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Author: Powercat Financial

Director of PFC

Why Young People Should Care About Disability Insurance Today!

You may be young, but you’re not invincible. According to the Social Security Administration, more than one in four 20-year-olds will become disabled prior to reaching retirement age. Yet, currently four in every ten workers do not have any disability insurance at all. Here are four reasons why you should not be in that statistic:

  1. Liquidity

Your health insurance may cover your medical bills but it will not put food on your table or gas in your car. Disability insurance helps you replace your lost income that you used for everyday living expenses. Most young people do not have very much in savings yet, since they just entered the workforce, and are living paycheck-to-paycheck. So really, you can’t afford NOT to have disability insurance!

  1. Workers Compensation Isn’t Enough

Even though you might have workers compensation insurance through your employer, less than half of all disabling conditions of young workers are workplace-related. That means that you are more likely to get a disabling condition that does not qualify for workers compensation insurance.

  1. Government Benefits Aren’t Much

Sure, the government will give you some bare-minimum disability benefits through Social Security…if you have been disabled for the last 12 months! If you can’t make it a year on your savings, you’re out of luck with government benefits. Short-term disability insurance could help you within weeks!

  1. It’s Not That Expensive

Disability insurance really is not all that expensive, especially considering the great risk you’re protecting against. It could just be a monthly $10-45 out of your paycheck. Many employers offer group rates that are less expensive. You can also reduce your premiums even further by extending your elimination period (the period before benefits kick in), shortening the term of your coverage, or replacing less of your income. Disability insurance is also significantly cheaper and easier to get when you are young and healthy. Don’t wait until your symptoms start!

Another component of disability insurance worth mentioning is the difference between “any occupation” and “own occupation” insurance. Any occupation means you must be incapable of doing any job, not just what you currently do. The premiums are significantly cheaper than own occupation, however this kind of plan can be risky for highly specialized employees. For example, if you are a surgeon and lost your hand making you unable to perform surgeries, but you can still flip burgers at McDonald’s with the other hand, any occupation disability insurance would not accept your claim (but you would still have a significant income reduction). However, if you had own occupation insurance, any injury or condition that prohibited you from performing surgery (your current occupation) would qualify you for disability benefits. Knowing this distinction is important when analyzing your disability insurance coverage.

No one wants to think about the worst happening. However for you and your family’s needs, you should protect yourself against the risk of becoming disabled at a young age by having disability insurance. It is way better to be safe than sorry!

As those job offers and benefits packages start rolling in, consider scheduling an appointment with a Powercat Financial Peer Counselor before the end of the semester. We would all be happy to go over your offer(s) to further explain your benefit options, including disability benefits.

Abby Pope

Peer Counselor I

Powercat Financial

www.k-state.edu/powercatfinancial

PowercatFinancial@k-state.edu

 

Sources:

https://www.servingeducators.com/2013/01/do-young-people-need-disability-insurance-2/

https://www.bankrate.com/finance/insurance/young-adults-need-disability-insurance.aspx

https://www.usatoday.com/story/money/personalfinance/2013/05/07/disability-insurance-benefits/2127267/

Come see Young Money LIVE! Tuesday April 3rd 5:30-6:30

Learn 5 Powerful Steps To Financial Success at Young Money LIVE!

Do you worry that you need a six-figure salary to be financially successful?  Do you have money on your mind more often than you’d like? Do you feel overwhelmed because you don’t know where to start when it comes to managing your money?

Worry no more! Powercat Financial is hosting Todd Romer, founder of Young Money University and the Young Money LIVE! Financial Success Speaking Tour. Romer has been teaching and coaching thousands of millennials how to create a life that fits their dreams by learning how to think about and see money differently. Many of the students he has visited on college campuses even began calling him their money coach. He is also the author of the new book Young Money: A Powerful 5 Step Plan to Financial Success Now.

The 1st step of his book is to Make a Decision to Dream.

Romer mentions that although it may seem odd, this step is absolutely essential in creating the foundation to one’s financial success. He believes that too many young adults “are just wandering through life and afraid to dream real dreams because of good old fashioned fear”.

