2008 Woodie Awards
Managing money, from loans to credit
Beth Kramer
Issue date: 9/13/07 Section: Entertainment
- Page 1 of 1
Between scholarships and federal loans, Anne Marie Palazzolo has tuition and textbooks completely paid for. But the junior special education major still has to pay for rent, food, car insurance and gas.
To accommodate, she employs a number of money-saving strategies. Friends have dubbed her "the coupon queen" because she clips countless coupons.
"I look for sales and coupons and don't spend money on unnecessary things if I don't have to," Palazzolo said.
When she can't afford something, like a winter jacket or even dental work, she asks her family to buy it for her in the form of a birthday or Christmas gift. She surfs clearance racks and second-hand stores to keep costs down.
"I don't really spend much on fun stuff. I make enough to cover the bills and a little extra.
"My expenses are pretty low for entertainment: renting movies, making nice dinners and going for walks," Palazzolo said.
Despite her thrifty spending habits, she still finds herself coming up short.
A Look at Loans
Scott Thum, assistant director of financial aid, said the first place to look for additional money is at NMU. Check federal eligibility for a FAFSA (Federal Application For Student Aid). Students' financial need is determined by subtracting the expected family contribution (taken from parents' paychecks) from the cost of tuition.
"That's the single biggest thing you can do," Thum said. "Regardless of parental income, regardless of how much money you make, if you're eligible to file a FAFSA form, there will be some money there for you. Worst case scenario, it's just loans at a fixed 6.8 percent interest rate, which nine times out of 10 beats what you'll find outside the school."
It's important to look at how money much is needed as opposed to how much is desired, Thum said. The needs can accumulate quickly, like they did for Palazzolo. Beth Guerard, spokesperson for SallieMae, a national provider of student loans and college savings plans administrator, suggests conducting an "honest self-assessment of spending" by looking through bank statements to see exactly where the money is going. This includes examining spending habits for entertainment, such as movies or concerts, sporting events, late night pizzas, parking and gas.
"It's certainly the right time of year to think about budgeting," Guerard said.
A preliminary budget can be gauged by seeing if income (from loans, scholarships, jobs or elsewhere) is enough to cover these expenses. If the numbers don't add up, it's time to consider a private loan, both Thum and Guerard said.
"It's cliché, but you want to read all the small print, you want to weigh your options even before you do a credit check," Thum said.
Shop around for private loans to get the lowest APR (annual percentage rate) possible, Thum advised. Look out for application or origination fees. An origination fee requires the borrower to pay a percentage up front. For example, if a loan has 3 percent origination and $100 was borrowed, then $3 would be paid before the student would receive any money.
Control Credit
"Be very cautious about credit cards. Not every student needs a credit card," Guerard said. "Granted, they're handy but be careful of making nonessential purchases."
The SallieMae Web site (www.salliemae.com) broke down a credit card payment with an 18.5 percent APR. If a student puts a $2,000 tuition payment on a credit card with this APR rate and only pays the minimum balance due each month, it will take 11 years to pay the bill and the student will accrue almost $1,200 in interest.
Thum suggests that students shop around various credit card companies to find the lowest APR. He recommends getting the percentage ranges before applying for a credit card. To fix the exact APR, credit card companies run a credit check, which is determined by scrutinizing a student's financial history. This includes calculating the amount of debt compared to income as well as checking to see that bills are paid on time.
Credit cards are generally not a good option. Use loans, not credit cards. This should help keep you out of financial trouble, he said.
"Your main purpose is to learn," Thum reminds students. "There is a college experience and that is awesome. It's a wonderful thing you want to take advantage of, but if there's too much excess when you're experiencing it, it's going to make your life hard down the road. You're married and you have kids, and you have your student loans and you're looking at them year after year wondering when do I get out of it? [You] ate the nicer Ramen noodles but you don't have anything to show for it at the end."
The SallieMae Web site says to remember that credit cards are a convenience, not a source of spending money. Bearing this in mind should keep students in good financial shape.
"Eliminating your debt is kind of like saving sometimes. You're saving yourself [from] accruing debt, more and more debt every year," Thum said.
Spots Students Save
-Applebee's Bar and Grill offers half-price appetizers 8 p.m. to 11 p.m. Sunday through Thursday and half-off draft beer. They are located at 2902 U.S. 41.
-Aubree's Pizza gives all NMU students a 10 percent discount when they dine in and delivers free to the residence halls. They are located at 227 W. Washington St.
-Super One Foods prints a coupon book every Sunday that is valid all week. Copies can be found in "The Mining Journal" or within the store at 3070 W. U.S. 41.
-Econo Foods has an everything-for-$1 aisle. In addition, they offer a More card, which provides sale prices for certain items in the store. Econo can be found at 1401 O'Dovero Dr.
-Fazoli's offers an all-you-can-eat pizza and pasta bar for $4.99 daily. Just ask for the student special. Fazoli's can be found at 2323 U.S. 41.
-Hardee's gives every NMU student with an ID a free drink and fry with any Thickburger. They have two locations: 1422 Presque Isle Ave. and 1120 W. Washington St.
-Hudson's Classic Grill and Restaurant offers half-price appetizers from 1 p.m. to 4 p.m. and 8 p.m. to midnight daily. They are located at 2433 U.S. 41.
-Los Tres Amigos offers three specials from 4 p.m. to 7 p.m. Mondays and Tuesdays: half-price margaritas and mixed drinks, appetizers are also half-off and draft beer costs $1. Los Tres Amigos is located at 3515 U.S. 41.
