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Understanding Obama’s New Student Loan Plan

August 15, 2014

by Suada Kolovic

With the final month of summer rapidly slipping away, now is the time to buckle down and finalize how you're going to fund your college education. Whether that entails a full-ride scholarship (way to go!), an impressive financial aid package or even necessary loans, it's important to understand your options. Some of you might even be considering President Obama's Pay As You Earn Repayment Plan...if you can figure out what it involves or if it's even an option. If you're confused about this plan, you're in luck: U.S. News and World Report has broken down the big questions you need answered below:

  • Will these updates help me? If you have federal student loans, maybe. Starting in 2015, borrowers who took out loans before October 2007 or stopped borrowing by October 2011 will be eligible to take advantage of the Pay As You Earn Repayment Plan. Government officials estimate this includes an additional five million people.
  • How much could I save? Now, most federal loan borrowers are eligible for income-based repayment – a different repayment plan that has the same premise as Pay As You Earn. Unlike Pay As You Earn, however, IBR caps payments at 15 percent of one's disposable income and forgives the balance after 25 years of payments. Those differences could mean a lot, both in monthly payment amount and in the total amount paid over time.
  • Didn't the president mention loan refinancing too? He did, but in relation to a bill that Massachusetts Senator Elizabeth Warren introduced last month called the Bank on Students Emergency Loan Refinancing Act. This legislation would allow federal and private student loan borrowers with older, higher interest loans to consolidate them within the direct loan program at today's lower fixed interest rates. That bill still has to pass both the Senate and the House, something that may not happen because Republicans are opposed to paying for the bill with a gradual increase in tax rates for those in the higher income brackets.
  • What else should I know? There is still a long way to go before the president's executive action takes effect: December 2015 is the target implementation date. The overall plan includes quite a few other ideas that will make a difference to student loan borrowers, like improving financial incentives for federal student loan servicers to help borrowers stay out of default, making it easier for active-duty military to receive benefits and increasing communication partnerships with entities such as the IRS and tax companies to ensure consumers are aware of their higher education rights and benefits.

What do you think of the president's attempt to ease the financial burden associated with student loans? Let us know your thoughts in the comments section. And for more information on federal funding, visit our Financial Aid section.

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Starbucks Offers Employees Free College Tuition

June 16, 2014

by Suada Kolovic

Have you heard the one about the English major that was so unemployable that their only viable option was becoming a barista at the local Starbucks? Well, the joke's on you because starting this fall, Starbucks employees will be eligible for a free college education: According to reports, Starbucks is rolling out a program that would allow its workers to earn online college degrees at Arizona State University at a steeply discounted rate. Thanks a latte!

The new initiative will offer Starbucks' 135,000 U.S. employees who work at least 20 hours a week the option to graduate debt free from ASU with no requirement to repay tuition costs or stay with the company. Under this freshly-brewed program, employees will receive full tuition reimbursement if they enroll in ASU's online program as juniors or seniors; they can also pick from a wide range of educational programs that aren't related to their Starbucks work. And while it’s unclear how many employees with choose to participate in the new program or how much it will cost Starbucks Corp., the company isn't disclosing the financial terms of its agreement with ASU. In a news release, Starbucks CEO Howard Schultz talked about “the fracturing of the American Dream”, saying: “There's no doubt, the inequality within the country has created a situation where many Americans are being left behind. The question for all of us is, should we accept that, or should we try and do something about it?" (For more on this story, click here.)

Do you think this partnership between Starbucks and ASU is a step in the right direction? Would you consider working for Starbucks given the promising initiative? Share your thoughts in the comment section and for more info on how to fund your college education, head over to Scholarships.com.

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College Tuition Increases Slow, Government Aid Falls

October 25, 2013

College Tuition Increases Slow, Government Aid Falls

by Suada Kolovic

High school seniors heading to college in the fall, listen up: The average cost at the nation’s four-year public universities rose 2.9% this year, the smallest annual increase in more than three decades (yay!) but the slowdown in tuition increases have been offset by reductions in federal grant aid (boo!).

According to a new report from the College Board, public colleges have raised tuition prices so sharply in recent years not to gouge students but to bank on the increased state aid. And although the increase is moderate, "this does not mean that college is suddenly more affordable," says economist Sandy Baum, co-author of Trends in Higher Education reports on tuition and financial aid. "It does seem that the [upward tuition] spiral is moderating. Not turning around, not ending, but moderating." Unfortunately, students continue to suffer from the constant cycle of rising costs and serious college debt. Shrinking state aid for public colleges and universities has translated into the cost of public schools to jump $1,770 in inflation-adjusted dollars. The amount of government aid received last year fell $6,646 for every full-time student at those institutions while just five years ago, each student received $9,111 in today’s dollars. (For more on this report, click here.)

