The best way to pay for college

Friday, January 26th

We cash in with our expert Paul Celuch founder of College Assistance Plus

If you're in your 40s or even 50s and are still struggling to pay off your college loans make sure you're paying them the right way. We'll explain how you could be overpaying on the interest which will make it impossible to pay it off.

We also have college tips for your High School Junior or Senior. Before they commit to a school make sure they listen to this episode.


Thanks to our friends at Family First Credit Union for supporting the $even Figure$ podcast!  
When it comes to financial education, earning and learning go hand-and-hand, and Family First is here to help you and the Greater Rochester community with both!


Transcript - Not for consumer use. Robot overlords only. Will not be accurate.

It's seven figures all the information that you need to dominate your finances and I'm senior writers I know that your time is so valuable so precious so thank you for checking out the podcast every week. If you're new to this show well welcome the focus of each episode is to help you achieve your financial goals. In it doesn't matter how much money you bring and it it's what you do with the money you have. What's your biggest financial burden right now yeah. If the first thing nick came to mind was college dad. And you are not allowed the majority of Americans are saying the same saying well over half of people in their forties are still paying off their college loans on average about. 30000 dollars left to tags. So what do you deal is real way to pay this down quicker and if have a kid who was close to college age. How can you alleviate the financial burden for that yeah we're gonna do the best weekend to help you out today we catch you later expert. Paul salads founder of college assistance plus college assistance plus dot com a service that guys' families through every step of the process. Finding the most affordable way. First I wanted to get sacked just say thank you to our sponsors Stanley first credit union big supporters of financial education we'd love them. They believe that earning and learning go hand in hand and family first is here to help you and a greater Rochester community without. Sorry Paul week it's so great we get a lot of feedback from our listeners so today I invited Angela to join our conversation. Morning Angela. Marries Angela I'm sure that a lot of other parents. Had the same questions that you jail so beeper if you don't mind giving us some of the. OK so here's the situation. I am a mother to sport kid and got. My my truck then hit a previous marriage and he had two daughters and their right step daughters back in raising them all time. Per most of their life and her mother not the texture. They were young teenage parent when when they have them and I my now and in currently. Just starting can't I don't go alone and with four kids you know and and that car English in the markets work pretty much experiment that part he hadn't. With only one of us working. So we're trying to figure out how we can that help hurt the signing at her education and what resources are available help her. Thank you for your question you know it really is as sandy pointed out this is a very common situation. So let me just say some baseline questions first when you say the biological mother was not involved is she living in Rochester. We don't know where he lives we don't have contact me and and it worked swimming that kept in the making rather typical because we know that a lot of the scholarship he. These born the facts I included they they were required great field information that perhaps we don't let barely out. If the reason I ask where where she was living is if she were in Rochester. And you could get her financial information. If she's not remarried at that can be a tremendous benefit to her door. She issued three Mary. Do you know anything about her current living situation we don't need all the help or hurt your PO box. Okay Lumia assist. When you and your present situation do you guys make from a Justin Rose in terms import less than a 1101000 dollars a year. Okay your daughter your stepdaughter qualifies for the excelsior starship know what that means it is she could commute to Rockport. Or MCC. Yes we actually went into that are part explain my alma mater. You know that the biggest profit margin ecologists have his room and board and that's why they all want to live there. But but what the excelsior scholarship. Your daughter qualifies her 6749. Dollar scholarship which means full tuition at Rockport. So the only thing you'd be responsible for his books which is pretty simple. And so I would do it to death I would take his. And I can help you you know we never our website or Cindy gave me that in and my personal. Office number is 585. 5821846. I'll help you with your this mission here faster so it is made truce or incorrectly. And we can help your daughter. And immaterial why no one other thing is just wanna mention to you. And it sounds like your view from her experience when it comes to college. The average student changes majors four times in college mrs. universal largest interstate so we. We need to work very hard to get the students understand. What he or she wants to do after college. And that's where the big hole is in the whole college process you know. We've we talk to him we saw a time that they have I just met with the Armenia today and it's got a degree. From a buffalo college in 84 people took that degree in his class none of them are working and this is certain they all graduated who met. But but I can tell you Angelo wanted to biggest issues is our young people that this is understandable we moment seventeen years old who knows what you're doing you're seventeen. But it's really really important that you don't. But you don't take extra