Student Finance – Reducing the Cost of Education

As we all know, being in education can be a very expensive time. It often has significant costs (accommodation, food, bills, books etc) and, because it can take up a lot of your time, you are often left with little or no time to work to pay for your education.

Thankfully the government recognises this fact, and also realizes that education is crucial to our country’s long-term growth prospects. As a result, it offers several tax breaks for those in education. The following are a few of the more common ones, which may well apply to your or your children:

1. College Costs

If your income is below a certain level, currently $65,000, you are allowed to claim up to $4,000 in tax breaks on your college costs. Even if you income is higher than this ($65,000 – $80,000), you can still claim $2,000 in reduced taxes.

To claim back tax on the costs of your education, you need to complete an IRS Form 1040.

2. Tax Credits

There are a couple of tax credit schemes that you can take advantage of if you have low to moderate earnings. The first is the Hope Scholarship, which can be worth up to $1,500 for each of your first two years at college. The second is the Lifetime Learning Credits scheme, which is worth up to $2,000 per taxpayer.

There are a couple of conditions which apply to these schemes – first, a student may only make use of one of them each year. Second, you are not allowed to withdraw money from certain types of saving account while claiming a credit. Third, you are not allowed to claim college expenses at the same time. However, both schemes offer significant advantages, making them well worth investigating.

3. Tax Free Educational Accounts

There are a couple of types of bank account that you can use to protect your savings from tax, and to help fund your education. These are Education Savings Accounts (ESAs) and section 529 plans. In both cases, your money is not taxed provided you withdraw it and use it to pay for legitimate education expenses.

The only real downside to using these accounts is that they may make you ineligible for other types of educational funding help, so you should check with your financial advisor or speak to someone at your bank to help you decide which is best for you.

As you can see, funding your education doesn’t have to be as expensive as it can seem. The government has provided a number of tax benefits for students, but it’s up to you to make the most of them.

The Do’s and Do Nots of Student Finance

As a new student you’ll find yourself bombarded with offers of loans and credit cards, even though we’re in the middle of a credit crisis. You’ll probably find yourself very tempted to spend all of it too! However, try to remember that statistically, in addition to your government student loans, by the time you’re sitting your finals, you may owe around £8000 on your credit cards. If the interest on the cards is an average of 17-18%, you could be in your late thirties before you’ve paid it all off.

It’s way too easy to squander your student loan and to run up big bills on your credit cards on buying things that just make life a bit more fun; DVDs, games consoles, even just ordering takeaway and pizza, but if you do that, where are you going to get money from when you need books or to pay for your accommodation? Chances are, you may end up using your credit cards to pay for those vital things and with interest, you’ll pay a lot more for that pizza or curry than if you’d budgeted for entertainment expenses out of your grants or student loans.

You might also end up damaging your credit history long-term because if you continually max out your cards and then get new ones, your credit history may indicate that you’re a compulsive spender who’s probably going to run into difficulties making the repayments. So when getting credit really matters, such as for your first house or car, you may not find it very easy to convince anyone to lend money to you.

Not making a budget – and sticking to it – is one of the biggest mistakes you can make, so from the very start of the new term, make a list of how much money you have available from grants, student loans and your job if you have one, and then make another list of everything you have to pay out weekly and monthly. Be sure to budget for food and entertainment; there’s no point ignoring the cost of going out so allow for it in your budget. If you allow yourself a certain amount each week – and don’t overspend – then there’s no reason why you can’t get through uni with only minimal credit card spending.

Student Finance for Chinese Universities

Chinese universities have recently started to attract a lot of students from abroad. The trend began in the 1950s and recent statistics shows that there were close to 410000 students studying in China as at end of the last decade. There were students from 125 countries and regions. There are undergraduates, postgraduates, doctoral students, trainees, scholars, and students pursuing research coming to China. China is one of the attractive education hubs. Infact, statistics shows that China was the 10th most popular destination for US students going abroad and third most popular non-western nation. However, foreign students cannot be employed in China while at study. Therefore, students must be able to support themselves and arrange for student finance before enrolling in a Chinese university. If you are one of them, how do you go about getting China university student finance? Read on.