If college is in your forecast, what do you make of the report’s findings? Let us know in the comments section.

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Study: Majors Are More Important Than Where You Went to College

September 10, 2013

Study: Majors Are More Important Than Where You Went to College

by Suada Kolovic

With fall semester in full swing, high school seniors are mere months away from deciding where they’ll spend the next four (or more) years. And while there are multiple factors to consider when making such a major decision, most would argue that prestigious universities and high-earning salaries are intrinsically tied...or are they?

According to a recent study by College Measure, students who earn associate degrees and occupational certificates often earn more in their first year out of college than those with traditional four-year college degrees. Examining schools in Arkansas, Colorado, Tennessee, Texas and Virginia, the study found that short-term credentials such as two-year degrees and technical certificates were worth more than bachelor’s degrees in a graduate’s early years. College Measures President Mark Schneider said, “The findings challenge some conventional wisdom, showing for example that what you study matters more than where you study. Higher education is one of the most important investments people make. The right choices can lead to good careers and good wages while the wrong ones can leave graduates with mountains of debt and poor prospects for ever paying off student loans.” (For more on this study, click here.)

It’s important to remember that the study focuses on short-term gains as opposed to long-term/lifelong earnings. It’d be interesting for College Measure to reexamine their findings over the next few years but what do you think of its current report? Share your thoughts with us in the comments section!

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College Students, Grab Those Scanner Guns: College Registries Are Becoming a Thing!

August 1, 2014

by Suada Kolovic

To my understanding, the general rule of thumb for a creating registry is as follows: any event marking a significant life change (marriage, baby, new home, etc.) warrants one. And while no one would argue that heading off to college would fit that description, only recently have college-bound students been encouraged to register for items that would smooth their transitions to college life.

Once reserved for brides and moms-to-be, big box retailers are opening up their gift registries to college students. Target rolled out a college registry in June and already thousands have signed up. "Our college-bound guests were looking for an easy way to manage lists and share them with friends and family online," said Jenna Reck, public relations manager for Target. "When we looked at the registry experience we already offered through the Target Wedding and Target Baby registries, we quickly realized that it was the right solution." The registry will be accessible year-round and is geared toward students in every stage of their campus lives. Other retailers including Bed Bath and Beyond, The Container Store and Walmart also have registries that cater to college students. (For more on this story, click here.)

What are your thoughts on college registries? Do you think they’re practical or tacky? Share your thoughts in the comments section. For more information on preparing for college and what to expect once you get there, look over our College Prep section.

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11 Colleges Where You Can Earn a Degree for Free

July 29, 2014

by Suada Kolovic

Here at Scholarships.com, we make a point to advocate the importance of funding your college education the right way (for free!) and while financing your higher education solely with scholarships is an amazing feat, there is another factor to consider: colleges with no tuition to be begin with. Yup, they totally exist – check out the 11 colleges below where you can earn a degree for free:

We should also mention that elite universities with healthy endowments also tout financial aid programs that pay 100 percent of tuition, room and board and fees for students from families with certain incomes – $75,000 or less at MIT, $65,000 or less at Harvard and Yale, and $60,000 of less at Columbia, Cornell, Stanford, Duke, Brown and Texas A&M. For a more detailed look at any of the schools listed or hundreds of other universities, check out our College Search. And let us know where you’re heading this fall in the comments section!

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Attention Students: 4 Warning Signs You’re Headed for Student Loan Default

September 3, 2014

by Suada Kolovic

With September officially upon us, millions of students across the country are heading back to college. With all the fun and excitement that goes into the fall semester, however, some may not have ironed out one major detail: how they're going to pay for it. For most college students – even those with impressive financial aid packages – loans are a necessary piece in their financial aid puzzle. And with college graduation and loan repayments coming up faster than you think, it's important to understand the warning signs that you may be headed toward defaulting on your student loans. Check out U.S. News and World Report's four warnings to heed below:

  1. You don’t know when your first payment is due: If you borrowed student loans, you are responsible for knowing when your payments begin, how much they are and where to send them...even if you don’t receive any notices with these details.
  2. You dropped some classes or dropped out of school: One common reason why some borrowers don’t know when their first payment is due is that they didn’t realize their repayment grace period was already winding down. For federal student loans, the grace period kicks in when students drop below half-time enrollment. Keep in mind that half-time enrollment is defined differently from school to school. And if you've left school altogether, you are still required to repay any loans you borrowed.
  3. You can’t afford your payments: The student loan grace period gives borrowers some time to figure things out before repayment begins...but you may still be looking for work or barely able to cover your living expenses (let alone expensive loan payments) after that period expires. If you borrowed federal student loans, you may be able to select a payment plan that decreases the amount you pay each month, perhaps based on how much money you make.
  4. You think you already defaulted: Borrowers often confuse delinquency and default. If you miss a few payments, your loan is likely delinquent and you can still do things to avoid the consequences. If you have defaulted, don’t give up! You can pull your loan into good standing by paying it in full, consolidating it or through rehabilitation.

