Posts Tagged ‘students’

Affinity Agreements Still a Moneymaker for Higher Education

A common moneymaker in collegiate circles is the sale of alumni and students’ information through the use of affinity agreements. Many believed that the passage of the Credit Card Accountability Responsibility and Disclosure Act of 2009 would curtail these business practices, but a clause allows these credit card programs to continue provided they disclose their dealings. The act does not cover other industries. The question many parents and students are asking is “Can the school sell my personal information?” The answer is yes and it is still legal.

In higher education, affinity agreements have become an excellent way to make money and many companies take advantage these programs. They provide car rental discounts, mobile communication packages, campus Internet access and even vending machine displays. Companies encourage students to sign up for special offers or services and the university financially benefits.

The Credit Card Accountability Responsibility and Disclosure Act of 2009 brought the use of these programs to the public’s attention, but it does not abolish the practice. It only limits banking affinity agreements and protects students until graduation. Pennsylvania Congressman Patrick J. Murphy (D-8th District) has proposed additional disclosure measures focusing on financial institutions. It is unclear as to whether Murphy supports abolishing the practice of all affinity agreements.

Under the Credit Card Accountability Responsibility and Disclosure Act of 2009, colleges and universities must publicly disclose their marketing relationships with credit agencies but it does not restrict the college or university from providing the names of alumni for marketing purposes. Credit card agencies must now submit an annual report containing full disclosure of their dealings on campus. The report includes all business, marketing, promotional agreements and an account of all credit cards issued to both student and alumni.

J.P Morgan Chase, Citigroup, Wachovia, Wells Fargo and Bank of America have signed affinity agreements with many universities and colleges. The media tends to focus on Bank of America since it has been the most forthcoming in the publishing the extent of their affinity agreements. According to a November 30, 2009 press release, the bank has 800 collegiate endorsements including 70 percent of the schools in the Big 10, Big East and Pac-10 athletic conferences and five of the eight Ivy League schools. The question alumni must ask is how are these revenues from banks and other companies used to benefit students. The 2009 the Credit Card Act did not require this disclosure.

Anastasia Zoldak

With lenders tightening their standards, and with new credit card rules, many are finding that it is not as easy as it once was to get a credit card. Indeed, proof of income is needed, and for the best credit cards you will need a credit score that is at least fair to good. If you do not meet these qualifications, you may need a co-signer to get a credit card.

What is a Co-signer?

A co-signer is someone who accepts responsibility for the loan or credit card if you cannot pay. If you do not have good enough credit or a high enough income to qualify for a credit card or some other type of loan, a co-signer will vouch for you, taking on the responsibility for the loan. This person should have good credit and sufficient income.

When someone co-signs for a loan, it means that he or she is basically taking on the debt. You should still make your payments on time, but if you don’t, the creditor can come to the co-signer to fulfill the debt. Additionally, the co-signed debt shows up as part of the co-signer’s debt burden, so their debt-to-income ratio rises. A co-signer is taking on risks when he or she backs you up, agreeing to pay on the loan if you default. If there is a chance that you will default, or if there are doubts about whether you are responsible enough to pay on time, you may have a hard time convincing someone to co-sign for you, since most of the risks are taken on by the co-signer.

Choosing a Co-signer

If you are responsible but you do not have established credit or a full-time job, you might be able to convince someone to co-sign for you. This person is usually a relative, often a parent. You might also find a very good family friend to co-sign on a credit card for you. When looking for a co-signer, you should find someone who has good credit, a low debt-to-income ratio, and who is not planning major purchases for at least six months. This is someone who is likely to handle the debt well, and who can afford to co-sign for your credit card.

Once you have your credit card, you should show your appreciation to your co-signer by using it responsibly, paying on time, and in full.

Jean Marquit

Going to college is the first step towards independence for many young adults. Many attend colleges in their home state, living on their own in dorms or apartments. During these college years a student’s main concern should be on studies and how to pursue a career upon graduation. Unfortunately, rising debt lurks in the shadows for many of these students and when they graduate, the harsh reality of this debt brings puts a tether hold on some of their plans and goals.

