LESSONS THAT LAST A LIFETIME THINK BEFORE YOU SINK College 101: In state or out? SIGN ON THE DOTTED LINE Many publicly funded colleges and universities offer lower tuition to students who live “in state” and graduated from local high schools. It pays to be smart with money Only spend on what you really need Attending a public school across the country from home means But only if you read the contract first By following some simple rules when it comes to spending, saving, One of the best ways to keep money in your pocket is to have a plan for how you will be charged a higher, out-of-state tuition rate not discounted The sticker price shown in ads typically does not include ongoing ownership borrowing and planning for your money, it’ll be easy to have cash on to spend it. with taxpayer dollars. costs such as car insurance premiums, maintenance costs, fees for borrowing hand when you need it—no matter how old you are or how much money (also known as interest payments) or fees for late payments. money you make. A lot of the time, you’ll find that the true “costs” of ownership just aren’t worth Compare the in-state cost for one year at Washington’s public the price. universities against out-of-state costs in neighboring states: Always take the time to calculate the true cost of ownership before you commit to buying. Goals for managing your money Did you know? Here’s what you can do now to make sure there will be money in your wallet Goals for saving money 60 percent of Americans say they do not have when you need it: 4 Don’t pay more than you really need to. Always have a plan before you buy. even $500 in savings to cover an emergency.1 UNIVERSITY OF OREGON — EUGENE, OR Tuition and fees = $33,442 Check your budget Read contracts — know what you’re on the hook for and avoid Review your monthly budget and find the money before you buy. Books and supplies = $1,122 $48,496 Living costs = $13,932 surprise charges. Do your homework Cost of attendance = $48,496 Save up — Have several months’ worth of payments saved before Explore all options; there might be a better or less costly alternative. borrowing money. Set goals UNIVERSITY OF IDAHO — MOSCOW, ID3 Put down — Pay as much as you can with cash, rather than paying Have a plan for how you’ll spend your money in 100 percent with credit. You’ll save money in the long run by paying the next few years, as well as the next few months. Tuition and fees = $22,040 Books and supplies = $1,214 $35,448 less in borrowing fees. Expect the unexpected Living costs = $12,194 Money made easy Don’t wait until you’re out of cash. Have a plan Cost of attendance = $35,448 Get rich quick! Money-saving tips Rules of thumb for managing to handle surprise expenses. Putting aside even just a few dollars each month will make your bank your money: account grow. UNIVERSITY OF WASHINGTON — , WA Spend wisely Tuition and fees = $10,753 Which of these money-savers have you tried? • Spend less than you earn Books and supplies = $825 $29,764 • Pay bills on time and in full Do I have the money for this? Living costs = $18,186 “Set it and forget it” with automatic monthly transfers from checking to savings Is there a cheaper option? Cost of attendance = $29,764 Borrow from the library instead of buying from a store Save often Will I have to make monthly payments? • Always have cash savings on hand Where will I get the money for this? Open a short-term CD to save and earn interest • Invest money to make money Do I need to borrow it? WASHINGTON STATE UNIVERSITY — PULLMAN, WA2 Sponsored Newspapers In Education Content Tuition and fees = $11,041 Shop used items instead of new Books and supplies = $960 Borrow carefully $26,899 Put cash gifts into a separate • Borrow only what you can Living costs = $14,898 afford to pay back Cost of attendance = $26,899 Take advantage of student discounts IN REAL • Maintain a healthy credit score LIFE Avoid sticker shock Plan ahead Don’t be shocked by the total price tag when you make a big purchase. • Plan ahead for big expenses Here’s a sample breakdown of what you can expect to pay for common • Get insurance to protect yourself life expenses.

• Buy an older model phone Down payment First month’s Late fees $25 Monthly $1,000 Pet Fee parking fee $100 IN REAL • Join a family plan Surcharges repayments Room and board Tuition $200 LIFE Phone loan (60 months Sales tax $13,080 Credit Check $35 • Carpool with friends and other and fees Cleaning Sponsored Newspapers In Education Content In Education Newspapers Sponsored payment @ $191.22) $800

