2013년 11월 30일 토요일

About 'college debt average'|Average College Debt Rose to $24,000 in 2009







About 'college debt average'|Average College Debt Rose to $24,000 in 2009








               College               tuition               fee               is               rising               everywhere,               and               in               fact;               it               has               been               rising               at               much               greater               rate               than               any               other               items.

For               many               families,               sending               children               to               universities               mean               a               huge               financial               burden               for               the               family,               and               for               those               taking               up               student               loans,               they               will               find               themselves               heavily               indebted               before               they               even               find               their               first               job.
               This               unfortunately,               will               become               worse               in               years               to               come,               many               are               suggesting               that               university               fees               could               rise               to               average               $40,000               to               $50,000               each               year               easily,               and               if               you               adding               cost               of               accommodation               and               other               costs,               they               can               go               up               to               $100,000.
               This               is               becoming               a               crisis               that               many               parents               are               thinking               to               give               up               on               their               retirement               money               as               they               have               choice
               The               only               way               is               to               plan               way               ahead               and               start               making               savings               as               early               as               possible               to               avoid               the               future               financial               burden.
               1.

College               Fund               is               a               very               good               idea
               The               concept               of               college               fund               is               well               understood               in               North               America               and               certain               parts               of               Europe.

Some               governments               even               put               in               incentives               to               co-invest               into               your               education               funds.

The               concept               is               very               similar               to               your               retirement               fund;               most               people               use               mutual               funds               as               a               way               to               put               regular               savings               into               college               fund.
               One               thing               to               remember               is,               college               fund               is               a               very               long               term               investment,               usually               10               to               15               years;               you               need               a               balanced               approach               --               it               is               a               good               idea               to               mix               them               with               stable               and               more               aggressive               investments;               and               not               entirely               on               cash               or               stable               investments               as               you               do               need               to               beat               the               inflation               as               college               tuition               fees               do               rise               above               inflation               rate.
               2.

One               share               a               year               makes               a               lot               of               difference
               Buying               one               share               for               your               children               at               their               birthday               or               Christmas.

I               read               a               story               where               a               grandmother               used               to               buy               one               share               a               year               for               her               birthday,               over               14               years,               she               had               accumulated               wealth               of               $7,000;               however,               she               had               sold               her               shares               every               year               in               exchange               for               cash,               had               she               kept               them,               it               would               worth               $44,000,               enough               for               her               to               pay               off               her               college.
               There               are               many               companies               now               offering               this               kind               of               service,               and               you               can               choose               a               variety               of               the               companies               to               invest               --               they               will               also               send               you               a               share               certificate,               so               it               is               a               perfect               way               to               teach               your               kids               money-sense               at               same               time.
               3.

Open               High               Interest               Kids               Accounts
               Some               Australian               banks               offer               excellent               interest               rates               for               kids               bank               accounts.

The               best               available               at               moment               is               10%,               although               there               are               many               restrictions               that               they               can               not               earn               over               $400               a               year               or               they               will               be               taxed               at               very               high               margin               rate.
               Still,               saving               $400               a               year               means               you               can               save               $4,000               over               10               years               simply               by               parking               your               money               there               doing               nothing.

To               make               this               work               more               effectively,               is               to               link               the               accounts               to               your               online               high               interest               savings               account               which               are               paying               around               6%               per               annum               at               moment,               so               you               can               accumulate               interest               both               ways.
               4.

Buy               Index               Funds               Regularly
               Index               funds               are               very               suitable               tools               for               savings               as               they               are               highly               diversified               by               its               nature.

Index               funds               perform               almost               exactly               to               the               sharemarket               index,               and               as               the               result,               it               is               low-cost,               low-maintenance               funds               to               invest,               the               low-cost               feature               makes               a               lot               of               difference               over               a               long               term.

Index               funds               are               also               easy               to               invest,               you               do               not               need               to               worry               about               picking               the               fund               manager               or               the               portfolio.
               5.

