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Archive | January, 2012

Sallie Mae Now Offering Tuition Insurance For Students

Sallie Mae Now Offering Tuition Insurance For Students

The cost of college tuition has been increasing dramatically over the years — greater than inflation in many instances. Some schools have adopted double digit increases, others try to keep the impact on families at a minimum, while some have taken the Muskingum approach and slashed tuition prices.

Regardless of the various approaches to tuition pricing, the investment in a college education can easily be the most expensive purchase a family can make — with the exception of their home. However, from what I can see with the rising cost of college, it may be possible for that education investment to surpass the purchase price of even a modest home…

Since we insure our homes, would it not make sense for us to want to obtain some sort of protection on our college investment?

Sallie Mae, the nation’s No. 1 financial services company specializing in higher education, believes that a college education is worth insuring. They believe in it so much, they are rolling out a brand new division, Sallie Mae Insurance Services, to offer their services and products to students nationwide.

I recently had the opportunity to sit down with William A. Suneson AAI, Co-Founder and President of Sallie Mae Insurance Services, and learn a little more about the various insurance products they are offering to families.

The following is our Q & A session. I hope you find it helpful as you contemplate protecting your educational investment.

CheapScholar: A lot of families have never heard about Tuition Insurance. Can you provide an explanation of how Tuition Insurance works and why it might be a good option for students/families?

Suneson: After purchasing a home, paying for college is often times the second largest expense for families creating a growing financial risk.  Additionally, many colleges do not provide a refund after the 4th week of classes for medical withdrawals and only provide partial refunds up to that point.  Tuition refund insurance provides families with an option to protect their investment in college should a student be forced to withdraw for medical reasons.  Essentially the coverage provides reimbursement up to the policy limits for tuition, fees, room/board and other related expenses upon the verified medical withdrawal of the student.

CheapScholar: What kind of premium/expense (approx) can a family expect to invest in this type of coverage?

The premium to purchase tuition refund insurance varies by the amount of coverage a student or family selects based on their cost of attendance, out of pocket exposure and risk tolerance.  Through school sponsored plans, our policy premiums range  from $186 for $10,000 of annual coverage up to $486 for $50,000 of annual coverage.

CheapScholar: Tuition Refund Insurance has been in existence on campuses since the 1930’s. What does Sallie Mae bring to the table to help distinguish their newly introduced tuition insurance product from others.

Suneson: Yes, tuition refund insurance has been available for decades but historically only to students attending private institutions or private K-12 schools.  With the growing cost of paying for college, Sallie Mae Insurance Services has launched a modern form of tuition protection that allows students from any accredited college or university to purchase a policy based on their individual needs rather than a single amount offered by select institutions.  In addition to coverage flexibility, our product provides 100% percent reimbursement for mental health related claims rather than the 60% offered in the past by other plans.

Another distinguishing factor and clear advantage of our tuition insurance product is the inclusion of the Student Protection Plan with every policy sold.  This comprehensive bundle of benefits has been specifically designed for college students and includes Identity Theft Protection, Computer Repair Coverage, Emergency Medical Evacuation and Extended Warranty coverage.

CheapScholar: College students have a number of insurance needs during their educational career. Does Sallie Mae plan on rolling out other insurance products and services that may benefit these students in coverage and cost?

Suneson: Yes, Sallie Mae Insurance Services recently launched a suite of products on including renters insurance, travel insurance, student health insurance and other products for young adults post college.  We also have a number of products in development including tuition payment insurance designed to help tuition payers (parents) maintain their payments should something unforeseen happen to them.

CheapScholar: Bill, is there anything I didn’t cover above that you would like to highlight regarding this new venture by Sallie Mae?

Suneson: Doug, Thank you for this opportunity and for bringing awareness to the risks students and their families face during this life stage.  For over 40 years, Sallie Mae has been helping families save and pay for college so protecting that investment is a natural extension of the business.  We are focused on helping students achieve their goals by protecting them against unforeseen risks.