College Debt

It used to be that credit card debt was the big culprit for the debt college students had upon graduation. However, with the Credit Card Act of 2009, that debt won’t be a factor. But the debt of college students will still be as high as before and some instances higher. In recent years college students have been borrowing more money than they ever have in the pursuit of higher education. So many students’ borrowing has increased to keep up with the costs of rising tuition.

Tuition Hikes the Main Culprit

There used to be a time when a person entering college fresh out of high school only needed to take out a college loan for a couple of thousand dollars each semester. However, with the cost of tuition rising significantly each year, students are borrowing twice as much just to pay for an education. In fact, college tuition hikes have passed the rate of inflation. According to the College Board, between the years of 1999 to 2000 and 2009 to 2010, college tuition has increased at an average annual rate of 4.9 percent over the general rate of inflation.

Life-Altering Effects of Increased Student Borrowing

Federal Direct and Stafford loans typically give graduates a six-month grace period before they have to begin repaying their loan. However, with the current economic situation and unemployment still high, finding good paying jobs is becoming difficult for some. Even when a decent-paying job comes along, plans such as getting married and purchasing a home are put on the back burner, as graduates find themselves living paycheck to paycheck.

There may not be a way to avoid borrowing for college tuition. However, if college students are made knowledgeable about how student loans affect their lives after college, they can be better prepared to handle the debt. Financial education on debt and borrowing can benefit students a great deal and help them develop a plan to handle the debt college tuition helped them to accrue.

ShawnTe Pierce

The new Current Card from Discover is one of many financial solutions aimed at the teen and young adult market. This particular tool is a debit card that offers an unprecedented level of control for parents, while helping teenagers learn how to manage their finances before they step foot in the “real world.”

Unlike credit cards, the Current Card allows teens and parents to load it with whatever cash they feel is appropriate. Once they have put cash on the card, parents can set parental controls on how their teenagers can use the card as well as where they can use it.

Loading the Card

The Current Card from Discover is different from most teen credit cards in that the amount available to use for purchases and withdrawals is established by how much is deposited into the account. For example, if a teenager’s parents load it with $500, he or she cannot spend more than $500. In other words, it works like debit cards do when attached to savings or checking accounts.

The Current Card can be loaded for free from any bank account or credit card. It is even possible for parents to establish recurring deposits, such as $200 per month from a credit card. There are no minimum balances, loading fees or credit checks required with this card.

Free direct deposit is also available for this teen debit card if it is more appropriate. For example, teens with summer or after-school jobs can have their paychecks deposited directly into their Current Card accounts.

Setting Limits

The most unique feature of the Current Card from Discover is the ability to set myriad parental controls so parents can monitor and control their teenagers’ spending habits. The available controls include:

• Spending Limits:
  Parents can decide how much money their teenagers can spend in a given period of time. If the teen tries to exceed that limit, the card is declined.
• Shopping Categories:
  With cash or other teen credit cards, teenagers can spend their money wherever they wish. This isn’t the case with the Current Card, as parents can restrict certain shopping categories, such as tobacco or liquor stores or hotels.
• Activity Alerts:
  In addition to letting parents decide how teens will use the Current Card, this card also informs parents of purchases and withdrawals. Messages can be sent via text message or e-mail.

Other Perks

The Current Card comes with the same convenient perks you might expect to find in other teen credit cards, such as no liability for fraudulent purchases. Card holders can withdraw cash from the card at any ATM if they are unable to use the card itself, and the card also comes with exclusive discounts at many favorite teen shopping destinations.

There are seven available designs for the Current Card from Discover, which makes it particularly attractive to the younger market. Teens can not only learn to manage their finances, but do it with a sense of style.

Steve Thompson

Trips to Europe might get a bit more complicated for Americans if European financial institutions have anything to say about it. American Banker reports that the chairman of the European Payments Council, Gerard Hartsink, has suggested that once a switch by European financial institutions to the EMV integrated circuit card is completed in 2011, a recommendation could be made to stop accepting magnetic swipe credit cards. This news could bode poorly for American travelers, who often use their credit cards to both withdraw spending money in local currency and to make purchases while traveling abroad.

Rather than using magnetic swipe strips on the backs of credit cards to read customer information, EMV credit card chip enabled credit cards are inserted into a handheld device. The customer then types in a four-digit PIN to confirm their identity. Deemed more secure than traditional credit cards, EMV technology is set to become the new industry standard throughout Europe.

