Online College: Rights and Wrongs

iStock_000003865535SmallIt seems like just about everything is being made into a mobile activity these days: watching movies, executing financial transactions, even getting a college degree. With that last one really gaining momentum, you might be wondering if going to college online is the best option for you. Before making a decision on this potentially life-altering matter, it’s wise to think about how the alternative of taking courses online fits with your goals, traits and circumstances.

 

Getting a degree online might be right for you if:

  • You’re looking to save money on transportation, housing, textbooks or other campus-related expenses
  • You want to work full- or part-time while taking classes
  • You’re looking for career-building education that won’t interfere with your current working situation
  • You’re looking for an inexpensive way to “dip your toes in the water” of the college experience
  • You want to take classes while caring for family members
  • You want to finish your degree more quickly by taking more courses (no scheduling conflicts exist with online courses)
  • You have a disability or other characteristic that makes it difficult to attend classes in-person
  • You want to pay less for tuition (in some cases)

 

Getting a degree online might be wrong for you if:

  • You struggle to create structure or motivation for yourself
  • You are looking for the networking opportunities brick and mortar campuses can provide
  • You find that you thrive academically in a face-to-face dynamic
  • You want to be able to regularly ask your professors questions directly
  • You are in a location where internet access is spotty
  • You are afraid that your financial aid won’t cover all your classes (in some cases)

With all the flexibility offered by online learning these days, your best way to approach your college education is probably to determine all your goals for the next 2-4 years and then build your education around that.

8 Steps for Avoiding Military-Targeting Scams

177005416If you’ve been in the military for long, you’ve surely encountered them: the financial vultures who circle around bases, looking to take advantage of members of the armed forces. It seems they will use just about any means necessary to separate you from your hard-earned money. However, by learning how to identify these predators in the field, you can steer clear of their deceptive and damaging offers.

Commit to saving
No matter what your line of work, there are always going to be times when life throws you a curve. Vehicles break down, family members need help, and household items need replacing. You can’t always predict when these things will happen, but you can be prepared for when they inevitably do. By regularly contributing to a savings account – even with a small amount per month – you can deal with life’s unexpected costs without having to resort to risky or expensive financial products.

Plan ahead
If you leave financial decisions to the last few days or hours before you are sent across the country or across the world, you risk putting yourself in a desperate situation. In most cases, this is going to lead you to financial products or offers that aren’t in your best interest. If you haven’t done so already, develop a plan for what you will need to resolve before you are called off to a new address.

Check credentials
As crazy and crass as it sounds, there are hundreds of people out there looking to target military personnel for financial schemes that are questionable at best and disastrous at worst. Ask the community service officer on base to help you verify which organizations or individuals offering help are actually affiliated with the armed forces. It’s also not a bad idea to check out information from the Better Business Bureau at www.bbb.org. They even have a military-specific section at www.bbb.org/military.

Avoid products with up-front fees
A favorite ploy of scammers who target men and women in uniform is to offer financial services or loans only after an advance fee is paid. In most cases, these fly-by-night operators just take your money and you never hear from them again. Your best option is to work with reputable community banks or credit unions for your financial needs.

Address your credit
Another smart step for avoiding rash decisions is to maintain your credit scores and reports in a way that makes you likely to qualify for a loan, should you need one. The rates you’ll get for a personal loan from a credit union or community bank are likely to be MUCH better than what you would get from less reputable lending establishments. In some situations you may qualify for an emergency loan from the government, but your best bet is to always have the option to qualify for a loan on your own.

Think carefully about extra insurance
There are unscrupulous agents out there who will try to convince you that your government-provided insurance isn’t enough to protect yourself or your family. However, the wise move is to max out the coverage plans you already have first before looking to get any extra policies.