Government help to students seeking finance to study in a Chinese University

Good news is that the Chinese government is encouraging its colleges and universities to expand the scholarship amounts and widen the horizon of fellowships and scholarships to foreign students and China university student finance. They are also encouraged to collaborate with private sector and come up with attractive scholarships for outstanding foreign students.

Already the Chinese government has approved finance worth $362 million to around 350,000 students looking to study in Chinese universities since the introduction of subsidized loans since 1999. The extent of subsidy provided by the government is 50% of the interest amount which is paid by the government and the remaining is paid by the students along with the principal.

However the government itself recognizes that the percentage of students who actually got the loan approved stands at 31.2% which is low and the government would like to grow this figure. The main cause for the low percentage is attributed to the fact that the private sector banks are not too keen on providing finance to students who want to study in Chinese universities as the loans are not required to be backed by collateral. Whether loans will be given out or not is determined based on the credit worthiness of the students and the absence of collateral is a deterrent in providing finance. As of now the People’s Bank of China has appointed four main commercial banks to provide finance to Chinese students which are Bank of China, China Construction Bank, the Agricultural Bank of China and Industrial and Commercial Bank of china.

However such finance schemes which look at subsidizing interest repayments are at present only available to Chinese students who are Chinese citizens and have passed the requisite academic examinations

I am not Chinese, can I still get finance to study in a Chinese University or China university student finance?

There are finance programs available to international students who want to study in a Chinese University. One of the popular sources which the students are using today is to go to china by enrolling in an exchange program in a university that offers this option. Normally a host of universities have exchange programs going in which students from their universities visit universities abroad and students from universities abroad come and study in their colleges. These schemes exist not only for students who want to study but also for students interested in internship and working in these countries.

The main requirements of getting finance are credit worthiness, passing the requisite tests and getting through interviews and in some cases having collateral against the loan as well. However in the case of China some universities additionally put up the condition that the students should have a working knowledge of Chinese or Mandarin to be eligible.

There is a growing number of American students who are now interested in studying in China while in the past this was to gain exposure culturally and most of the students were of Chinese origin born in American the trend is changing now. More and more students are coming to China not only to gain cultural knowledge but also advance their careers professionally when they get back home. As a result commercial banks have also designed specialized finance programs with the needs of the students in mind and it is becoming increasingly easy for students to find such loans as China’s Universities are becoming popular as an international destination for further education.

What You Need To Know About Student Loans and Finances

Often, when a student starts to prepare for college, they do not realize what it entailed, and how overwhelmed they will be before the process is over.

The student loan process is a long and arduous process that most often will have to be repeated for multiple loans. Choosing the right loans and lenders will take a lot of time and research.

Government loans are offered to combat the rising cost of education. They realize that students and families cannot afford college on their own, and that it would be too much of a hardship to try.

Federal student loans given to students with the contract terms stating that the loans will be repaid when the student graduates from college. The standard repayment time is up to ten years.

Monthly payments are generally what the student pays, and the amount is in accordance to their income. There are some repayment plans that will raise their payment every couple of years because in the real world, raises and promotions occur frequently.

Keep in mind that with federal student loans comes a very high interest rate. This rate is figured into the loan repayment and over a ten-year period, can far exceed the original loan amount.

Other types of student loans include a parent loan and a private student loan. A parent loan is just as the name indicates. The parent or parents may borrow money to cover tuition for college, however one of the major drawbacks to a parent loan is that once the loan has been approved, the repayment process starts immediately.

A private student loan involves the student applying to a bank or lending institution. Once approved the student can attend college worry free until he or she graduates. The repayment process for a private student loan is only six months however in some instances, it can be extended for up to one year at the discretion of the lending institution.

With the rising costs of higher education growing everyday, students and their families need to know what they are facing when it comes to student financing. It is crucial that you do as much research and ask as many question as necessary for you to be comfortable with your choices.

Once you have signed the application and then the contract, you are legally responsible for the repayment process. Good luck with your schooling!

Student Grants and Loans Should Be Every Student’s Priority

Student grants and loans are a very important factor, which all students and potential students should be considering, as they set out on their educational journey.

