fewer New Jersey students will qualify for merit-based college scholarships under limits designed to preserve the program and save the state money.

Revisions to NJ STARS and STARS II will take effect next year if Gov. Jon S. Corzine signs the measure as expected. The Assembly and Senate approved the bill today.

The proposal tightens eligibility standards and excludes families earning more than $250,000 from eligibility. Corzine sought to limit participation to families earning less than $100,000.

STARS grants full community college scholarships to 4,100 high school students in the top 20 percent of their class. The proposal cuts eligibility at the top 15 percent of students.

STARS II provides $4,000 scholarships to four-year colleges and universities to 1,200 STARS participants who graduate with a community college grade-point average (GPA) of 3.0 or higher. The proposal raises the GPA to 3.25 and caps the total scholarship amount at $7,000.

6 Tips for saving on your taxes before the year ends

Can you believe 2008 is almost over? And although most people don’t like to think about their taxes until April, NOW is the perfect time to review your situation to make sure that you are paying the lowest amount allowed by law. With that in mind, here are 6 things to consider doing before the year is out to help you save big money on your taxes.

1. Sell Some of Your Stocks

First of all, if you have any money in the stock market, you’ve probably lost plenty with the current economic situation. If you have after-tax stocks or mutual funds (meaning they’re not inside a retirement plan like an IRA or 401(k) that are down in value, you can sell them, and you are allowed to write off $3,000 of the loss against your current earned income. If you are in the 25% tax bracket, that means that you will save $750 on your federal taxes come April 15th. And, if you really like the stock, you are allowed to buy it back 31 days later, and still take the write off.

2. Invest for Retirement

I know, I know…this sounds like exactly the opposite of the previous tip, but if you have any extra cash around, now is the time to put it into an IRA or your 401(k) at work. You will get the double benefit of a tax write off for this year (if you qualify), and you’ll be buying when the market is down, or on sale. So each dollar invested will purchase more stock or mutual fund shares than it would if the market was high.

3. Get any Medical Tests or Work Done

Again, you have a double benefit here if you spend a lot of money on medical bills. First, if you’ve already met your health plan’s deductible, you will get your care covered versus if you waited until after the first of the year when you might have to pay a new deductible. Also, if you have medical bills that exceed 7.5% of your adjusted gross income and you itemize, you are allowed to write off anything in excess of that, thus saving the taxes on that money as well.

4. Prepay Expenses

Certain expenses, like your January mortgage payment, can be paid in December, and you’re allowed to take the deduction for this calendar year. Other expenses in this category include state or property taxes. Also, if you own a business, you can buy equipment that you’ll need next year and take the write off  for that as well.

5. Defer Income

Technically, you only have to pay tax on income received by the end of the year, so if you have any leeway on how or when you get paid, you can choose to have that money pushed into the upcoming year. If you own a business, that may mean sending your invoices in late December, so the income doesn’t actually hit until January. However, keep in mind, you’ll still have to pay the taxes on the income next year.

6. Get Married

Even if you get married on December 31^st at 11:59 p.m. by an Elvis impersonator in Las Vegas, the government considers you married for the entire year, and allows you to take the appropriate (often higher) credits and deductions. So, if you’ve been thinking about tying the knot, what more romantic reason could you think of for doing it this year than saving money on your taxes!

These tips should give you some things to review and think about. Remember that a little bit of planning now can save you a bunch of money come April 15^th.

Also, don't listen to the media that keep talking about how no one is going to be able to afford college this year, and for the next few years. There's still plenty of money available if you know where to look for it. So, be sure to check out my website if you've got a student getting ready to go to college for a complete list of my workshops on How to Pay for College Without Going Broke.'  www.BeaconCollegePlanning.com