fees $20 $4,979 |

6 Fee $150 • Join a car sharing group $40 $11,473.20 SUNDAY, APRIL 22, 2018 Did you know? Government Security Cheap thrills • Use a ride sharing service fees and Deposit “Sticker shock” is a condition that comes from seeing the true price of $500 You can still have fun Take advantage of in-state taxes $20 One year • an item and realizing the damage is much worse than you thought.5 Monthly cell Renting an even if you don’t have tuition phone bil Buying a car of college apartment a lot of dough. There $13,273.20 Transfer credits to your dream $215 $12,713 $4,279 are many ways to get •  school 1http://money.cnn.com/2017/01/12/pf/americans-lack-of-savings/index.html, 2www.collegetuitioncompare.com/compare/tables/?state=W what you want without A°ree=Undergraduate&type=Public, 3www.collegetuitioncompare.com/compare/tables/?state=WA°ree=Undergraduate&type=Publ Live with roommates ic, 4www.collegetuitioncompare.com/compare/tables/?state=OR&city=Eugene°ree=Undergraduate, 5www.urbandictionary.com/define. spending tons of cash— • php?term=sticker%20shock, 6www.howtogeek.com/228902/the-iphone-6s-is-almost-here-time-to-lease-or-buy/, 7https://arstechnica. Books and 8 if you get creative. com/information-technology/2014/01/verizon-leads-top-wireless-carriers-in-bill-size-at-148-a-month/, www.collegetuitioncompare.com/ supplies $989 Last Month’s • Choose a lower-cost area state/?state=WA, 9https://trends.collegeboard.org/student-aid/figures-tables/state-grant-aid-undergraduate-student-2015-16 ($1340 in state aid grants), 10www.collegefactual.com/colleges/washington-state-university/paying-for-college/financial-aid/ (59% of students received $4955 Data overage Cell service Rent $1,647

SUNDAY, APRIL 22, 2018 | APRIL 22, 2018 SUNDAY, Total borrowing fees $2,473.40* 11 in avg scholarships at WSU), www.seattletimes.com/business/real-estate/seattle-area-rents-drop-significantly-for-first-time-this-decade-as- fee $1007 First Month’s Rent $1,647 fees $10 *Interest paid on the amount borrowed is part of the monthly

new-apartments-sit-empty/ With grants and scholarships $6,335 3 payment amount 2 GO WITH THE (CASH) FLOW LIVE THE GOOD LIFE IN REAL LIFE BALANCE SPENDING WITH SAVING BUILD A CREDIT HISTORY WORTH REMEMBERING A tale of two credit histories Compare what you’ll pay up front if you have good credit against what A healthy budget saves more than it spends. Make it a habit to review Don’t have enough cash on hand for all the things you want or need to buy? You are not alone. Many financial institutions, you’ll need to pay if you have a poor credit history or none at all. your bank account and balances at least once per month. credit card companies and retailers loan customers money “on credit” to make big purchases. When you pay with credit, Sign up for or download your bank or ’s you borrow money from someone else and promise to pay it back in small amounts over time. mobile app to stay on track with your accounts quickly and easily. Each time you buy with credit you build up your personal credit history and reputation as a borrower. Companies look at Goals for spending your money your credit history to decide how likely you are to pay back a loan. People with “good” credit have a track record of Don’t get caught with an empty wallet during a crisis. paying their bills every month. Here’s how to keep from running out of money when you need it the most:13 Bad credit: A bad reputation No credit: Starting from scratch Making late payments or forgetting to pay bills will affect If you avoid using credit, you won’t have any debt to pay Cell phone Private student loan your credit history and give you a poor credit rating. back, but you also won’t have a borrowing history 1. Pay no more than 50 percent of your monthly income toward ($1,000 – $2,000) ($25,000) basic needs such as food, transportation and housing. • Can’t borrow money to show lenders. 20 2. A im to save 20 percent of your monthly income for emergencies, • Pay more to buy a car • Can only spend what you save Good credit Good credit repaying debt or saving up for your future goal of buying a car. • $0 down payment • 8% borrowing fee • Pay more to rent an apartment16 • More requirements when borrowing money 3. S pend up to 30 percent of your budget • $83 monthly payment • 30 years to repay • High borrowing fees • Larger upfront payments required on fun stuff like eating out, for 12 months • Lower chance of identity theft • $183 monthly payment entertainment and travel. • High insurance costs • $41,039 paid in total fees Bad/no credit • $500 down payment for phone18 Bad/no credit • $41.66 monthly payment for • 15% borrowing fee AMOUNT 12 months Goals for building credit • 25 years to repay • $500 deposit to activate 1. Start small Savings (Income x .20) $ cell service • $320 monthly payments Know your flow: You don’t need a ton of credit cards to build your • $71,062 paid in total fees Monthly cash Student Loan Payment $ credit. Pick one bill a month to pay with plastic and 19 flow worksheet pay it off each month. Auto loan ($10,000) Sponsored Newspapers In Education Content Rent $ Apartment rental Use the worksheet to the right to figure 2. View your credit report yearly Good credit out where your money is going each Utilities $ Look for any mistakes and ask the credit reporting • 5% borrowing fee Good credit agency to fix them. • Lease easily approved month. Add up your monthly bills and Auto Loan $ • 5 years to repay subtract that from the total amount of • $189 monthly payment • $250 security deposit 3. Use caution with store cards money you bring in each month. Auto Insurance $ • $1,323 paid in total fees • 2 months’ rent required at move Store-brand credit cards often come with higher in (first and last) Gas $ than average interest rates.17 If you are budgeting well and spending • Proof of 3 months’ rent in less than you earn, your total monthly Food $ Bad/no credit savings required • 18% borrowing fee income should be greater than your 12https://nfcc.org/wp-content/ Clothing $ uploads/2017/05/2017-FLS-Infographic.pdf, total monthly expenses. 13Seattle Times 2017 NIE insert – “How to be a • 3 years to repay Financially Stable Adult” pg. 4, 14www.experian. Bad/no credit Phone $ com/blogs/ask-experian/credit-education/ • $362 monthly payment score-basics/what-is-a-good-credit-score/, • Lease application denied or 15“Credit score distribution by age.”www.val- • $3,015 paid in total fees Credit cards and other debt $ uepenguin.com/average-credit-score, 16www. requires a co-signer Sponsored Newspapers In Education Content In Education Newspapers Sponsored mint.com/money-management-2/6-damag- | SUNDAY, APRIL 22, 2018 ing-side-effects-of-having-a-bad-credit-score, • $500 security deposit Entertainment $ 17www.usatoday.com/story/money/personal- finance/2016/11/01/store-credit-card-highest- • 3 months’ rent required at interest-rates/92431750/, 18www.creditcards. Total Monthly Expenses $ com/credit-card-news/cellphone-credit- move in check-1270.php, 19www.igrad.com/calculators/ what-would-my-loan-payments-be, 20www. • Proof of 6 months’ rent in igrad.com/calculators/what-would-my-loan- SUMMARY payments-be savings required