While Europe has emphatically supported credit card chip technology, and all financial institutions will be switched to it by 2011, America has lagged behind, with consumers and retailers still utilizing magnetic swipe credit cards. Herein lies the issue for American travelers: If European banks choose to eliminate their support for magnetic swipe credit cards (current handheld machines in Europe have the capability to accept them), American travelers may need to find a new way to pay for things while overseas.

While credit cards with chips are hard to come by in the US, there are other options. A few prepaid credit cards offer PayPass—a chip system used by MasterCard. The Exact MasterCard is a prepaid debit card that offers PayPass as well as direct deposit.

Evidence of trouble between the EMV and magnetic swipe systems is already creeping up for some travelers. According to EuropeForVisitors.com, newer self-service machines at railroad stations in France won’t accept magnetic swipe credit cards. In addition, those traveling with magnetic swipe credit cards may have to explain their use to smaller retailers, something difficult to manage if a language barrier exists. While problems are relatively small now, expect them to expand once the EMV switchover is completed in 2011.

If you’re planning European travel between now and 2011, you should still be able to use your traditional magnetic swipe credit card. However, a phone call to your credit card company may give your more insight, as these issues are certainly set to take center stage for them within the next two years.

Kelly Herdrich

People seem to be customizing everything these days. There are skins for cell phones, iPods, laptops, and so much more. Why not credit cards, too? For many, their credit card may be the most-used possession they have. Some may feel that if it’s going to be used often, it might as well reflect who they are.

Custom credit cards

Credit card companies understand that consumers like the idea, so many offer custom credit cards and credit card designs. Discover’s More card has multiple custom image options, for both consumer and student credit cards:

• The Wildlife credit card features images such as an eagle, wolf, horse and more
• The Sealife credit card’s options include a shark, dolfin, turtle, clown fish and others
• The Monogram credit card displays the cardholder’s initials (or any three letters) and a choice of several stylishly colored backgrounds: girly pink, lime green, elegant black and many more

Capital One’s Card Lab also allows consumers to choose custom credit card images and designs. In fact, just about any photo that you’ve taken — everything from that of a pet to one of your children — can grace the front of your Capital One card.

Credit card designs

If your credit card company doesn’t offer custom credit cards or credit card designs, there still are ways to customize your credit card. CreditCovers.com provides credit card slipcovers, or “skins.” The skins come in a wide variety of credit card designs. Custom skins also can be created based on individual or business wants and needs. These custom credit card designs are easy to apply and easy to remove. The company promises that they are durable and won’t interfere with credit card usage. The only card it doesn’t seem to work with is a smart card — those credit cards that store credit information on a tiny computer chip.

Is it legal to customize credit cards?

Depending on the credit card company, there will be different guidelines to follow. Always remember to read the terms and conditions associated with your credit cards. As long as the credit card designs are not in violation of those terms, customizing credit cards should be perfectly fine.

Lyn Lomasi

Good Careers in a Bad Economy, Part 5

As teens and young adults pursue good careers in a bad economy, they will be told that their quests will be difficult.

Some analysts will inform them that they can’t really get anywhere without a college degree. They will be told that the world has gone from making things and doing things to a high-tech global information society. In short, things have completely changed.

After all, this is the worst economy, with the worst career prospects, since the Great Depression. The U.S. Bureau of Labor Statistics reported an unemployment rate of 8.1 percent at the end of February 2009, up from 4.8 percent a year ago, and could be heading toward 12 percent or more.

What’s a young person to do?

Career counselors Bob Rosner and Sherrie Campbell on Payscale.com encourage a back-to-basics approach. They assert first that while the economy is changing, there still is demand for traditional jobs, and that not all of them require four-year college degrees. They add that no matter what, you must “Stay positive during a recession.”

Make a Plan and Stick With it

The process of planning for a good career — both in a bad economy or a good one — starts with the basics of taking pen and paper and mapping a step-by-step plan. Or nowadays, a computer screen will work just fine.

