New rules that college-bound seniors should be aware of. From Dept. of Education:
The U.S. Department of Education (ED) is cracking down on school-bank partnerships that unfairly target college students receiving federal student aid. Last Friday, ED announced proposed regulations that would ensure students aren’t required to receive their federal student aid on prepaid or debit cards that charge fees for overdrawing the accounts.
Why is this important? Continue reading
This chart goes well with an earlier post about how interest rates impact the economy. The Federal Reserve announced today that they will be ending their Quantitative Easing program(technical term for the Federal Reserve keeping interest rates low by purchasing bonds) after almost five years of intervention. One major beneficiary of this policy: the stock market!
A few ideas to engage your students: Continue reading
Another Question of the Day!
I have been waiting for a resource like this to demonstrate to students how lifetime earnings can vary significantly based on the major they select in college. In other words, not all college degrees are created equally. The Hamilton Project is out with a database showing lifetime earnings for 80 college majors. They have an excellent interactive tool that allows students to select various majors (and types of degrees) and compare lifetime earnings for each of them. It might be fun to have students select 3-4 majors they think they might be interested in and compare the potential outcomes. This will lead to interesting conversations about whether students should follow the money (choose majors with high earning potential) or their passion (career they love but pays less).
Here’s the chart showing lifetime earnings by major (that’s millions of 2014 dollars on the top axis):
Banks use credit scores to predict whether you will pay back that loan, baseball teams use advanced analytics to determine whether a player is worth that mega-millions contract, Google and Facebook use algorithms to predict what ads you might click on. This got me thinking about student debt and the conundrum that students face in their ability to predict the future; especially will they graduate (which will improve their earning ability) and find a good-paying job. With all the talk of Big Data, I thought someone must have tried to solve this problem. I remember student lenders touted their ability to do this back in the boom days of 2006-07, unfortunately they didn’t survive long enough due to to see if their predictions were accurate.
This article from VOX caught my attention as it showed how Big Data is coming to colleges looking to bolster their graduation rates (less than 6 in 10 students who enroll as freshman graduate within 6 years as this chart below indicates): Continue reading
Looking for a way to bring the Federal Reserve to life? Ok, I admit this can be a dry topic to tackle while also being a very difficult one to explain to high school students or anyone for that matter. So, when a teacher sent me a note today asking if I had some good resources about the Federal Reserve aside from the Fed websites, I put on my researcher’s hat and spent a few hours looking. My goal: to find a novel approach to this topic that could help supplement an educator’s existing lesson on the Fed.
As serendipity would have it, in the midst of my research I received an email alert about the Fed Chair Janet Yellen’s press conference today following the 2 day meeting of the Federal Open Market Committee (FOMC). For those familiar with these sorts of things, watching paint dry can seem a more exciting alternative. Ok, but when you consider that markets hang on every word from the Fed Chair’s mouth, it forces one to sit up and take notice.
So, how might I structure a supplement to your Federal Reserve lesson? Continue reading
I am often asked how something like internships or careers fit into a personal finance curriculum. My answer is: It should be at the heart of it. One of the keys to financial success is finding a vocation or career that you love and provide you with a level of remuneration to live the lifestyle you desire while saving for the future. Teaching at a high school that serves its first generation students through college and career (through counseling and internship training/placement), I have seen the power of internships in helping students make the connection work and school and increase their motivational level. What is particularly gratifying is seeing students use their internships to obtain full-time employment after college too. NGPF is currently working on a series of lessons to assist students in this process and we hope to release by late October.
I wanted to point readers to a number of articles that basically say the same thing: In a challenging employment environment for young college graduates, internships are more important than ever! From the Atlantic: Continue reading
Want to explain to your students about the dangers of payday lending? This is not a bad place to start. This process flow is taken directly from ACE’s training manual (recently fined $10 million by CFPB) and demonstrates the cycle of misfortune that comes from payday lending: Continue reading