Total Monthly Income $

Total Monthly Expenses $ — SUNDAY, APRIL 22, 2018 | APRIL 22, 2018 SUNDAY,

Monthly Cash Flow $ = 5 4 IN REAL GO FOR THE BIG SCORE THE BUCK STOPS WITH YOU KNOW YOUR DEBT LIMIT LIFE Push through the pain of debt Grading your credit report Paying for big-ticket purchases with credit is a smart financial move if you are Who’s paying your bills? Don’t take on more than you can handle already planning ahead, saving often, borrowing carefully and spending your money To make viewing your credit history easy, your personal It’s easy to shop online and forget you’re spending real money. Borrowing more than you can afford to pay back each wisely. Here’s how the cool kids are using credit without breaking the bank: financial data is collected and summarized in a single Credit card companies and other bill collectors will want their month often leads to late or missed payments. Many report. The information in your credit report is graded money back whether you can afford to pay them or not. companies charge penalty fees if you miss a payment using a mathematical formula and given a numbered deadline. If these fees pile up, along with bigger-than- score. Credit scores can range from 300–850. normal monthly bills, you could end up in a downward Make all auto loan payments on time and in full. If you don’t, your lender may take 28 Here’s what could happen if you don’t spiral of owing more than you earn. away your car — but not your loan payments. Your credit score is based on: 24 pay your monthly bills on time or in full: Measure whether you are borrowing too much Complete the FAFSA (Free Application for Federal Student Aid) at fafsa.ed.gov to by calculating your pain-to-gain ratio, also estimate college expenses and government aid. 10% • Charged a late payment fee • Lower credit score Now credit 35% known as your debt-to-income ratio. Compare Payment • Lose rewards points • Reported to collections agency the amount of money you owe (pain) to how Consolidate student upon graduation to lock-in lower borrowing fees. 10% history • Lose service • Car repossessed much you earn (gain). Keep your “pain” to less Credit mix If you can’t afford the rent without a credit card, you can’t afford to live there. • Borrowing fees go up • Loss of home (eviction) than 36 percent of your income and your wallet will thank you. • Appears on credit report Spend less than 28 percent of your monthly income on rental housing.30

