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Chapter VI

Money Management

Page 99

Tom Wells, a financial seminar instructor for Crown Financial Ministries developed a classic value vs. cost chart.  The chart (not shown here) illustrates that the most cost-effective period to purchase a vehicle is when the car is between 3 and 4 years old. Comparing depreciation and life expectancy, it’s at that point where the cost of the automobile vs. the vehicle’s value reaches an optimum.

(NOT IN THE BOOK)

Pages 102-103

AVOIDING FINANCIAL BONDAGE

A DEGREE AND $55K IN DEBT  (NOT IN THE BOOK)
Heather Schopp in California has nightmares about her student loan debt.  But then why not?  How many people owe $65,000 right out of college?  There is hope however.  For more log onto Find Alternatives.

STUDENT LOAN PLAGUE
Students are allowed to borrow up to $138,500 in government-backed loans without any known source of income or credit. Today, many ask themselves, “Is it worth it?”  A recent survey found that 54 percent said they would borrow less if they had to do it over again. Read the full article in Money Matters.

THROW THE RED FLAG ON CREDIT CARD DEALS  (NOT IN THE BOOK)

Here's a three-part series that first appeared in 2007 called, "The Dirty Secret of Campus Credit Cards."  It's well worth the read.  Don't get caught in the infamous credit card trap.  Check out Credit Cards 101.

SPENDING PLANS AVOID STUDENT DEBT
A well-thought-out spending plan, or budget, is critical for students wanting to graduate with the least amount of debt.  Writing for Nellie Mae, Kathleen Gibbons notes that, "A budget (the noun) is simply a list of your resources, minus your expenses, generally recorded on a monthly basis. But budgeting (the verb) is something more. The act of budgeting also means identifying goals, such as saving for a vacation over spring break, or buying a used car, or simply having enough money to pay your bills and have pizza money every weekend, and making adjustments as needed to help meet your goals."  Click on Trials and Triumphs.

STUDENT LOANS AND YOU?
Writing for Boundless Webzine, author Heather Koerner paints a remarkably clear picture of what it's like when colleges offer student loans so freely, which invariably end up not so free after graduation.  See the full article called Debt, Diapers and You at Count the Cost.

TIPS ON CUTTING COLLEGE COSTS
High school students should read the following article on how to reduce the overall cost of attending college. Check out Crosswalk.

COLLEGE FUNDING
To view an article on college finances originally published in Larry Burkett's Money Matters, click on College Funding.  This is a PDF file.  If the file fails to open, download Acrobat Reader, free from Adobe.

CREDIT CARD DEBT STALKS STUDENTS
"University students are amassing record amounts of debt on credit cards," writes Mark Helm of the Hearst Newspapers. "...many young people will be spending their earnings paying off debt at the very time they should be socking away money for their future." Log onto Student Debt.  See a new research report from Nellie Mae.

NEW CREDIT CARD REPORT

Credit card use by college students in 2009 is increasing according to a new survey released by Sallie Mae. According to the report, 84 percent of undergraduates had at least one credit card, up from 76 percent in 2004, the last time the study was conducted. The average number of cards has grown to 4.6, and half of college students had four or more cards. In addition, undergraduates are carrying record-high credit card balances. The average (mean) balance grew to $3,173, the highest in the years the study has been conducted. Median debt grew from 2004’s $946 to $1,645. Twenty-one percent of undergraduates had balances of between $3,000 and $7,000, also up from the last study.