Figure Our Your Why?

Romer then challenges us to find our purpose or reasoning behind our goals and dreams. He believes finding our WHY is what will consistently motivate us to stay committed. If we remember and focus on our WHY, our purpose, then everything should fall into place.

Set Short, Mid, and Long Term SMART Goals

It is important that we give ourselves the practice of achieving short term goals first so that we don’t get discouraged in achieving those larger dreams and goals. Be sure that when setting goals that they are Specific, Measurable, Attainable, Relevant, and Timely.  A few examples are listed below:

  1. Short Term – I will set up an automatic savings plan this week by having my employer put away 10% of my paycheck into my savings account and the remaining 90% into my checking account.
  2. Mid Term – I will save $7,000 within 1 year to put toward a used car.
  3. Long Term – I will save $150,000 in 15 years to pay off my mortgage in half the time.

To find out Steps 2 – 5, attend Young Money LIVE! on Tuesday, April 3 at 5:30 – 6:30 p.m. in Room 1088 of the College of Business. The first 75 student attendees will receive a free copy of his book! Stick around afterwards for a book signing reception from 6:30 -7:30 in the atrium of the College of Business.

Co-sponsors of this event include Powercat Financial, the College of Business and K-State Credit Union. This event kicks off April’s Financial Literacy Month and is part of Wildcat Wellness Week.

If you have any questions about the event, please don’t hesitate to email Powercat Financial at powercatfinancial@ksu.edu.

Princess Moran

Graduate Assistant and Peer Financial Counselor I

Powercat FinancialYoung_Money_Live_flyer-wi7unf

2018-2019 FAFSA Priority Date is Friday December 1st!

With finals coming up, I’m sure the last thing you want to hear about is student loans or the FAFSA. BUT THE PRIORITY DATE HAS CHANGED to December 1st for the 2018-2019 FAFSA which is this Friday! It can be overwhelming to complete this application. However, in this article we’ll be answering some frequently asked questions about FAFSA and showing you why it’s not so scary after all!

What does priority date mean?

Priority date is the date that you should get your application in to be considered for limited funding; however, it is not the deadline. While the deadline isn’t until the end of the academic term in the state of Kansas, we encourage all students to apply by December 1st so they can be considered for priority funding.

Am I dependent or independent?

If you are uncertain about your dependency status, you can check www.studentaid.ed.gov to find out more. Some criteria that determines whether you are dependent or independent includes: your age, your marital status, whether you serve in the military, etc. If you’re dependent, you’ll report the information of both you and your parents, while if you’re independent, you’ll only report your own information.

What’s the difference between a grant and a loan?

A grant is financial aid given on a needs basis. Grants are going to be the financial aid that you want to accept first since you don’t have to pay these back. Some examples of grants include: Pell, KS Comprehensive, and Freshman Wildcat. Loans will come next in the hierarchy of what you want to accept since you will have to pay these back.

What’s the difference between a subsidized and unsubsidized loan?

The difference between subsidized and unsubsidized loans is when the loan accrues interest. Subsidized loans will be what you want to accept first. These loans are need based and will not accrue interest until after you begin your repayment. Unsubsidized loans are not given on a needs basis and will begin accruing interest once fully dispersed. It’s important that if you have unsubsidized loans that you regularly fulfill your repayment obligations so that you can avoid capitalization. Capitalization occurs when previous interest left unpaid begins to accrue interest as well. This will occur at the end of your 6 month grace period.

What’s work study?

Work study is another form of financial aid given by the government through your employer. If you check the box on your application indicating you are interested in work study and are eligible, then after finding an on-campus job, the government will pay part of your paycheck and your employer will pay the other part. This helps motivate students to work on campus and encourages employers to hire students.

Hopefully after learning these tips you’ll be better prepared to complete your FAFSA application. If you need any additional resources regarding your application feel free to make an appointment with Powercat Financial at www.ksu.edu/powercatfinancial!