-The Pasta Shop, located at 824 N. Third St., gives every NMU student with an ID $2 off any order on Sundays.
-Togos gives NMU students a free medium pop with an ID. They are located at 1000 N. Third St.
To accommodate, she employs a number of money-saving strategies. Friends have dubbed her "the coupon queen" because she clips countless coupons.
"I look for sales and coupons and don't spend money on unnecessary things if I don't have to," Palazzolo said.
When she can't afford something, like a winter jacket or even dental work, she asks her family to buy it for her in the form of a birthday or Christmas gift. She surfs clearance racks and second-hand stores to keep costs down.
"I don't really spend much on fun stuff. I make enough to cover the bills and a little extra.
"My expenses are pretty low for entertainment: renting movies, making nice dinners and going for walks," Palazzolo said.
Despite her thrifty spending habits, she still finds herself coming up short.
A Look at Loans
Scott Thum, assistant director of financial aid, said the first place to look for additional money is at NMU. Check federal eligibility for a FAFSA (Federal Application For Student Aid). Students' financial need is determined by subtracting the expected family contribution (taken from parents' paychecks) from the cost of tuition.
"That's the single biggest thing you can do," Thum said. "Regardless of parental income, regardless of how much money you make, if you're eligible to file a FAFSA form, there will be some money there for you. Worst case scenario, it's just loans at a fixed 6.8 percent interest rate, which nine times out of 10 beats what you'll find outside the school."
It's important to look at how money much is needed as opposed to how much is desired, Thum said. The needs can accumulate quickly, like they did for Palazzolo. Beth Guerard, spokesperson for SallieMae, a national provider of student loans and college savings plans administrator, suggests conducting an "honest self-assessment of spending" by looking through bank statements to see exactly where the money is going. This includes examining spending habits for entertainment, such as movies or concerts, sporting events, late night pizzas, parking and gas.
"It's certainly the right time of year to think about budgeting," Guerard said.
A preliminary budget can be gauged by seeing if income (from loans, scholarships, jobs or elsewhere) is enough to cover these expenses. If the numbers don't add up, it's time to consider a private loan, both Thum and Guerard said.
"It's cliché, but you want to read all the small print, you want to weigh your options even before you do a credit check," Thum said.
Shop around for private loans to get the lowest APR (annual percentage rate) possible, Thum advised. Look out for application or origination fees. An origination fee requires the borrower to pay a percentage up front. For example, if a loan has 3 percent origination and $100 was borrowed, then $3 would be paid before the student would receive any money.
Control Credit
"Be very cautious about credit cards. Not every student needs a credit card," Guerard said. "Granted, they're handy but be careful of making nonessential purchases."
The SallieMae Web site (www.salliemae.com) broke down a credit card payment with an 18.5 percent APR. If a student puts a $2,000 tuition payment on a credit card with this APR rate and only pays the minimum balance due each month, it will take 11 years to pay the bill and the student will accrue almost $1,200 in interest.
Thum suggests that students shop around various credit card companies to find the lowest APR. He recommends getting the percentage ranges before applying for a credit card. To fix the exact APR, credit card companies run a credit check, which is determined by scrutinizing a student's financial history. This includes calculating the amount of debt compared to income as well as checking to see that bills are paid on time.
Credit cards are generally not a good option. Use loans, not credit cards. This should help keep you out of financial trouble, he said.
"Your main purpose is to learn," Thum reminds students. "There is a college experience and that is awesome. It's a wonderful thing you want to take advantage of, but if there's too much excess when you're experiencing it, it's going to make your life hard down the road. You're married and you have kids, and you have your student loans and you're looking at them year after year wondering when do I get out of it? [You] ate the nicer Ramen noodles but you don't have anything to show for it at the end."
The SallieMae Web site says to remember that credit cards are a convenience, not a source of spending money. Bearing this in mind should keep students in good financial shape.
"Eliminating your debt is kind of like saving sometimes. You're saving yourself [from] accruing debt, more and more debt every year," Thum said.
Spots Students Save
-Applebee's Bar and Grill offers half-price appetizers 8 p.m. to 11 p.m. Sunday through Thursday and half-off draft beer. They are located at 2902 U.S. 41.
-Aubree's Pizza gives all NMU students a 10 percent discount when they dine in and delivers free to the residence halls. They are located at 227 W. Washington St.
-Super One Foods prints a coupon book every Sunday that is valid all week. Copies can be found in "The Mining Journal" or within the store at 3070 W. U.S. 41.
-Econo Foods has an everything-for-$1 aisle. In addition, they offer a More card, which provides sale prices for certain items in the store. Econo can be found at 1401 O'Dovero Dr.
-Fazoli's offers an all-you-can-eat pizza and pasta bar for $4.99 daily. Just ask for the student special. Fazoli's can be found at 2323 U.S. 41.
-Hardee's gives every NMU student with an ID a free drink and fry with any Thickburger. They have two locations: 1422 Presque Isle Ave. and 1120 W. Washington St.
-Hudson's Classic Grill and Restaurant offers half-price appetizers from 1 p.m. to 4 p.m. and 8 p.m. to midnight daily. They are located at 2433 U.S. 41.
-Los Tres Amigos offers three specials from 4 p.m. to 7 p.m. Mondays and Tuesdays: half-price margaritas and mixed drinks, appetizers are also half-off and draft beer costs $1. Los Tres Amigos is located at 3515 U.S. 41.
-The Pasta Shop, located at 824 N. Third St., gives every NMU student with an ID $2 off any order on Sundays.
-Togos gives NMU students a free medium pop with an ID. They are located at 1000 N. Third St.
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