Today we have a sponsored post from Total Jobs.

There has been a lot in the news recently about the troubles facing the young generation. Recent unemployment figures, for instance, put youth unemployment at around 20%. Similar trouble is afflicting many graduates, with a lot of people leaving university finding it hard to find suitable work and many working in unpaid internships in order to gain valuable work experience that could help them to land a paid job. But is it all bad news, or are some graduates bucking the trend and coming out of the tough economic and job climate better than others?

Recently, Total Jobs conducted a graduate jobs survey to find out about the sort of graduate jobs people go for and other trends associated with graduates. One interesting statistic to emerge from the survey was that 80% – a huge majority – of graduates thought things were harder for them now than they were 10, 5 or even 2 years ago. This perhaps reflects the growing number of graduates going after each job, as well as the lingering after-effects of the recent recession on the graduate jobs market.

Also, a significant minority of students – 47% – believe that university is now just ‘education for education’s sake’. This might sound worrying and as though the value of a university education is not as great as it once was, but there is still much cause for hope. That same statistic shows that a majority of students still think there is more to university than just education for its own sake. Many say that they would repeat their university experience simply because they enjoyed it, suggesting that it is about more than simply getting a good job at the end of it.

Another thing to consider is that 87% of graduates questioned felt as though their education gave them the skills they need to succeed in an entry-level graduate job, which arguably suggests that a lot of the issues lie within the job market itself rather than what students are learning on their degrees.

Many universities also now have a greater focus on recruitment and the majority of graduates said they felt their degree makes them more employable. Also, more graduates seem to be turning to alternative options to make the most of their skills in a challenging environment; 53% have considered setting up their own business as an alternative to getting a job. All of this suggests that while times aren’t ideal in the job market, the value of university is still high and savvy graduates can definitely still turn things around to their advantage.

Like everyone else and their mother, I have student loans. I’m rocking a Stafford loan that I owe around $6,000 on and a Parent PLUS for $4,000. Expected payoff date: Who knows. I’ve handled the extra cash I receive from refunds pretty well  – I even sent most of it back as payments. On July 8th, I made a $1,000 payment to help reduce interest charges. Two weeks later and there’s no record that any payment was ever processed:

That’s not cool, so I call up My Fed Loan Servicing. Not the most creative name, but it works I guess. After holding for an unacceptable amount of time, I had the dumbest conversation of my life.

Me: “I made a payment on the 8th of July for $1,000 that isn’t showing up.”

Phone Rep: “Let me look into your account, one second…..OK, I am showing that payment on my screen.”

Me: “So why can’t I see it?”

Phone Rep: “Well, any funds returned 120 days after a disbursement are considered a cancellation payment and don’t show up.”

Me: “Then why can I see 2 previous cancellation payments?”

Phone Rep: “I’m not entirely sure.”

Me: “Well this makes it just about impossible to keep track of what I actually owe…”

Phone Rep: “I agree completely and I believe they’re working on a way to let borrowers see all payments made.”

Me: “Yeah, they should get on that. Thanks.”

What kind of company is this? Their only purpose is to manage student loans and collect payments. How hard is it to actually, you know, manage the loans?!? Right now I’m being told I owe $4,100. I have no idea if that’s actually the correct amount. My net worth update from June, before the payment was made, says I owed around $5,200. So a $1,000 payment in July does seem to match with the new balance.

Still, not showing all payments is the dumbest thing I’ve ever heard of. Over 4 years of school, it’d be extremely easy to lose track of how many payments you made and good luck getting a straight answer out of the people you sent the money to.

Do you have any student loan horror stories? Mine isn’t really all that bad, but it’s still frustrating. Let’s hear ‘em!

What up everybody! After working like a dog all week long (see: my lack of posting), I came home Saturday night to one of my favorite emails of all time. My school was notifying me that my financial aid award for the 2011-2012 school year was ready to view. I’ve received a few of these emails over the last couple of months as my loan stuff and everything comes in, so I knew something good was about to happen.

A few clicks later and this is what I’m staring at:

My favorite screenshot of all time.

See that top line worth $2,690? That definitely wasn’t there before. My study abroad trip just cost me $2,700 less than it was going to. So how what sorcery did I have to perform for this to happen? I filled out a form. Not kidding.

Way back in March, I filled out my school’s continuing student scholarship form. I didn’t expect to get anything. The form itself even warns you that most scholarships go to juniors and seniors. But it only asked for a 300 word essay, so I deleted 200 words from the previous essay I’d written for another scholarship and copy and pasted it in. Efficiency at its finest.

I’d say it took me 20 minutes to complete that scholarship form. That makes my hourly wage something like $8,070! I’ll take that any day of the week and twice on Sunday. Now I really don’t have an excuse to come home with at least some leftover money.

What’s the easiest way you’ve ever “made” money?

I’ve been out of school for 31 days and I’m just now selling my text books from last quarter. And the quarter before that. And that quarter before that. A few books are even from my senior year of high school when I took community college classes to get a head start on my bachelor’s. You could say I have a procrastination/laziness problem.