Avery Bolar

Peer Financial Counselor I

powercatfinancial@ksu.edu

Don’t Forget To Talk About Money Over Break!

Winter break and the holiday season are approaching and it’s the perfect time to talk about money. Here are a few table conversations you should have this year.

Model good financial behaviors. These gatherings are an opportune time to educate younger members of the family on financial literacy. This may come with an eye roll, however, it is important they learn from older family members about your financial successes and failures. Younger family members are more receptive to advice from family other than their parents and soon they will be in your shoes. Therefore, talking about your holiday budget or college scholarships wouldn’t be a bad thing to discuss.

Student loans and college savings. Have an open dialogue about the finances you have available for this next year as the priority deadline for the FAFSA gets closer (December 1, 2017, for the 2018-2019 academic year). It is important that you are on the same page as your family in what you need for this upcoming year. Expenses and income vary every year and it is important to be transparent about how finances are currently going and how you foresee them in the future. Discuss expectations regarding spending, work, borrowing and other such financial matters.

Tie it to a gift. If gift giving is part of the celebration than find a creative way to teach about money while still giving people joy. This can be done through a piggy bank or a contribution to a college savings plan if they are younger. These gifts can be supplemented with conversations about savings and giving to those in need in your community.

Discuss long-term plans. This doesn’t need to be a morbid conversation. However, estate planning, long term care, and medical preferences are something a family should talk about. As family members grow older there is information we should know and be able to talk about. This could be brought up naturally from a grandmother talking about putting something in her will for you or a joke about putting your family members in a home one day. These prompts could lead into a real conversation about their needs and wants. This is an opportune time to discuss this while all family members are present that will be affected. There are times that this conversation wouldn’t be appropriate, however, it is an important topic to discuss.

You dont have to solve everything. This chat is not meant to be stressful only helpful. This chat doesn’t need to go past transparency and financial responsibility to start setting expectations for family members. But it is important that you have these multi-generational conversations and to start a habit of having open, ongoing dialogue with your family.

If you’re not sure how to get the conversations started, simply print this post and share it with your family members as a guideline of financial topics you can review together. Don’t forget you can make a free appointment with us anytime from our website at www.ksu.edu/powercatfinancial, to discuss any of these financial matters or questions you may have in more detail.

Alex Bangert

Peer Financial Counselor I

powercatfinancial@ksu.edu

Exploring Private Student Loan Options

It is about that time of year again; Time to fill out the Free Application for Federal Student Aid, also known as the FAFSA. The priority deadline for filling out the FAFSA is December, 1st, which is much sooner than the March 1st date it had been in prior years. Mark it on the calendar and request an appointment with Powercat Financial to familiarize yourself with the FAFSA and federal student loan process. Peer Counselors can help you plan out your financial future and come up with how much you need to borrow. It is crucial to accept ONLY what you need to prevent over-borrowing.

For some students, savings, scholarships and federal aid may not be enough, so they may be forced to consider private loans to help pay for their education. What options are out there?

FASTChoice Tool: A guide to helping you choose your private loan which can be found at http://www.k-state.edu/sfa/aid/loans/private/

FASTChoice is a resource tool to allow students and families to see what lenders and loan products are available to help pay for educational expenses. If a student is in need of additional financial assistance, this tool should be the first place he or she turns to.

Before exploring the tool, it is important to know what to be looking for. There are several key categories to private loans that all students and families should be aware of before applying for loans.

Interest rates:

Lenders rarely give complete details of the terms of private student loans until after the student submits an application. For example, many lenders advertise the lowest interest rate they charge (given out to good credit borrowers). Most students, with little to no credit, must be aware of this while comparing different lenders.

Students should also consider the differences between fixed and variable rate loans. The difference is simple: the rate on a variable interest rate loan can change over the life of a loan, whereas a fixed rate will remain the same unless you refinance it. On the other hand, rates on government student loans are always fixed, and don’t take into account the credit risk posed by the borrower. With that being said, it is important to understand and decide which type of private loan you want to apply for.