If you enjoyed this conversation and want to discuss the topic further, feel free to leave comments below or you can always reach out to Mr. Suneson on Twitter at BILLSUNESON

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Awesome Paying For College Advice (video)

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FAFSA & Net Price Calculator Tips (video)

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Save Early And Save Often For College Expenses

Save Early And Save Often For College Expenses

For most parents, the moment your kids are born (or maybe even slightly before) you start to think about them attending college. Some parents even go as far as picking prospective schools for their toddler children and start dressing them up in that college’s apparel. (I can attest to seeing a few “Future Buckeye” shirts in our family!)

With all this thought being given to college attendance and selection at an early age, I think that it would only be natural that parents also start planning on how they are going to get their student to that school (from a financial perspective). Based upon this assumption, I have come up with the following tips to help guide parents through a painless approach to saving for college.

  • Save Early: It is never too early to start saving for college. Ironically, it is never too late either. Some folks believe in starting a college savings fund by the time their child reaches Kindergarten. Others have started long before the birth of their first child. The earlier you start saving the better chances you have of securing a sizable college fund by the time your student is graduating from high school.
  • Start Small: One of the main reasons people give for not establishing a college savings fund is that they don’t have the extra discretionary cash to put aside. This may be the case in many households but my guess is that $5 a week or maybe even $5 a month may not be too much of a stretch for families to put into a college savings fund. As time goes on, and hopefully as extra income is available, parents could increase their college fund contributions.
  • Be Consistent: $5 a week does not seem like much but if you start saving when your child is born, you could have $4680 (18x52x$5) in the bank by the time they head off to college… and that doesn’t include any potential growth on the investment. $4680 could cover all of the book expenses incurred by the student during their 4 years of college. Being consistent in your contributions not only helps your college fund but it also establishes a healthy practice of saving.
  • Earmark Windfalls For College: I am not referring to the lottery as a windfall on this one (although that would be nice). I am thinking more along the lines of Christmas money, Birthday cash, Bar mitzvah moolah, etc… Basically, anytime you have extra cash that is for benefit of your child, you automatically put a portion (or all) of it into the college savings fund. This usually works pretty smoothly when they are young and don’t understand how money works but as they get older and “appreciate” what they can do with their cash; you are going to have a hard time diverting some of it to a “not-so-fun” college fund. However, this will be a great opportunity to turn this into a learning moment for your child about the importance of saving.

Practicing What I Preach

I hope the above tips help to get you thinking about the different approaches you can take on starting that college savings fund for your child. I want to conclude this article by giving you a little insight to how our family has established college funds for each of our three children (Ages 4, 3, and 18 months).

In the weeks following each of their births (usually after I got the Social Security card in the mail), I went to our local bank and opened up a savings account for each of our children. We have a set amount of money that is pulled from our household operating account each month and automatically transferred into their college savings accounts. In addition, we have taken every dime of Christmas and birthday money that the kids have received and we put it into those savings accounts. With the exception of a $20 “ticket” (his word not mine) that my 4 year old utilized recently to get a tractor – I told you it gets harder as they get older! Surprisingly, their college funds are doing pretty decent. My next step in this plan is to transfer the funds to a 529 savings option once they accumulate some more growth. My goal is to keep contributing to the savings account and making periodic transfers to the 529 savings fund. Once they head off to college, I will drain the 529 account as quickly as possible so that I don’t have to report it on my FAFSA every year (but that is a different article)…

Hope you found this information useful. Happy Saving!

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Surviving The Campus Dining Hall on a Budget

Surviving The Campus Dining Hall on a Budget

When you go to college, there are certain necessities that you must have. A comfortable place to sleep and good food to eat usually tops that list. Every college is a little different on how they address the dining needs of their students, however, I think the following infographic should be very helpful in providing you some tips on how to survive your campus dining experience.

