A house bill that would boost Pell Grants and kill subsidized student loans has gained widespread support and will go next to the Senate, where its fate is still uncertain. Supporters say it would save an estimated $87 billion, although critics have disputed that figure.

Republicans disagree with putting the government in near-total control of student lending, and many worry about the job losses that would inevitably stem from cutting private lenders. More than 30,000 jobs rely on the subsidized loan program, and many positions would be eliminated. The biggest student lender, Sallie Mae who currently employs 8,500, said it would have to cut about 30% of its workers if the subsidized loan program is cut.

If the bill is passed, college students would not see much of a difference in their loans, which they would get from their schools. However, the measure would keep interest rates for some federal loans, based on need, from jumping to the scheduled 6.8% in 2012.

http://finance.yahoo.com/news/House-bill-would-kill-apf-2938854770.html?x=0

Kevin Waldron, from Merrill Lynch fills us in on common financial mistakes that college students make and some great advice for parents on how to proactively help their children avoid making these mistakes.

Mistake #1: Credit Card Debt. College students are inundated with credit card applications and without proper guidance credit cards can throw your college student into debt extremely fast. The average college freshman carries over $1,500 worth of credit card debt and by graduation that amount has nearly doubled.

Advice: Choose the right card and advise use for your student.

Mistake #2: Using a bank account from home. When college students go away for the first time, they have their own bank accounts and ATM cards from home. This leads to problems when students are taking money out of ATMs and being charged fees of up to $2.50-$3.00. These fees add up fast and cause bank accounts to disappear even faster.

Advice: Open a new bank account at a national bank.

Mistake #3: Not keeping track of finances. As soon as college students get on campus they have a freedom they have never had before. What they also have is more important paperwork being thrown at them than ever before. College students have trouble keeping track of all of this paperwork including monthly bills, loans, financial aid, bank account statements and the effect is missing payments, late charges and missing reference paperwork for the future. When they do not have a system or a place for all of this incoming paperwork and bills, they get overwhelmed and financial mistakes get made.

Advice: Set up a system and get organized.

The National Retail Federation predicts that families will cut back-to-school spending by 8% this year, as they adjust to job losses, reduced hours, and lower credit limits. Those statistics paint a picture, but the rows and rows of plastic bags filled with notebooks, pencils, magic markers, and backpacks hanging in K-mart’s layaway department awaiting payment, paint an even more vivid picture of how the financial crisis is affecting families.

A record number of shoppers are relying on layaway programs to pay for their childrens’ school supplies- which let shoppers pay over time, interest free, and pick up their purchases when they are paid of in full. It’s a good deal considering the sky-high rates that credit card companies have imposed on many struggling families.

Typically, Kmart sees layaways pick up around Halloween, as shoppers get a head start on Christmas shopping, but this year people are setting aside even the most basic items. Retailers who don’t offer layaways say shoppers are buying less and more are paying with cash rather than credit. 

http://www.newsobserver.com/business/story/1661005.html

Since 2005, tuition in New Jersey’s public colleges and universities has increased an average of 7.4% per year but this year the trend has changed, offering students a little break. Thanks to the federal stimulus funding and a cost limit imposed by state lawmakers, students attending Public Colleges and Universities in New Jersey will see the lowest rate increase on their tuition bills in more than 20 years. To add to the good news, many campuses in New Jersey said they expect financial aid to grow, and according to the Higher Education Student Assistance Authority, state grants and scholarships will also increase by 11.7%.

http://www.nj.com/news/index.ssf/2009/08/federal_money_state_cost_limit.html

The Philadelphia School District and its 16,000 member union are in negotiations to reach a new contract agreement before their current pact expires at this month’s end. Superintendent Arelene Ackerman wants to bring changes to a district where half of students can’t read or do math on grade level.

Proposals sent to the Philadelphia Federation of Teachers include lengthening the teacher work day, tying teacher pay to student test scores, eliminating traditional teacher transfer nights, and cutting excess pay for teachers who teach a sixth class each day.

In addition, teachers would need to arrive 10 minutes prior to their students’ arrival and stay 10 minutes later, middle school teachers would have less prep time, and the administration would dictate all teachers’ prep time for a portion of the week. For the 95 lowest-performing schools, the principals would set the terms and benefits for the teachers and make teaching summer school a requirement.