Fees:

When looking at different loan options, make sure you understand what if any fees they may charge and if this fee comes out of your loan proceeds.

Repayment plans:

Private loans do not have the same range of flexible and affordable repayment plans as federal student loans do. Private lenders may offer flexible repayment plans or other affordable options, but they are not required to do so. As you begin to explore the tool, examine which lenders offer repayment plans and understand the details associated with each. You should review your private loan contracts carefully to better understand what rights you have.

These are just a few key, and important areas regarding private student loans. It is crucial that you understand what you are applying for before filling out the application. The FASTChoice tool offers an easy way to compare loan options from different lenders. If you are having a hard time understanding the details of these loans, schedule a meeting with a peer counselor today!

Upsides to private student loans (https://www.estudentloan.com/blog/pros-cons-private-student-loans)

  • Private loans may cover the total cost of attendance
  • Cosigners may often be able to be released from the promissory note after the student makes a number of on-time payments

Downsides to private student loans (https://studentaid.ed.gov/sa/types/loans/federal-vs-private)

  • Fewer in-school benefits and may have higher interest rates than federal student loans as rates are based on credit-worthiness
  • Lenders may require an established credit record and also a cosigner
  • Students with private loans will not be eligible for loan forgiveness programs
  • Private loan repayment plans will likely not include income-based repayment options like federal loans offer
  • Private debt follows you to the grave and others may be held responsible. Federal student loan debt dies along with you and will not count against your estate when you pass away.

 

Nolan Keim

Peer Financial Counselor III

powercatfinancial@k-state.edu

Plan Now To Spend Your Summer 2018 Abroad!

Have you ever been out of the country? Well, Kansas State University has just the opportunity for you. From May 16, 2018, to June 16, 2018, K-State is going to Italy. This experience would not only be a great time, but it would also look really sharp on your resume. Employers look for unique experiences that set candidates apart and this may be just that!

While in Italy, along with sight-seeing and exploring, you will be able to take two classes with K-State faculty and students that will help fulfill credits toward your major or minor. Here are some classes you can take:

  • ART 630 – Orvieto Sketchbook, Erin Wiersma
  • ART 628- History of Italian Art and Architecture, Douglas Dow
  • HM 499- Food and Wine of Italy, Elizabeth Barrett, Pat Pesci, and Kelly Whitehair
  • MC 589- Intercultural Digital Storytelling, Andrew Smith
  • MLANG 100- Italian for Travelers, Allessia Salamina
  • PHILO 399- Honors Seminar in Philosophy – Leonardo & Galileo: Science & Religion in the Italian Renaissance, Scott Tanona
  • MKTG 400- Introduction to Marketing, Swinder Janda

The program has requirements that you must meet if you want to attend. A few of them consist of:

  • Minimum Sophomore Standing
  • Minimum 2.5 GPA
  • English Proficiency
  • Application Priority Deadline: December 1, 2017
  • Application Final Deadline: February 1, 2018

The program also offers scholarships and financial aid for your assistance. For more information, you should contact the Office of Student Financial assistance for options on summer financial aid. The program fee is $3,000 and for six K-State undergraduate credits (equivalent to 2 classes) at Global Campus Fee, the tuition total is $1,904.60. Additional expenses would include: passport, international flight, individual meals, textbooks, refundable housing deposit, phone plan and personal travel. The program fee will include: airport pick-up, accommodation, international health insurance, excursions to Rome & Florence, local field trips, workshops, welcome & farewell dinner, KSU in Italy administration costs, and Education Abroad administrative fee.

If you have any questions about this great experience, contact Education Abroad at 785-532-5990 or email overseas@ksu.edu.

If you have questions about how you are going to start saving for this trip, or if the cost overwhelms you, schedule an appointment with Powercat Financial at www.ksu.edu/powercatfinancial and we will help you set up a budgeting and savings plan to meet this financial goal or any others you may be contemplating! We can help make your financial goals a reality!

Hannah Eilert, Peer Financial Counselor II

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