If need be, click on the infographic to whisk you away to a larger version that is easier on the eyes.

This infographic has been graciously provided by Online Universities Blogs

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CheapScholar & NBC4 – Helping With College Costs

CheapScholar & NBC4 – Helping With College Costs

For those that don’t know, Vice-President Joe Biden recently made a visit to my home state (Ohio) and gave a speech discussing college affordability. Secretary of Education Arne Duncan, made the trip with him and, as you can imagine, they had a lot of information to share.

As part of the coverage for Vice-President Biden, was recently highlighted by Mikaela Hunt from NBC 4 as a resource for  families and students trying to navigate the financial aspect of their college experience. Below is the video from that news segment and here is a link to where it can found on NBC’s site. Enjoy!

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The Freakonomics of Digital Textbooks

The Freakonomics of Digital Textbooks

It seems counter intuitive, at first glance, that students are still using paper textbooks. With iPads, Kindles and other e-readers as common as pizza on college campuses, it’s not a stretch to envision rows of unsold backpacks lingering in bookstores as students add just one more aspect of their lives to the electronic age of the 21st Century. However, that’s far from the case now – though there’s reason to believe that change might just be around the corner where digital textbooks are concerned.

A wide range of costs

By not having to pay printing costs, those sizable savings can be passed on the consumer, in this case the student, right? Well, the answer that is most correct is – it depends. While some of the more sought after textbooks can be had digitally at savings of up to eighty percent compared to bound copies, studies that include other, less popular titles suggest that savings are negligible. Those who’ve finished their schooling, memories of lugging around heavy books around campus, probably have a hard time understanding why anyone would choose a traditional book over an e-book, but there are actually good reasons why adoption has been slow up to this point.

Converging realities

If you’re just entering college, the bottom line is that the future looks bright for your ability to access cheap textbooks. To support this silver lining, though, you need to understand a few key factors in why those costs aren’t already lower, starting with demand.

For many university students, the previous twelve years of their academic life was spent holding, carrying and reading traditional books. Hopefully by the time they began to matriculate into colleges, those in the pipeline had figured out how to really extract a lot of knowledge from a textbook. While their games had mostly moved to the electronics realm, the students didn’t have digital textbooks as part of any tradition. Some of these people became early adopters of digital texts, but most never switched, even for a try. Of those thirty-nine percent who did, roughly one third returned to their familiar, bound texts.

Other reasons for students not trying, or trying and then rejecting, e-texts has to do with the still lingering problem of overall computer skills. Uncomfortable with the interactive features of digital texts, some students made a conscious decision to learn their course skills, but not updated technology skills. In the end, these realities combined to produce low consumer demand for many e-book titles and publishers priced the products accordingly higher as a result.

As college goes, so goes the books

You don’t have to look too far back to find graduates who know the pace of acceleration college has experienced. Now, it’s likely that a graduate received an online bachelor degree, albeit using bound textbooks. Colleges have gone digital in ways unthinkable only a decade ago and Ivy League schools are well known to offer completely-online courses. But while students adapt to digital classrooms, there is still a bit of a lag in adapting to digital textbooks.

A leading reason many students still prefer paper to digital materials has to do with the lack of value added features on even discounted e-books. Students simply aren’t interested in electronic copies of a bound text. However, when a publisher adds value to a text, students respond with their wallets, saving themselves money and providing the demand publishers like to see as they invest more in products that don’t have printing and paper material costs to drive up prices.

Publishers are responding to student quality expectations, and they’re being rewarded by higher sales numbers. The cycle of demand driving down price is already showing up, and for that freshman, this means book costs are almost certainly bound to fall dramatically while he or she is still in college.

Today’s guest article was provided by Joseph Baker.

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Study Abroad on a Budget – U.S. to England

Study Abroad on a Budget – U.S. to England

If you’re undecided as to where you’re going to study, and are up for a challenge, why not think about taking your degree abroad? Over 40,000 American students went across the pond to the UK in 2010 for a summer, semester or a full year.

