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collectors must stop contacting you if you ask them in writing. Students should indicate that they must contact the credit bureau and their creditor via certified mail with copies of documents that show why your report is in error.
information to determine whether the student needs to provide the parental information in Step 4. Step 4: This section seeks the student’s parents’ basic personal information including name, address, marital status, income, taxes, costs of housing, employment status etc. Step 5: This section is to be completed by the student if the student answered yes to any question in Step 3. Step 6. This section seeks the names and federal school codes of the colleges the student wants to receive the FAFSA information (SAR) Step 7: This section seeks the parent and student’s signature and certification that the financial aid will be used toward education and that the information provided is true.
19. Students should indicate that the interest rate is not the total cost of the loan. The total cost of the loan is indicated by the APR which includes fees and other charges. 20. A Sweet Savings Solutions! To create an emergency savings fund; to save for short term financial goals. Liquidity is the ability to quickly convert something to cash. Most financial emergencies are time-sensitive, so liquidity is essential for dealing with immediate cash needs. Many experts believe that the decline in savings can be blamed on a consumption boom — overspending for consumer purchases and paying with a credit card, which leaves little money left for savings. Acceptable answers indicate that necessary expenses should be included in the account: rent & utilities, car & insurance, groceries, student loan and credit card payments, and some smaller allowance for personal and entertainment expenses. She should try to keep up her IRA deposits! In lean times she can probably do without restaurant meals, Zumba, prepared meal delivery, GNO, clothes shopping, daily lattes, and carwash/ detail. She can reduce the amount she spends on hair and nails, and select Hulu, Netflix or Amazon Prime - but not all three. As a freelancer she should have about six months worth of living expenses saved... so about $1765-2000 month x 6 (Savings = between $5,295 and $12,000) Job security, freelancing, dependents including children and possibly elderly parents, additional debt, life style changes, comfort level... About 1-5 years and under $5000; Vacation savings, holiday gift accounts, car down payments, appliance purchases. Over 5 years; house down payment, college tuition for kids, starting a business, retirement, travel, net worth goal. They increase your incentive to save and invest, which increases your likelihood of successfully meeting your financial goals. No. 10. $1250 11. $1276 12. The time it will take to double your money at 1. 2. 6. 7. 8. 9.
9.
10. Students should indicate that credit gardening is a technique that involves
setting goals for credit score improvement, refraining from opening new credit lines and saving money to make payments, over a set timeline to achieve a higher credit score.
Fun with the FAFSA
1. 2.
Are You Financially Literate? Chapter 7 Quiz PRODUCT PREVIEW 1. 2. 3. 4. 5. 6. 7. T A B A D D FICO is the credit bureau; FICA is the federal law establishing Medicaid and Social Security. Students should indicate that Jessica should make on-time payments on her student loan for a period of time in order to build a good credit history; she can also apply for and make regular payments on a secured credit card. She can get a car loan, which is not too hard to get without a credit history. 8. 3. 4. 5.
The current FAFSA has over 100 steps, questions or items that the student and/or their parent(s) must complete.
3. 4. 5.
Jan. 1
June 30
For state or college aid, the deadline may be as early as January. File as early as possible. If you (or your parents) need to file an income tax return with the IRS and have not done so, you can submit your FAFSA now using estimated tax information, and then must correct that information after you file your return. The questions on the FAFSA are required to calculate your Expected Family Contribution (EFC) which measures your family’s financial strength to determine your eligibility for federal student aid. Your state and the colleges you list may also use some of your responses. They will determine if you may be eligible for school or state aid, in addition to federal aid. The EFC is the Expected Family Contribution. It will be listed on your Student Aid Report (SAR). Colleges use your EFC to prepare a financial aid package to help you meet your financial need. Financial need is the difference between the cost of attendance and your EFC. 10. Step 1: This section seeks the student’s basic personal information, including name, address, social security number, basic education history and future plan. Step 2: This section seeks the student’s tax and earning information. Step 3: This section seeks the student’s 9. 6. 7. 8. IRS Data Retrieval tool
9. B 10. C 11. D 12. T 13. D 14. A 15. D 16. D 17. B 18. F
375 THE 21st CENTURY STUDENT’S GUIDE TO FINANCIAL LITERACY
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