Be wary of “adjustable” terms
A favorite trick of sketchy agents or dealers is to sign you up for a contract with a promise that you’ll be switched to better terms at a future point. The pitch usually goes something like: “Because of our rules, we have to keep these terms on the contract for now, but I can get you a better deal after you sign up because you’re in the military.” Bottom line: Unless it’s in the contract, the person making the deal with you has no obligation to live up to their word. Always get offers in writing first.

Get a second opinion
You’re never alone in the financial world. There are always resources you can turn to for help. If something sounds fishy, asking a certified financial counselor for help can get you the guidance you need to make the best choice for your money.

Military officials and the federal government have been cracking down on unsavory financial practices that target servicemen and women. But keep in mind that you can do your part too. If you encounter anyone making offers that resemble any of the above-mentioned scams, report them to your base’s Armed Forces Disciplinary Control Board.

Discharging Student Loans Through Bankruptcy

488960049Student debt is weighing on you like a baby grand piano on your back. You honestly have no idea how you can make payments. You’re considering throwing up your hands and declaring bankruptcy to rid yourself of the unworkable debt. But not so fast. There are a few things you need to know before you go down this path.

Who can have loans discharged?
In order to have your student loans discharged, you must show that paying them would cause an “undue hardship” for you and/or your dependents. Generally speaking, in practice this is a very tough standard to reach.

How is hardship determined?
Each court can determine what standard they use to determine undue hardship. A common measurement is known as the Brunner test. Under this test, you are allowed to discharge your student loans only if:

  • You cannot maintain a minimum standard of living for yourself or your family because of a very low income
  • Your current financial hardship is likely to endure for the life of the loan
  • You have made a concerted effort to repay your loans

Other tests bring different factors into the equation, but in general the recurring themes are a very low income and a financial situation that will probably remain difficult.

How do I know if I can discharge?
Given the varying methods for handling these types of cases, your best bet is to consult with a bankruptcy attorney in your area who has experience dealing with student loan issues. If you’re worried about the cost of using the services of an attorney, research organizations that provide free or low cost help in your area, such as Legal Aid.

If you feel like the above hardship criteria apply to your situation and you don’t foresee being able to pay back your loans, you should definitely get in touch with an attorney. Just know that you’ll need to show evidence of your difficult situation and that the going may be tough.

Regular vs. Student Credit Card

iStock_000000080595MediumIf you’re a college student, a credit card can be a great way to learn the ins and outs of using credit wisely while also building a nice credit rating. But it’s important to keep in mind that just because your card has the same logo as mom’s or dad’s, that doesn’t mean all the terms are the same.

While credit card companies are willing to offer you a credit card, they still see your student status as a risk. You likely have a small income – if any – and scant experience using credit. Because of these factors, the issuer of your student credit card is probably going to make a few tweaks to the terms for your card. These often include:

  • Larger annual fees
  • Higher interest rate for charges made to the card
  • Lower credit limit
  • Scaled-down cash-back offers, reward points or other benefits
  • Requirement of a co-signer

If you’re going to use a student credit card – or any credit card for that matter – you need to have a plan in place for how you’re going to use it. If you’re like most college students, your best course of action is to have one regular, fairly small expense that you pay with the card. An example would be a monthly trip to the grocery store.

It’s also vital to know all the particulars of a credit card before you fill out any paperwork or pixelwork. High interest rates or low limits aren’t necessarily deal breakers if you are planning on using the card judiciously and paying it off each month. The annual fee, though, is something generally worth paying attention to since it is a cost you will definitely have to pay.

Many websites allow you to compare various student credit cards, so use their side-by-side charts to identify cards with low fees and other favorable terms. Also be sure to contact your local credit union or community bank to see what they offer. Avoid signing up for a card on-the-spot because you get a free gift or the sales pitch sounds enticing.

Assuming that your plan isn’t to be a student forever, it’s also wise to ask what happens to the card when you are out of school. If you’ve used the card in a responsible way, will the limit be raised and the interest rate dropped? Will you have to open a new account to get better terms? Knowing this before you open the card can make the decision easier.