Nowadays, in particular, the cost of living has skyrocketed and therefore many people find the prospect of furthering their education rather traumatic, when considering the financial implications this could have on their lifestyles.

Student grants and loans are designed for the soul purpose of helping the student out financially so that they can progress towards a career that will improve their future prospects.

When it comes to the two options of student grants and loans; student grants are the more appealing of the two because they are ‘granted’ to the individual, much life a gift. This means that the money never needs to be paid back. Loans on the other hand do have to be repaid but these have an appeal of their own too, because the interest rate on a student loan is always very competitive when compared with traditional loans. There is also very often a period of grace, by which the beneficiary is given time to start earning before they have to begin the repayment process. In some countries the loans do not ever have to be paid back until you start earning above a certain level of income.

Finding out which student grants and loans you are entitled to can be a daunting process. However, there are many good information points that you should begin with. First and foremost you should contact the administration office of your chosen place of study. They should be able to give you advice and if they do not know the answers directly themselves, they should certainly be able to point you in the right direction.

In the United States the FAFSA is a helpful organization and in the UK, Student Finance England often has the answers.

Coronavirus Driving People From The Stock Market

The coronavirus’ stock market impact is immense. It is spooking stock markets. The Dow Jones Industrial Average (DJIA) shed 12% or over 3000 points over five days, February 24-28, the largest 5-day drop since the Great Recession. The DJIA recorded the biggest single day drop (1191) during that week on February 27.

China is a key player in companies’ supply chain. That’s why analysts fear firms in China won’t deliver parts to companies like Apple and Walmart, which will cause these firms’ results to suffer. The fear of the unknown is causing panic. Stock markets hate uncertainty, and this virus comes with an abundance of uncertainty: When will there be a vaccine? How will countries contain it, and so on?

Coronavirus’ Stock Market Impact Could Linger

Nobody knows how long the coronavirus’ stock market impact will last. But history shows us that stock markets over-react and then continue their upward momentum. Today, the rapid proliferation of the virus increases fear, so people are over-reacting. We need to pause and not rush to the exit.

Markets recovered quickly from past viral outbreaks. Will the coronavirus’ stock market impact lead to a realized capital loss to you? The market change, per se, does nothing. You lose funds only when you sell below market price. Some firms’ results will suffer in the short-to-medium term because of insufficient inventory. Other companies will gain. Although we do not know the virus’ severity, judging from past market responses, caution is the key response.

Are you a value investor with targeted companies in your portfolio? Examine your goals and stay the course unless you see changes in the firm’s intrinsic value. Have you been speculating, looking to make a quick buck with a margin account? If so, you will have a challenge because banks will call your margin. That’s the inherent risk when you use a margin account to speculate.

If you are not a speculator but a value investor, now could be the perfect time to identify value stocks and select those at bargain prices. There will be several. Whoever you are, be cautious, reject the herd mentality, and reflect on these matters:

Stay The Course

Review or develop an investment goal and plan before you adjust your portfolio. Why have you been or do you wish to invest? Your reason will decide your investment strategy. My preferred strategy is to buy blue chip equities with a long history of increasing dividends. I hold these shares, review their fundamentals from time to time, and act when there is a permanent change.
You will find value stocks today. Market fluctuations provide a great opportunity to buy solid companies with good track records. Remember, you lose, or gain on sale only, not when markets fluctuate.
When your investments’ intrinsic value change, confirm your strategy, and sell your holdings, even at a loss; don’t time the market recovery. The market could be down for several years like the Tokyo Stock Market, which has been below its bubble heights for over two decades.
Don’t let generic asset mixes influence your asset allotment between stocks, bonds, cash, commodities. You are unique, and your mix should fit you at your life stage. Think before rushing to so-called safe-haven commodity assets such as gold that has no intrinsic value.
If you are in the retirement red zone, five to seven years to retirement, your goal must be capital preservation, so avoid the stock market.
Don’t panic: focus on your goals, plan, long-term strategy. Update these and ensure they fit your needs and your risk profile.
This, too, will pass, but God alone knows the timing.