15% Goals for paying bills The pain-to-gain calculator: Length 1. Pay bills on time and in full. What’s your number? of history Did you know? 30% 2. Make repaying borrowed money a priority. Use your answers from the Monthly Cash 56 percent of Washington state college students had debt upon graduation, Amounts owed Flow worksheet on page 4 to calculate 27 3. Pay back more than the minimum amount required with an average of $24,997 in loans. your level of pain-to-gain below: each month. IN REAL LIFE Did you know? You have the right to request one free copy of your credit report from each of Debit or credit? the three national reporting agencies (Equifax, Experian, and TransUnion) every Student Loan Payments $ 12 months.22 Tempted to buy a new TV or laptop using credit? Think beyond the sticker price and decide how much your budget can afford to spend + Auto Loan Payments $ Order your free copies from annualcreditreport.com on this each month and for how long. Monthly borrowing fees can + Credit Card & Other Debt $ really add up over time and add a lot of money to the total cost of Sponsored Newspapers In Education Content your purchase. Total Monthly Debt $ IN REAL LIFE Here’s what it really costs to pay off $2,000 at Total Monthly Debt $ Here’s looking at you, kid an 18% interest: ÷ Total Monthly Income $ Companies look at your credit report to decide if they want to lend you = x 100 = Pain-to-Gain Ratio % money and what fee they will charge for borrowing it. Potential employers, $50 per month making $100 per month making insurance agencies and rental property owners may also look at your the minimum payment more than the minimum credit report before choosing to work with you. Years to pay off loan = 5 Years payment Total interest paid = $1,000 Years to pay off loan = 2 Years Total amount paid = $3,000 Total interest paid = $40025 Here are some of the people who might be looking Total amount paid = $2,40026 Sponsored Newspapers In Education Content In Education Newspapers Sponsored

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at your credit report: If you choose to pay the minimum SUNDAY, APRIL 22, 2018 amount, you pay $600 more and • Cell phone retailers • Private student loan companies take an extra 36 months to pay • Cell service companies • Potential landlords back what you owe. • Car dealerships • Utility service companies • Banks and credit unions • Rental insurance providers • Car insurance companies

27www.seattletimes.com/education-lab/washington-state-ranks-40th-in-average-college-debt-per-student/, 28http://www.autos.com/auto-loans/5-car-loan-pitfalls- 22www.usa.gov/credit-reports#item-35087, 23www.gobankingrates.com/credit/who-looks-credit-scores/, 24www.thebalance.com/the-consequences-of- 29 30

SUNDAY, APRIL 22, 2018 | APRIL 22, 2018 SUNDAY, to-avoid, money.usnews.com/money/personal-finance/articles/2014/06/03/a-guide-to-creating-your-ideal-household-budget, http://guides.wsj.com/personal- skipping-monthly-payments-960106, 25www.bankrate.com/calculators/credit-cards/credit-card-payoff-calculator.aspx,26 www.bankrate.com/calculators/

finance/buying-a-home/how-much-you-should-spend-on-a-home/

savings/loan-interest-calculator.aspx 7 6 THE NEXT THE BIG TALK: MONEY TALK

Having the “money” talk with your teen is as important as speaking to them about any other life challenges. A healthy relationship with money starts at an early age.

THE FOUR BUILDING BLOCKS TO FINANCIAL HEALTH

COOK UP A BUDGET PARENT: Ask your teen to choose a dinner recipe to feed the entire family. Give them $20 to go to the grocery store to pick out ingredients. You can also encourage them to look for coupons ahead of time.

TEEN: Discuss the price of each item, add it up as you go and review the choices and trade-offs you make along the way. Spend For example, is there another brand on sale or available for a lower price? Can you swap out another ingredient for one that is less expensive?

A HEALTHY INTEREST IN INTEREST PARENT: Search for an “interest calculator” on the Internet with your teen and use it to show how small amounts of savings can add up over time. What will $100 be worth 10, 20, 30, 40, 50 years from now? Take a step further by researching CD (Certificate of Deposit) offerings with your financial institution or reference the CD calculator on BECU.org for more savings options.

TEEN: With the “save, share, spend” philosophy, you can set aside money specifically for spending, saving for the future and Save charity. Identify a community organization or non-profit that is close to your heart and consider giving regular donations, which can provide tax benefits in the future.

JUNK MAIL – FINALLY GOOD FOR SOMETHING PARENT: Collect all of the credit card offers that you receive in the mail and review them with your teen. Look for the interest rate. Is it promotional with an end date? Is there an annual fee? Discuss the grace period. Do they offer other perks?

TEEN: Compare the features and discuss the advantages and disadvantages of each offer. You can also play out purchase Borrow scenarios–like buying a laptop on credit. If you make the minimum payment, how long will it take to pay off the computer? What will the total cost be, given the interest accrued over time?

Sponsored Newspapers In Education Content In Education Newspapers Sponsored LIFESTYLES OF THE SMART & PRUDENT PARENT: Write down what you want to accomplish in the long-term—both personally and financially. Focus on your dream job and lifestyle. Where do you want to live?

TEEN: Together, research the requirements and average income for their dream job and compare it to the costs of their lifestyle, including groceries, rent or average home prices in their desired community. And if a family is part of the plan, Plan research average childcare costs. Support them in their goals and reinforce the important role that finances play. SUNDAY, APRIL 22, 2018 | APRIL 22, 2018 SUNDAY, becu.org/thenextbigtalk

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