Research               into               different               types               of               scholarships
               Scholarships               are               available               at               various               universities,               more               so               for               universities               in               USA,               Europe               and               also               some               parts               of               Asia.

While               it               is               not               as               common               in               Australia,               there               is               still               a               funding               available.
               The               system               works               quite               differently               in               US               and               Europe;               scholarships               are               funded               by               Government,               large               corporations,               alumni               and               foundations.

For               example,               Bill               Gates,               Al               Gore,               Steve               Jobs               all               have               their               foundations               providing               funding               for               scholarships               for               their               universities.
               Scholarships               come               in               different               ways:               1)               Academic               2)               Sports               Achievements               3)               Music,               Arts,               talent               4)               Innovations               and               5)               High               achievers               which               is               subject               to               judgment               by               the               foundations               and               universities.
               6.

ETF               Funds
               I               use               a               lot               of               ETF               Funds               for               my               children's               college               funds;               I               like               them               for               3               reasons:               1)               Easy               to               invest,               as               they               are               just               like               shares,               2)               Liquidity,               I               can               buy               and               sell               them               within               20               seconds               unlike               the               mutual               funds               and               3)               Choice,               there               is               a               wide               range               of               choice               of               ETFs               to               choose               from,               which               I               can               build               them               up               over               time.
               7.

High               Dividend               Stocks
               For               long               term               savings,               dividends               will               have               a               more               influential               role.

As               I               had               illustrated               before,               imagine               a               portfolio               that               generates               4%               dividend               yield               a               year               on               average               and               grows               a               modest               5%               a               year,               that               equates               to               9%               return               a               year               already,               plus               many               companies               also               increase               their               dividend               by               around               5%               to               10%               each               year,               and               this               can               make               a               lot               of               difference               after               10               years.
               8.

Save               all               your               pocket               money
               Most               families               have               a               lot               of               coins               and               changes               sitting               around.

We               did               a               study               in               2010               and               found               that               on               average,               there               will               be               around               $100               changes               sitting               in               the               household               at               any               given               time.

This               is               a               complete               waste               of               money               and               opportunity               as               you               can               use               them               and               earn               interest               or               invest               them               into               mutual               funds.

We               started               our               first               college               fund               like               this               way               and               simply               deposit               our               changes               at               the               end               of               each               month,               this               has               grown               to               $1,600               already               just               after               7               months.
               9.

Considering               studying               abroad
               Why               staying               in               Australia?

There               is               no               reason               why               your               kids               should               study               in               Australia.

There               are               many               countries               in               the               world               which               actually               offer               university               at               much               more               affordable               tuition               fee.

Many               European               universities               are               actually               free               apart               from               registration               fees;               some               universities               in               Asia               are               also               relatively               cheap               to               attend               --               look               at               different               choices               and               you               maybe               surprised.
               10.

Discipline               is               everything
               As               you               can               see,               mutual               funds,               dividend               paying               companies,               index               funds               --               these               are               really               just               the               tools.

The               most               important               thing               is               discipline,               and               the               best               way               to               achieve               that               is               "Forced               Saving".
               Every               family               has               ups               and               downs               every               month,               but               this               should               not               disrupt               your               savings               plans.

A               good               way               is               to               set               up               direct               payment               to               the               funds               each               month,               so               that               you               allocate               certain               amount               of               funds               from               your               bank               account.
               I               have               seen               many               of               my               friends               now               in               the               mid-30s               and               still               need               to               pay               off               their               college               debt,               it               also               caused               subsequent               consequences               such               as               delaying               their               ability               to               buy               their               first               home.

Debt               is               a               real               problem               faced               by               this               generation               and               you               can               imagine               it               will               be               an               even               worse               problem               for               the               next               generation.
               Do               whatever               you               can               for               your               children               to               save               for               their               college,               even               $5000               can               make               a               lot               of               difference               for               their               future.






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