Good Careers in a Bad Economy
Part 1: Graduating in a Recession
Part 2: According to the March 2009 Bureau of Labor Statistics
Part 3: Potential Careers Arising from the Stimulus Bill
Part 4: Career Forecast: Look for Overlapping Opportunities
Part 5: Career Planning: The More Things Change, the More they Stay the Same

First, make a list of careers that are of interest to you. Don’t concern yourself with the bad economy. You can whittle down your list later. And, as outlined in the first report of this series, you can pursue a dream career and a more realistic recession-proof career at the same time.

Dare to dream. Have your eye on star athlete or entertainer, corporate chief executive, “green” energy entrepreneur, heart surgeon, even president of the United States.

Explore more down-to-Earth careers. Think school teacher, carpenter, nurse, mechanic, insurance representative, police officer. Most jobs, in spite of all the global economy talk, are still old-school jobs. Society still needs food and shelter, public schools and public safety, health care and transportation.

Think of overlaps to broaden your prospects. For school teacher, write “educator” because who knows, you may become the superintendent of schools. For carpenter, put “contractor” because you just might start your own company.

Think of career cousins. Career counselors Rosner and Campbell describe “career cousins” as careers that are similar. If you have dreamed of being a teacher, for example, you might also find an interest in social work.

Once you have made your big list, pick two or three options for careers. Explore the book studies and/or training programs that are required. You’re not alone, because virtually all schools and training programs have career counselors. Find a good one and keep in regular contact.

Cope With the Cost of Education and Training

The pursuit of a good career in a bad economy, or any economy, requires more than good intentions. A young person also needs resources.

Members of today’s up-and-coming generation face a challenge. According to the National Center for Public Policy and Higher Education, 47 percent of households say their children can’t afford to go to college.

Policymakers are aiming for reforms. Some state governments are rewarding publicly-funded universities that hold tuition in check. The new American Recovery and Reinvestment Act, otherwise known as the $787 billion economic stimulus package, includes $2,500 college-cost tax credits for this year and next year.

Community colleges are a lower-cost option for getting started. Many professions, ranging from building trades to nursing, do not require four-year degrees. Furthermore, most students who achieve those so-called four-year degrees actually invest more than four years; six years is the average, with breaks taken to save money for the next round of tuition.

Students this year will receive a combined $143 billion in grants and loans, according to the College Board. Some 38 percent of full-time students will pay less than $6,000 a year, but super-elite schools drive up the overall average. The College Board is among many scholarship search sites.

Pursuit of a good career requires hard work. Pursuit of tuition for college or training is the same.

Remember that at some point in society’s chain, there is a link to fill that is essential. Try to find a career link that you will enjoy.

Michael Thompson

Good Careers in a Bad Economy, Part 4

Much is said of the “green” environmental movement providing good jobs in a bad economy. Therefore, a young person might perceive that working in the energy field is an either-or proposition. Either you ride the wave of the future by studying solar or wind power or fuel cells, or you concentrate in the traditional fields of oil and gas.

Not necessarily. A great deal of overlap exists. Besides, alternative energy will take years to develop. Even the most optimistic plans call for utilities to generate only 20 percent or 25 percent of their energy from alternative sources, often with a target year of 2015 or 2020. There still will be plenty of oil, natural gas and coal to burn until at least the middle of the century.

More Career Overlap Potential

Consider small business, which is regarded with gloom and doom in many circles because of the bad economy. What if an entrepreneur were to overlap a small business into an international business? According to the U.S. Department of Commerce, small companies provide 96 percent of export volume. As noted on www.myownbusiness.org, America offers 300 million potential customers; the planet, 6.5 billion.

Or how about law enforcement? In the age of terrorism, law enforcement no longer stops at America’s shorelines. There is so much international overlap, creating so many job opportunities, that even the FBI and the CIA have taken the unusual steps of recruiting applicants with ad campaigns. The CIA pitch states, “Consider the global employment opportunities at the CIA. We’re looking for a diversity of people for the important job of keeping America safe. This includes Clandestine Service Officers to be on the front line of human intelligence. Plus, individuals skilled in science, engineering, technology, analysis, foreign languages and administration for positions in the United States and overseas.”

In science and technology, analysts often assert that America must gear up for global competition. This is true, but again there is a career overlap because America also is part of a move toward international cooperation. Just one prominent example is the International Space Station.

As young adults focus both on dream careers and recession-proof careers, they should look for these types of overlaps as paths toward opportunity.