For more tips on repaying your student loans and borrowing responsibly, head over to our Financial Aid section. And don’t forget to try and fund your education with as much free money as possible – a great place to start is by creating a free profile on Scholarships.com!

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On the Hunt for Merit Aid? Apply Here!

September 16, 2014

by Suada Kolovic

Here at Scholarships.com, we stress the importance of paying for your college education the best way we know how: with free money in the form of scholarships! And while scholarships might not fully cover your tuition and expenses, college applicants who aren't deemed financially needy in terms of their FAFSA should consider the importance of merit aid. It can make a huge difference in the schools they can realistically afford and students and families seeking this extra financial aid boost should consider researching schools more likely to dispense merit-based awards.

But with so many colleges and universities across the country, which ones are the best financial bets? Help has arrived in the form of U.S. News & World Report, which has compiled a list of the schools that awarded the highest percentage of merit-based funding to non-needy students during the 2013-14 academic year. (The stats do not include financially needy students who were given merit aid or students who received athletic scholarships or other tuition breaks.) Take a look:

High school students, does this data have you looking at these schools in a new light? Current college students attending one of the schools listed above, did merit aid make the difference as to whether or not you enrolled? Share your thoughts in the comments section. And as always, don’t forget to create a free Scholarships.com profile to get a personalized list of scholarship opportunities!

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Is Earning a College Degree Worth It? Study Finds Modest Return for Some

February 10, 2015

by Suada Kolovic

It wasn't too long ago that the majority of Americans agreed that one had to pursue a college degree in order to succeed in the workforce. Unfortunately for millennials, the rate of success after obtaining said degree is no longer so intrinsically tied: According to reports, millions of college students don't graduate, suffer a mismatch between education and employment and are left with massive amounts of debt.

New research suggests that earning a college degree is no longer the surest ticket to the middle class. "'Ticket' implies a college degree is something you can just cash in," said Alan Benson, assistant business professor at the University of Minnesota. "But it doesn’t work that way. A college degree is more of a stepping stone, one ingredient to consider when you’re cooking up your career...It’s not always the best investment for everyone." Benson, along with MIT’s Frank Levy and business analyst Raimudo Esteva, co-authored a new paper examining the value of public university options in California. They found that factors like how long it takes to complete a degree and whether students even make it to graduation can significantly diminish the value of pursuing higher education. Unsurprisingly, the study also found that students who take out loans and don’t graduate on time incur much more debt. All in all, Benson concluded that the investment of a college education is generally better for those who graduate – on time – from a school with healthier resources. (For more on their research, click here.)

Do you think that a college degree is necessary for gainful employment and upward mobility? Share your thoughts in the comments section. And don’t forget to try and fund your education with as much free money as possible – a great place to start is by visiting Scholarships.com and conducting a free college scholarship search where you'll get match with scholarships, grants and other financial aid opportunities that are unique to you!

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A New Facebook in Town?

August 31, 2010

by Kevin Ladd

Looks like there’s a new facebook in town. Sort of. Apparently trying to recapture what the aforementioned site once offered, namely exclusivity to college students, is the new site CollegeOnly.com. It’s really not a bad idea, either, if you think about it. Sure, facebook really took off and their numbers skyrocketed as a result of their opening-up their site and services to the general public, but at what price? Or, at what price to students, I should say. It worked out pretty well for facebook. I mean, does it really make sense to jettison users of your site once they reach a particular age or social status? With regard to site traffic, less is never more.

Several years ago, students could go online and post photos from frat parties and, basically, be college students without fear of their parents, employers, etc. seeing them, for example. Sure, facebook allows you to adjust your privacy settings and sure, you don’t have to accept every friend request you get, but it could be a bit awkward to get an invite from an employer, parent, aunt, etc. with whom you really don’t want to be facebook “friends” for the above-mentioned reasons.

Having only glanced at the site (don’t currently have a “.edu” email address), I can’t go into much more detail, other than to say the clipart on the home page is certainly an interesting choice. Regardless of your gender or preference there’s a plunging neckline there for you. Enjoy.

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