As long as you know what you are getting into, a student credit card can be a wonderful tool for preparing you for financial life outside of academia. Study up on the important factors and never be afraid to get help for the confusing parts.

Homeowners Insurance Discounts Checklist

iStock_000007589790SmallDoes looking at the rates for your homeowners policy make you long for the days of renting…or even living under someone else’s roof? If so, don’t throw in the towel just yet. There are ways to save on homeowners insurance that you may not have even thought of yet. As an added bonus, some of them involve steps you may have already taken to improve or protect your house. Be sure to ask your insurance provider about discounts for:

  • Smoke alarms
  • Sprinklers
  • Fire extinguishers
  • Security cameras
  • Alarm systems
  • Deadbolt locks
  • New electrical writing
  • New furnace
  • New foundation
  • New pipes
  • Roof repair or replacement
  • Lack of claims in the past
  • Membership in a Homeowner’s Association (HOA)
  • Not smoking
  • Gas sensors
  • Moisture sensors
  • Handrails next to your stairs
  • Bundling insurance policies
  • Getting a policy through an employer, professional association or alumni group
  • Being above 55 and/or retired
  • Living in a gated community
  • Renovating your home
  • Making your home more earthquake resistant (in certain areas)

If you’ve maxed out your savings from each of these measures, consider raising the deductible on your policy. This can in turn lower your premium. However, make sure you will be able to afford the higher deductible in case a claim is needed.

In general it’s a good idea to stay in contact with your insurance provider. First, you may learn about improvements to your home that basically pay for themselves. Second, by calling your provider at least once every six months, you can stay on top of any of the latest breaks being offered.

As with most policies or plans, if you periodically do some digging you can find some savings. If you’re currently paying for homeowners insurance, making a commitment to learning about savings and staying in touch with your provider can save you thousands over the life of your policy.

How to Rent Like You’re Going to Own

473009317If you’re currently renting an apartment but would like to own a home someday, you’ve probably started to think about what it will take to get the keys to that house. As a renter, you should know that there are a number of ways you can use your time paying for your lessor’s mortgage as a springboard toward getting your own.

Live below your square footage means
Bottom line: splurging on a big apartment with all the extras can feel satisfying, but it can also take money away from your home-buying goal if it comes with a bigger price tag. Consider downsizing your current living situation to get into a house more quickly.

Don’t accumulate aggressively
If you’re earning a comfortable income, you may also be experiencing a desire to feather your nest a bit. Not only will a larger pile of possessions cost more to move into a home, but it can also lead you to buy more house than you need just to fit it all in. Getting in the habit of creating a comfortable and pleasant home without a lot of clutter will help you save and also make for a thriftier transition.

Goal reminders
Your apartment doesn’t have to be just the place where you store your stuff and sleep at night. It can also serve as a way to keep you focused on your home-purchasing goal. Keep pictures of the type of home you are interested in taped to your laptop or fridge. Keep a saving chart displayed prominently inside a cabinet or your wallet. By having these reminders around, you can maintain your focus even when saving isn’t at the forefront of your mind.

Get utilities smart
Consider renting as a trial run for mastering the delicate art of efficient use of utilities. By brainstorming ways to save on water, electricity, heat, etc., you establish positive habits that will serve you well when you make the big move into a home of your own.

Be lease careful
In your drive to improve your credit, don’t forget about the potential impact to your credit of breaking a lease. Like individual rent payments, breaking a lease isn’t going to show up on credit reports in most cases. However, if the person or company leasing you the apartment takes legal action against you to recover the deficiency amount you owed on the rental agreement, this could result in an ugly judgment showing up on and damaging your credit reports.