Energy Careers Show Overlap Potential

Good Careers in a Bad Economy
Part 1: Graduating in a Recession
Part 2: According to the March 2009 Bureau of Labor Statistics
Part 3: Potential Careers Arising from the Stimulus Bill
Part 4: Career Forecast: Look for Overlapping Opportunities
Part 5: Career Planning: The More Things Change, the More they Stay the Same

A report for the Mother Nature Network Web site demonstrates how careers in the energy field need not be typecast into the traditional or alternative fields.

“Today’s most sought after solar positions are in installation, engineering system design, and sales and maintenance,” it states. “Lucky for you, lots of skills that are useful in the solar industry don’t require a background in solar power, or even renewable energy.”

On the labor level, individuals with blue-collar experience installing gas-fed furnaces might don green collars to install solar panels.

For professional positions, consider a major corporation’s recent job posting for “director of solar engineering.” The listed educational requirement is a bachelor of science degree in electrical engineering “or other relevant engineering degree.” In other words, the corporation was not looking for somebody with a specific degree in solar power.

Still, today’s young adults will find greater opportunities to tailor their education and training toward specific fields of energy industry employment. This is where a college student should establish a strong relationship with a trusted guidance counselor.

As MyGreenScene.com puts it, “University degree programs focused on renewable energy are starting to see the same growth that computer science programs did in the early eighties, and that means the new Energy Age is here.”

But the old Energy Age will still be here for a long time, too.

Michael Thompson

Good Careers in a Bad Economy, Part 3

A career in environmental “green” technology? Scientific research? Health care? Education? Transportation? Construction?

America’s deep economic recession is making an impact on career plans for teenagers and young adults. So is the $787 billion American Recovery and Reinvestment Act, better known as the economic stimulus package, that President Barack Obama signed in February.

The recession, with official unemployment at 8.1 percent at the end of February 2009, is causing many young people to pursue recession-proof careers. They don’t want to fruitlessly study or train for jobs that will scarcely exist in what is shaping up to be a new economy. They want to go where the action is.

As a result, many young people are looking at the priorities established in the economic stimulus package as laid out on Recovery.gov, the Web site that Obama’s team established as part of its promise for an open and public process.

Stimulus Plan is Temporary and Limited

Young people should exercise caution in placing too much stock in the stimulus package for guidance. Some of the stimulus priorities, such as green energy investment, indeed reflect long-term priorities — Obama has pledged $150 billion beyond the initial stimulus over a 10-year span. But other stimulus money, such as for roads and bridges and housing, may represent short-term fixes that will not endure.

Those who are building Recovery.com acknowledge on the site that they are engaged in a work in progress. There really are not a whole lot of specifics.

For example, the primary Obama pledge is to “create or save” 3.5 million jobs during the next few years, a number that gradually has risen from 2.5 million without much explanation. There is no breakdown to indicate how many jobs will be created, as opposed to how many will be saved.

Furthermore, the Web site does not count the numbers of jobs to be created or saved in specific career areas such as how many jobs in energy, how many in housing, etc. The lone breakdown is a map that shows the total number of jobs estimated for each state.

Not all Stimulus Money Goes for Jobs

Good Careers in a Bad Economy
Part 1: Graduating in a Recession
Part 2: According to the March 2009 Bureau of Labor Statistics
Part 3: Potential Careers Arising from the Stimulus Bill
Part 4: Career Forecast: Look for Overlapping Opportunities
Part 5: Career Planning: The More Things Change, the More they Stay the Same

A young person considering a job in health care will enter a field that is generally considered recession-proof. After all, people aren’t going to stop being sick and injured, and shortages are reported, especially a shortage of nurses.

Someone considering the health professions may feel encouraged to note that the stimulus plan contains $147.2 billion for health care. However, little of that money will go toward creating new health care jobs. A chunk of $86.6 billion alone is targeted to helping cash-strapped states catch up with their Medicaid reimbursements.

A career in education often is described as recession-proof, but there still is cause for doubt. The New York Times recently reported that Education Secretary Arne Duncan will use the lion’s share of $100 billion from the stimulus bill to prevent “hundreds of thousands of job losses in schools that had been projected for the fall because of growing state budget deficits caused by a steep drop in tax revenues.” Therefore, a young person considering career plans in education may ask what’s in store for the years ahead, when stimulus payments may not be available.