Union President Jerry Jordan said they may arrive at an agreement before the deadline, but they won’t be able to seal the deal until the budget is approved and the district knows how much state funding they will receive. 

http://www.philly.com/philly/news/breaking/20090818

In the tough job market, grads are finding it increasingly difficult to land a job post graduation, so new programs are focusing their efforts on lending a helping hand. BridgeSpan Financial introduced SafeStart this week, which helps grads who are either unemployed or have loan payments greater than 10% of their income to repay their student debt. For an upfront payment of $40-$60 per $1000 of student debt, students can get an interest-free line of credit that can be used to repay federal student loans for up to five years after graduation. 

http://www.usatoday.com/money/perfi/college/2009-08-13-unemployed-graduates-debt_N.htm

As families struggle to readjust to lower incomes, many students are facing the tough decision of whether or not to transfer to an in-state college to save on tuition and eliminate their housing costs by living at home. In NJ, some colleges are attracting transfers by offering more scholarships and ramping up programs to welcome them on campus. Monmouth University saw a 40% climb in transfer applications this year and Fairleigh Dickinson University and Richard Stockton College observed similar trends. College officials actually find transfer students more attractive- at Monmouth, figures show 85% of transfer students graduate compared to just 60% of traditional students, so colleges are responding by offering more financial aid to transfers. 

http://www.nj.com/news/index.ssf/2009/08/college_students_from_nj_trans.html

As cash-strapped families try to readjust to lower incomes, many are finding it harder to pay for their childrens’ college educations. The numbers are staggering- financial aid applications have increased 21% nationally, in the first quarter of this year compared to last. State universities are expecting an increased number of students, as many downsize from more expensive private schools. At Lebanon Valley College, the number of students who appealed for more financial aid has increased four-fold and many others colleges are seeing similar trends.

As negotiations continue to finalize the PA budget, universities can’t be sure of what their own budgets will entail, so they can’t guarantee that students will receive grants on time, or whether those grants will be reduced—leaving both the universities, and students anxiously waiting.

http://www.pennlive.com/midstate/index.ssf/2009/08/college_aid_requests_are_risin.html

Every Wednesday from 5:30- 6 PM on NBC10, we bring you a half hour filled with career help, free stuff, deals, money saving tips, and much more. You can always come to www.tracydavidson.com to catch up on information and helpful links you may have missed during the show. 

Back to School Shopping on a Budget

Back to school shopping on a budget this year? We’ve scoured the shelves for the best deals and made a printable list for you to take on your shopping trip to save big.

Printable List for the Best Priced School Supplies

Cash for Clunkers

If you’re interested in participating in the “Cash for Clunkers” Program- but aren’t quite sure of the procedure, requirements, etc. check out www.cars.gov – you’ll find everything you need to know about trading in your clunker on this website.

Websites We Love

So many people are looking for jobs right now, and there are a lot of job search engines, but which one will get you a job? Check out CareerLink - it’ll let you create a résumé, match your skills and backgrounds with job openings.

Free Stuff

*When you become a Movie Watcher’s member at AMC, you’ll get FREE popcorn on Wednesdays.

*On Tuesdays and at some locations, even Saturday nights from 4 PM until 10 PM, kids eat FREE at Denny’s!

*On August 13th at 8PM, come out and see the movie Marley and Me for FREE at Penn’s Landing, under the stars!

This year, there was a 70% increase of unemployed workers ages 55 and older, and it’s becoming harder for seniors to live on Social Security alone considering 35% of workers have no retirement savings. A federally funded program called Experience Works, has been around since 1965, but now their business is busier than ever. It provides training, for between 6 months and two years, and pays participants minimum wage while they intern in partnering government or nonprofit agencies.

To qualify, a person must be unemployed and in a household where the total income is close to the federal poverty level. The amount depends on the household size, but for someone living alone it’s about $13,000. For more info: http://www.experienceworks.org/site/PageServer

http://www.courierpostonline.com/article/20090803/NEWS01/908030333/1006/rss01