Pay your mortgage now
If you haven’t done so already, now is the time to sit down with pencil and paper – or laptop and spreadsheet – to figure out what you can truly afford for a future mortgage payment. While there are different ways to arrive at this number, a rough estimate in many cases is to figure that your mortgage payment should be no more than 35% of your monthly pre-tax income. If this 35% figure is more than your current rent payments, make a commitment to start depositing the difference into a savings account each month. This way, you train yourself to adjust to this new monthly obligation while also beefing up your down payment, closing fee or maintenance fund.

Renting an apartment doesn’t have to feel like serving out a sentence while waiting to get to the home you really want. Instead, think of it as a way to prepare yourself for dominating the process of getting into that home.

How to Keep RFID Credit Cards Safe

iStock_000000080595MediumMany technologies have emerged in the past few years to make your financial life easier. However, these new tools have also created the potential for criminals to find new ways into your sensitive data. RFID credit cards are a chief example of this new dynamic.

What are they?
RFID stands for radio frequency identification. Like a smart phone, these smart cards allow for transactions to take place without the card being swiped in a card reader. The technology is intended to make paying for goods and services as simple as possible. It is often marketed as way to pay by “tapping” or “waving” your card.

How do I know if I have one?
To figure out if your credit card has RFID, you can:

  1. Look on the card for the logo or name of a company providing RFID services. Common names are PayWave, PayPass, ExpressPay and Zip.
  2. When in doubt, call the issuer of the credit card and simply ask.

What is the risk?
Thieves have taken advantage of scanning devices that can allow them to intercept the information from your card while they are in close proximity to you. This allows them to quickly process a payment from your card to an account they control.

What steps can I take to protect my information?
You can:

  • Not get an RFID card if you are concerned about the risk
  • Buy a special protective wallet, sleeve or card case
  • Make a homemade protective shield out of tin foil or Tyvek
  • Monitor your account information for suspicious activity

There isn’t any evidence currently of widespread data theft through RFID technology. But if you decide to go with an RFID card, you should only do so after implementing a plan for protecting your information. If you are concerned about the potential risk, you may be better off opting for a card without RFID capability.

7 Tax Factors That Could Increase Your Audit Odds

8663948The IRS has taken steps to project a kinder, more understanding image in the past few years, but that doesn’t mean getting an audit from them is going to be lollipops and rainbows. You’re still much better off avoiding the pitfalls that can lead to a closer look from the IRS.

Failing to report income
You aren’t the only one getting copies of your 1099s and W-2s. The IRS gets these too, so if you want to avoid a sit-down with an auditor, you’ll do well to include all forms of income you’ve earned.

Higher than normal deductions
The IRS calculates average expected deductions for different levels of income. If the amount you are deducting doesn’t fit with how much money you have coming in, this could raise a red flag. This shouldn’t dissuade you from taking the deductions you are due; just know that you may be asked to provide further documentation.

Improper home office deduction
Keep in mind that there is a somewhat complicated list of qualifications you have to meet in order to take home office deductions. Be careful to review the IRS verbiage in this area carefully and/or consult with a tax professional.

Unreported investment income
Remember when we talked about the IRS getting your work income records? They also get your investment data, so don’t fudge the numbers in this row either.

Unfinished return
To the IRS, an incomplete return can look like a sign of general sloppiness in tax preparation. Missing information in one area can make them start wondering what else you forgot.

Hobby losses
A popular tactic for some taxpayers in the recent past was to write off expenses from a hobby as business losses. The thinking was that this practice could be justified by claiming that the pastime was a money-making venture that simply failed to get off the ground. However, the IRS has taken measures to try to ferret out this kind of practice. If you are going to write off a side-gig as a business loss, make sure you meet the standards for doing so.

Excessive Schedule C deductions
Schedule C is a terrific way for the self-employed to deduct expenses relating to running their business. Don’t go overboard, though. You are required to keep documentation for these types of deductions, so don’t try to “slip by” any questionable items.

Studies have shown that less than 1% of taxpayers in the United States get audited. To put yourself on the happy side of that number, your best bets are always to err on the side of caution, keep detailed documentation and work closely with a tax professional.