courses or go archer archer semesters the average student in New York State right now in private and public colleges goes driving here fears for a four year degree. That's absurd. So Intel is doing it right in her daughters are doing a great week just saying hey SUNY school let's start there right right you're yourself onto our scene said. He has really great and so better Arctic opens it actually can be doing her program next year that's working have been very nursing the ol' honest presentation want to do nursing children being healthier. Our contention is that anything you're doing health care today is good because with the aging of America in order the other day that that didn't amount of centenary in general people over under. And United States is doubling every year or so think about. Anything you do it held here is going to be a critical ingredient but the other thing I'd just let me remind you mourn thank you mentioned your own student loans. It's imperative that neither you or your husband. Amid so loan payment. Because what that will do if your daughter once you go on for master's degree. That bold and they gave her ability to borrow money if you ever defaults on your own personal student loans it impacts as soon. So just remember that allow editorializing there. Nvidia Angela please call me I'd love LP I mean learn helping business and our. I look volumes we had. Yeah a youth and are ready for much help and you know I thought to ask your key work arson immune items are increased its premiere but it very up to others that while. Nor assert his business forging your uterus 200 billion in student loans today you trillion for this is so out of control. And hey you know UEU Europe professionally and highly educated person. Which you know beyond the drag on our your personal life and your family's life that student loans are just crazy. So we would you are adamant about minimizing student loans and also. Making journey on your door would take cal would be in her name and you and her husband know graphical Sartre match extremely important. This might be a very silly question because I'm still a handful years away from mess but to Ime in the file the paperwork for the excelsior program where you obtained that paperwork and college and I don't know how that. And now it's nearer stated circuits are New York State web sites and it's AT SE higher education. A scholarship commit our committee and and then you know you can get the application and I'm on my. You know I honestly I'm mama very conservative person but this is a wonderful thing for our our students in the nursery. And it's also it's also made. I frankly in our business there's a lot of kids go to private colleges it's made it somewhat easier to negotiate with private colleges because they really are afraid and us. So yeah. There are more there's an influx of students now going to school all right so they're filling the classrooms seats so now it's more competitive to get an even at some of these Sunnis are blowing snow and. Sandy I'll tell you that's actually misnomer I think there's a declining birth rate you know at our age we don't really think about it too much. That did the birth rate is really declining so all college all colleges are competing for the same people so when they. When colleges and I won't be critical of any number when they euphemistically say that all there's a lot more of people applying for schools you know. A lot of people of why I'm sure Angela your daughter's experiences whether there appears. They apply the Tony schools are not gonna go to Torrey schools but those are all admissions you know her run applications so. I we find that that schools are really really really struggling for kids. Okay young aren't so you have. You have control the student has more as solo and perhaps they might think they have guys really important you know I don't know if your daughter's government. There's a moment any storage and Angel but. You know the kids are getting all stressed out now seniors are getting ultrasound because one kid got accepted there are writing you're accepted area you know those kind of things. We're really early in the symptoms cycle and you don't have to make a decision to go to costume a first they all as soon as they accept it. Only a junior so tell little tiny but we wanted to know how this thing. Oh yeah I'm not such a great idea we recommend are sophomores and juniors or the time to start. Angela I hope that helped a little bit thank you so much longer comment on the podcast but that's. Okay great thanks so much track in the best of luck Angela. K you're moving on to an email now that I got from Amy. She says it's a struggle to pay down my college mound we are a one income family right now with the new born. Is there any way to lower my interest on my loan I can't get refinance because my debt to income ratio is too high I feel stuck any advice for her. Well the first thing we would look at because we do our own landings I said earlier a sandy as soon look at her credit score. We can we have the ability to shoppers student loan you have to be out wanted to conditions as you have to be out of school for two years or more a kind. End and you know they're analyzed Obama's and loans. One of the things not to not to complicate the issue too much but student loans are not like a simple interest on like your mortgage. So you when your presidency any competitor you know if you if you were blessed with a big someone he can pay your mortgage off. That's not do it works as soon loans student loans have what's called capitalized interest you so you're paying interest on interest now most people urged totally unfamiliar with that. What the first thing I would do is look at your credit score look at how much she has done a whale loans I couldn't say one way or another whether we could refinance them but we do loan