Warm Up Do you know anyone with student loans? What questions do you have about student loan debt? Look at the cartoon below. What are your thoughts on what it might be saying?

Please pick up a loan handout Look at the different types of loans and then answer #1 Share with a partner 2 minutes

Federal Student Loans Private Student Loans You will not have to start repaying your federal student loans until you graduate, leave school, or change your enrollment status to less than half-time. Many private student loans require payments while you are still in school.   The interest rate is fixed and is often lower than private loans—and much lower than some credit card interest rates. View the current interest rates on federal student loans. Private student loans can have variable interest rates, some greater than 18%. A variable rate may substantially increase the total amount you repay. Undergraduate students with financial need will likely qualify for a subsidized loan where the government pays the interest while you are in school on at least a half-time basis. Private student loans are not subsidized. No one pays the interest on your loan but you. You don’t need to get a credit check for most federal student loans (except for PLUS loans). Federal student loans can help you establish a good credit record. Private student loans may require an established credit record. The cost of a private student loan will depend on your credit score and other factors. You won’t need a cosigner to get a federal student loan in most cases. You may need a cosigner. Interest may be tax deductible. Interest may not be tax deductible. Loans can be consolidated into a Direct Consolidation Loan.  Learn about your consolidation options. Private student loans cannot be consolidated into a Direct Consolidation Loan.  If you are having trouble repaying your loan, you may be able to temporarily postpone or lower your payments. Private student loans may not offer forbearance or deferment options. There are several repayment plans, including an option to tie your monthly payment to your income. You should check with your lender to find out about your repayment options. There is no prepayment penalty fee. You need to make sure there are no prepayment penalty fees. You may be eligible to have some portion of your loans forgiven if you work in public service. Learn about our loan forgiveness programs. It is unlikely that your lender will offer a loan forgiveness program.

Did you know? You can get rid of all debt in bankruptcy EXCEPT student loans. This means you pay these off until you die That private student loans can have interest as high as 19%

Types of Federal Student Loans   Subsidized: for students with demonstrated financial need, as determined by federal regulations. No interest is charged while a student is in school at least half-time, during the grace period, and during deferment periods. Repayment begins following a six-month grace period after you graduate, leave school, or cease being enrolled as at least a half-time student. Unsubsidized: not based on financial need; interest is charged during all periods, even during the time a student is in school and during grace and deferment periods. Repayment begins following a six-month grace period after you graduate, leave school, or cease being enrolled as at least a half-time student.

3 min of Suze Orman http://emutalk.org/2012/08/suze-orman-explains-why-student-loans-are-a-bad-deal/ Please answer #2 on your handout

At 6.8% interest and paying for 10 years your loan increases to… Yikes if it takes you 25 years…

Student Loans http://video.pbs.org/video/1158570286/ As you listen to one woman’s story, reflect on what you are going to do so you are not homeless after taking on student loans Please answer #3-4

Main Messages Think before you borrow because student loan debt is with you until you die Remember that loan companies are out to get your money so ask questions about interest, repayment, and deferment Being smart about money today can help you have a better life Start saving TODAY

First come, first serve so have a New Year’s Eve FAFSA party Juniors FAFSA—opens January 1, 2014. First come, first serve so have a New Year’s Eve FAFSA party Need your parent’s tax info, so ask them for this years info Come up with a PLAN!

Cal Grant Cal Grant A helps low-and middle-income students with tuition / fee costs.  The minimum eligible course length is two academic years. Cal Grant B provides a living allowance for very low-income students.  More than half of all new Cal Grant B recipients begin at a public community college.  The Cal Grant B award for freshmen is usually limited to the nontuition costs of attending college such as living expenses, books and supplies, transportation, etc.  When renewed by sophomores and above, a Cal Grant B may also cover all or part of tuition / fee costs.  There are 250 special Cal Grant B awards authorized for community college students transferring to four-year colleges.  The minimum eligible course length is 12 months. Cal Grant C helps vocational schools students with tuition and training costs.  Recipients must be enrolled in a vocational program at a community or independent college or a vocational school course of study from four to 24 months in length.Graduate Fellowships are open to those who demonstrate their intent to become college or university faculty members.  About 500 awards annually assist with tuition and fees at independent and public colleges and universities.

Activity 1: Create a savings account today and watch it grow http://www.econedlink.org/interactives/index.php?iid=2 Fill in #5 Save for the future: new house, new car, wedding, baby, travel, retirement, and/or possible unemployment Open a savings account today!

Activity 2: Scholarship Research Let’s research free money Apply to 3-5 scholarships. FREE MONEY Fill in #6 http://www.careerinfonet.org/scholarshipsearch/ScholarshipCategory.asp?searchtype=category&nodeid=22

Closing Discussion What did you learn today? What is your plan to pay for college? What questions will you ask if you need to borrow money? What scholarships are you applying for? Don’t need to pay those back!!