In the same vein, a project to modernize the nation’s electrical grid may be finished before today’s students and trainees enter the job market. The same goes for road and bridge projects, and for housing improvements.

On the other hand, good jobs could arrive in unexpected places. Financial services may seem a dead horse at this point, but at the point when recovery may occur, financial services could return to high demand.

Sound confusing? The Web site HRworld.com recommends “multifaceted” career plans: “If you don’t put all of your eggs in one basket … numerous failures have to happen before you’re really in trouble.”

Michael Thompson

Good Careers in a Bad Economy, Part 2

Young adults who pursue good careers in a bad economy will encounter not only skeptics, but also cynical humorists.

U.S. News & World Report, for example, placed “federal judge” at the end of a list of the best recession-proof careers. The joke is that federal judges, unlike their state and local peers, are appointed for life.

Then there’s the occasionally morbid “Top 25 Careers to Pursue in a Recession” on HRworld.com. These include careers in casino management, because desperate people will gamble more often, and in distribution and sales of alcohol, because unhappy people will drink more often. Also listed are debt collection and bankruptcy law, for obvious reasons.

For young adults facing the tightest job market since the Great Depression, these wisecracks may not seem so funny.

But chin up. Teens and young adults still should pursue their ideal dream career. If that dream career is also a recession-proof career, all the better. If not, a recession-proof career can offer security in case a dream career becomes a dream deferred.

Bureau of Labor Statistics Tells the Story

The U.S. Bureau of Labor Statistics reported a grim official unemployment rate of 8.1 percent at the close of February 2009, up from 4.8 percent a year ago. Even the most optimistic economists predict a continued rise to at least 9 percent, while the glass-half-empty analysts are forecasting 12 percent or higher.

More insight is gleaned by perusing the Labor Bureau’s specific breakdowns. To get the bad news out of the way, here are some of the dimmer prospects, comparing February 2009 unemployment with February 2008 unemployment (in parentheses):

• Manufacturing: 11.5 percent (5.0 percent)
• Leisure and hospitality: 11.4 percent (8.5 percent)
• Professional and business services: 10.8 percent (6.2 percent)
• Hourly: 9.6 percent (5.5 percent)
• Transportation and utilities: 9.1 percent (4.6 percent)
• Financial services: 6.7 percent (3.4 percent)

On the brighter side, consider education and health services unemployment at 4.1 percent today, compared with 2.9 percent a year ago, and government jobs at 2.6 percent versus 1.7 percent in 2008. These figures still reflect unemployment increases, but the outlook still is more optimistic.

Information technology is a mixed bag, with unemployment in February 2009 at 7.1 percent compared with 5.8 percent last year. This is a case where you may need to be more specific. A report on Examiner.com notes that a number of entry-level information technology jobs are shipped overseas, but computer security still is generally managed by career American employees.

Government Careers? Focus on the Feds

Good Careers in a Bad Economy
Part 1: Graduating in a Recession
Part 2: According to the March 2009 Bureau of Labor Statistics
Part 3: Potential Careers Arising from the Stimulus Bill
Part 4: Career Forecast: Look for Overlapping Opportunities
Part 5: Career Planning: The More Things Change, the More they Stay the Same

For the government employment outlook, the most recession-proof careers are at the federal level. The reason is simple: The federal government can (and does) run up debt, while states and localities are forbidden to do so. Compare the federal response to the recession under President Barack Obama with job creation under legally allowed deficit spending, to the California response under Governor Arnold Schwarzenegger, with job losses required to balance the books.

Another good reason for choosing the federal government is that opportunities are so vast. The quest for alternative “green” energy during the next decade will match the NASA buildup of the 1960s. Even the FBI and CIA have opened their doors with ad campaigns for career employment applicants.

In education, the career outlook is good. However, to truly have a recession-proof position, a specialty in math and/or science is best. This is where the shortages and pay incentives exist.

Payscale.com suggests that the best way to pursue your career dream, and to remain recession-proof at the same time, is to be versatile. This can be compared to an athlete in a team sport who is capable of playing at multiple positions. The more irons in the fire, the better.

Michael Thompson