Finding a course

You’ll need to find a University (College) which has a programme for international students in the course/s you’re taking. A good place to start looking is the educationuk site, which lists all the places of study offering international placements.

If you’re not familiar with the various counties in the UK the site has information on all the colleges and universities in its database, so you can make an informed choice. For obvious reasons it might be easier to choose a placement which includes accommodation.

Getting a Visa

Once you’ve settled on your place of study, you’ll need to decide how long you want to remain in the UK for, and obtain the necessary visa. A ‘student visitor’ visa entitles you to stay in the UK for up to 6 months, without working. A general student visa covers you for up to 4 years and allows you to take a part-time job or do volunteer work while you’re studying.

Finding Accommodation

Halls of Residence tend to be the most popular choice for first year students as it helps them to meet their fellow students and adjust to campus life. Most Halls provide a basic room with a bed, desk and chair, and have a canteen offering cheap meals to the students.

Some Halls are self-catering, with a communal kitchen for all the residents to use. This can be useful if you have particular dietary needs or prefer to bring food from home.

Places in the Halls are limited, although international students are generally given preference so make sure you indicate that you require accommodation when you apply. You can expect to pay anything between £100-£200 per week for a basic room, less if you go self-catering. Utilities and internet bills are included.

If you can’t get a place in Halls, there are always a number of off-campus flats and houses available although these tend to be more expensive and may not be furnished. Rent will vary depending on the location; anything from £50 to £95 per week is considered normal. It’s advised that you start looking for a place as soon as you’re accepted on the course.

Other Costs Involved

Tuition fees in the UK can be much lower than in the US. The highest a UK student can expect to pay is around £9,000 (roughly $14,000), whereas in the US an annual fee of $20,000 is commonplace. Fees are paid as part of a student loan, which is then paid back once the graduate is earning over a certain amount. International students can also get loans for foreign study, but you will need to prove you have a place at a UK place of education before you can apply.

Food: Depending on your preference and where you’re staying, allow around £30-£50 per week. Buying the supermarket own brand products and sharing the grocery bills with your housemates can often work out cheaper than buying everything yourself and getting takeaways every night.

Telephone/Internet: If you’re in shared accommodation you and your housemates will be able to share the cost of the phone and internet, so you could probably get away with a cost of around £10 per week. You could also use internet cafes or University library resources if you don’t need to use the internet a lot.

Cell phones, called mobiles in the UK, will be expensive to run if you keep to a US SIM card. You can get free pay-as-you-go UK SIM cards to use while you’re there, although calling home will use up  a lot of the credit. If you plan to call home a lot, arrange for family and friends to install Skype so you can speak to them over the internet for free.

Household bills, such as utilities and council tax, can be shared with your housemates and you can expect to pay around £10-£15 per week for your share.

Insurance: If you do stay in a private house or flat you’ll also need to consider contents insurance for your personal items, but this can be for as little as £5 per month. If you drive, you’ll also need car insurance which can be rather more expensive. If you get a place close to campus it would be cheaper using public transport. You can get a student bus pass for as little as £9 per week, which will cover all bus journeys in a certain area.


Don’t forget to have fun while you’re in the UK! The legal drinking age is 18, and most University campuses have their own bars serving alcohol well into the night.

Many places offer student discounts, so always carry your student card with you to make the most of this!

Carrying Currency

If you’ve got a credit card already this will probably be accepted throughout the UK. However, it might be easier for you to get a prepaid card which allows you to pre-load it with money before spending it. Many students prefer this option, as prepaid cards can be used just like credit cards but avoid the temptation to run up any debts.

You may need to open a UK bank account, especially if you get a part-time job. You might be able to transfer money from your US bank account to a UK bank, so ask in your local branch at first.

To open a UK bank account you’ll need your passport, letter of acceptance, a UK address and references/statements from your home bank.

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