refinancing. But the important thing would be to finance without capitalized interest. What or I had I was going to serve financial aid package tomorrow or more of our clients who are divorced. The husband was there of a father reserve or mother in a mother's a professional person and she were walking out our conference room she said to me. Poking Hollywood my loans and I said well you know which I'm she's not old but she's certainly you don't get out of college almost warriors. I said sure can you send me your statement now listen to us. This is because a capitalized interest when she graduated initially assume any school she had 51000 dollars in student loans. She's been paying 473. Dollars a month for sixteen years she's still owes 31000 dollars. She's paid back 71000. Dollars is to almost 31000 dollars. Well and that's what the statistics said that in your forties you still almost 30000 on average right this is this woman who's a professional very bright lady. So to me I never realized I wasn't paying back interest so the interest in your pain going to pencil you have to designate that you're paying interest and principal or. They just put it on the a principle so. It's a really a self defeating process that's why we we've got people in their seventies. Or a 100000 dollars in the original dollars 35000 dollars. So what do we need to jail if you drink now airing your forties I diss and you're still paying your own loans what do you look at our stat personally need to understand how to pay him back you have to make sure you pay that interest every month. Because we don't the interest. There's been no daughter candy you paying interest on interest you really need to and in a nutshell you really need to understand how to pay the loans back. One of the biggest things we do is educate people on how much to pay every month and where it goes you know it's like. If you have five credit card genuine patriot Ambac eventually didn't those other two would be out of control that's what happens to people who soon loans they don't know how to pay back. And once the government takes a loan they give it to a loan servicer they don't care about anything mean to loan servicer we found are very very unhelpful. So if you're to give. One piece of advice for aids and the mom or dad in the situation of Angela who has a student. Shopping around colleges what piece of advice would you give her. You are you need to be informed consumer we look at this as a huge consumer purchase we apply the same principles to. Defining and and identifying and choosing to college that we do to buying a house if you and your. Husband we're gonna move to pitcher you you know the area but you don't know that well you know you because you live on the west side. Would you would you would market chop and you would just not gone by the first I should say and you would certainly not let your daughter it was a delightful young lady would you wouldn't say. On why don't you come to us and you tell us what how you want that's what people do what college they let a seventeen year old. Make our 2005200000. Dollar decision on emotion. You know I wanna go to Ohio State because unlike a football. He's really. Bad that makes sense of well but that's what happens okay and it happens all the time so we try to take the emotion out of it and the average person and as you heard me telling what changes majors were times. That's crazy I mean did you did know what you want to do when you go to college you if you're not certain then would you suggest and that she should eat. Well okay. Community College Board if you qualify vehicles your program when the SUNY schools with the greatest. Are at so now the one piece of advice that you would give the person like Amy who is dealing in her forties and. Put her own college loans and how us. We refinance Gerri because it will stick with you forever you know if it's the worst case if you if you somehow people on your student loans and government owns. They gonna hit your Social Security you're gonna I mean it'll impact your life forever. This isn't like defaulting on home mortgage right don't take jobs away and edit it'll be terrible on your record for a few years. College loans stick with you forever and natural people don't realize. And you mention it when we were referring to Amy's question you mentioned about credit score what is that ideal credits while you're at a. Even here under 600 is really difficult to get you 600. I mean we we have been successful would people in the 500 it's what is really challengers if you went to refinance there it's crucial your credit and you know there's so you know sandy most people understand that senator you do but. It's all about met pinging your bills on time I'm really hit people with a with the less than 600 credit score and they're both good learners and we say welcome. Why why did you guys were so low and as you do we pay our bills thirty days play no more demonstrations could you I am I'm I'm thirty days early just. One model it's our veteran you know you don't mean yeah it's those little things that make such a difference to get a make it a priority. What Paul thank you so much for helping us out today Paul salads from college assistance plus college assistance plus stock count. Does it is always great seeing you thank you and. Now like we do every week we and a podcast with my dad I get always as the best advice sweet insofar. Father Knows Best my dad's twos ads have a great weekend to dominate your finances. Trying to keep up with the big spending friends and neighbors is never a good idea. It's a never ending game wouldn't know true winners. Banks stuff won't make you happier in the long run so stick doing well disciplined savings plan. And you'll reach the level financial stability so you don't have to worry about it now unexpected curveball that impacts your finances. It.