The Money Buddy System

iStock_000000479959LargeLike losing weight or quitting a smoking habit, improving your money choices can be easier when you have someone who is going through the same thing. If you are trying to stay on the right path but find yourself veering off, you may find it easier to stick to your plan if you have someone to gently nudge you in the right direction from time to time. Like any partnership it takes the right approach and the right techniques.

Find someone with a similar situation
If your neighbor has 5-digits in his monthly pay and you are in the low 4-digits, the resulting difference in goals and spending/savings habits is likely to make him not the best buddy for you. While you don’t have to ask for a copy of a prospective buddy’s latest tax return, try to gauge whether or not you are in a similar financial circumstance.

Be a good listener
What you get out of the buddy system will depend in large part on what you put into it. Make yourself available to hear out your buddy when a problem arises. Also, don’t be afraid to share your own experiences. In most cases, you’ll find that your buddy has been through something similar.

Talk about goals
Share your short-, medium-, and long-term financial goals with your buddy. It will be a lot easier for your buddy to help you stay motivated if they know what you are saving for and can bring that up at crucial times.

Share budgets 
It can be intimidating to have another person examine your personal financial details, but by allowing your buddy to look over your spending and savings plan, you open up more possibilities for finding better ways to maximize your money. Your buddy may have tips for saving money that you never even thought of.

Shop together
Ordinarily, financial experts recommend shopping alone as a way to save money. However, if you could use that good angel on your shoulder at critical times, schedule your shopping with your trusted buddy. Review your proposed purchases together before checking out. Don’t be afraid to accept constructive criticism.

Be firm
If you feel your buddy has made or is about to make a bad choice, don’t hesitate to say so. It’s smart to be tactful, but if you are too bashful about offering advice, you run the risk of becoming an enabler of bad decisions.

Find alternatives
One of your best strategies for avoiding retail therapy is to find free alternatives that you enjoy with your buddy. Whether it’s going for a walk, having a nice conversation, or playing a game of cards, identify activities that you both enjoy and can use to blow off a little steam.

Share tips
A good money buddy contributes to the collective betterment on a regular basis. Share articles, blog posts, or other helpful information you find. By fostering a sense of togetherness, you can bring strength to your partnership.

Money is a big topic with a lot of complexity and emotion involved. You should never have to feel like you are tackling your financial situation alone. If you could use a helping hand, don’t be afraid to reach out.

Filing an Internet Crime Complaint with IC3

93087206One of the most frustrating things about encountering criminal activity on the internet is that it is very tough to find out who is perpetrating it. For example, an email meant to trick you into giving up your sensitive information doesn’t give you any real clues into who actually sent it. While you may not have the ability or the resources to track down the people behind online scams, there is a way for you to pass along information to people who do.

The Internet Crime Complaint Center (IC3) is the result of a partnership between the FBI and the National White Collar Crime Center. Its purpose is to:

  • Research complaints
  • Develop the complaints into information useful for investigations
  • Forward that information to the appropriate law enforcement or regulatory agencies

While IC3 doesn’t intervene in individual matters, they do aim to make the internet safer for everyone by detecting patterns of criminal activity.

If you suspect you have witnessed or been a victim of criminal activity on a website or via email, you can file a complaint at: www.ic3.gov/complaint

Per the IC3 website, you should be prepared to include the following in your complaint:

  • Your name
  • Your mailing address
  • Your telephone number
  • Name of the individual or business that defrauded you
  • Address of the individual or business that defrauded you
  • Telephone number of the individual or business that defrauded you
  • Website and email address of the individual or business that defrauded you
  • Specific details on how you were defrauded
  • Any other relevant information necessary to support your complaint

It’s important to remember that filing a complaint with IC3 doesn’t take the place of contacting law enforcement to file a police report.

While registering a complaint with the IC3 might not rectify your current situation, it can certainly make the internet experience safer for you and everyone else in the future.