The important thing though is that I’m getting rid of them. I have enough clutter in my room; I don’t need text books I’m never going to open again. I want as much cash as possible, but I’m willing to take a smaller amount if it means I do less work. I’m using 3 different services to get cash for my books:

eBay – I listed one of my accounting books here. It’s easily an edition or 2 out of date, but accounting is one of those subjects that doesn’t really change that much so a lot of instructors might still be using this one. One recently sold for $50. I’d be happy with that, since I paid nothing in the first place.

Half – eBay owns Half.com, but you can list things separately. I put a philosophy book I used my senior year of high school on here. I think it’s more likely to sell on Half compared to eBay and for a higher price if it does.

Chegg - I’ve bought a book or 2 from Chegg.com and had a good experience. This is my first time selling through them, but so far the process is easier than tying your shoes. I typed in the 2 books I had, printed out a packing slip and all I have to do now is drop them off at a UPS store. I should receive a check in 10 days.

I predict Chegg will be the easiest method to use and the one that gets me the most cash. Once I actually get the couple hundred bucks I expect though, the question becomes what to do with it? As much as I want to consider book money to be free for spending, I know I have to buy…more books. .

Where do you sell you sell your textbooks? Does anyone else just want to blow any money they get back?

I’m 53 days away from jumping on a plane and heading out on my own for a few months. Not that I’m counting or anything. My 4 months in Italy will be the first time I’ve ever not lived at the house of Mom & Dad. Kind of crazy when I think about it like that. Everyone keeps asking me if I’m nervous and I keep saying no, which is 99% true. Saying yes would probably make me more nervous and I’m trying to avoid that.

Being out on my own got me thinking though about how long I’ll call this place home. Studying abroad is temporary. I already know the exact time and date I’m coming home. My bedroom will be waiting for me exactly like I left it. But what about after that? I’ll still have at least 2 years of school left. If I stay for my masters, which I will unless I get an awesome job, that makes it 3. There are definite pros and cons that come with living at home:

Things That Rock About Living At Home

Cash. Flow. No rent, no utilities, no groceries.

Nice thangs. Better than what I could afford on my own.

Room. House = bigger than any apartment in my area. Huge yard and no neighbors.

Things That Make Me Want To Sign A Lease

The feeling that I’ll be here forever. For-ev-ver. For-ev-ver.

Gotta be super quiet when I come home at 3AM so I don’t wake anyone up.

The “I don’t really approve of what you’re doing, but I’m not going to stop you” look I get sometimes all the time. See: Coming home at 3AM

Right now though I’m 100% against living on my own if it means taking on extra student loan debt. I’m on track to easily owe $30,000 at graduation and possibly as much as $50,000 while living at home the entire time. I obviously made an exception for leaving the country, but studying abroad is about more than just living by yourself. Even if I could afford to rent my own place in another year or 2, I’m not sure I would. Not having rent to pay would add up to around $7,000 a year. Graduating with $14,000 or more saved up would be cooler than the time I found $60 bucks in my Bible.

When did/will you move out of your parents house? Is it lame if I want to stick around for a few years to save money like it’s my job?

I have a love/hate relationship with student loans. I love that they make it possible for me to go to school. I hate that school is so expensive in the first place and I hate worrying about paying them back. But, I know my own situation is far better than the one that some students find themselves in. I don’t think I’ll have a terrible time paying back my loans, but others aren’t in the same boat.

A reader recently left an interesting comment on a post where I asked how much student loan debt is OK:

My question is that I’m worried about a friend who has $70K+ in college loans after graduating from undergrad due to out-of-state tuition. I’ve read horror stories online and you still have to pay student loans if you file for bankruptcy. What do people do if they absolutely can’t ever pay them back?

Scary to think about, isn’t it? I didn’t know the answer myself but with some Google-Fu, I found out a ton of information.

If your student loans are so bad you’re considering bankruptcy, you’re basically screwed. Sorry. Both federal and private students loans will only be discharged in a bankruptcy if you can prove a few things. Your friend probably can’t. In fact, I bet almost no one can. From www.bklaw.com, those things are:

1. that you cannot maintain, based on current income and expenses, a ‘minimal’ standard of living for yourself and your dependents if forced to repay the loans; This is usually the easiest prong to satisfy.
2. that additional circumstances exist indicating that this state of financial affairs is likely to persist for a significant portion of the repayment period of the student loans
3. That you made good faith effort to repay the loans. This does not just include making payments on the loans.  It requires doing things over time such as making efforts to increase your income (which includes going back to school to get additional degrees or experience), consolidating loans with the Direct Loan Servicing Center, and other similar efforts.

Editor’s note: Does that last paragraph seem dumb to anyone else? Isn’t it possible that going back to school and borrowing more could actually be the cause for the bankruptcy in the first place?!?

Up until 2005, private student loans were a lot easier to get rid of in a bankruptcy. But then the Bankruptcy Abuse Prevention and Consumer Protection Act was passed. That entire law was heavily supported by banks, credit card issuers, and other creditors. I don’t mean heavily supported as in “Yeah, I like Lady GaGa’s new song.” I mean they foaming-at-the-mouth-let’s-spend-100-million-dollars-get-this-passed liked it.

I couldn’t find any examples of what type of income and amount of debt would qualify for a discharge (shocker), but I bet anyone with a median US income or higher doesn’t qualify.

Why was this law necessary? The banks claim that bankruptcy protection is heavily abused – I’m not convinced. Most bankruptcies are caused by medical bills and/or job loss – not surprising in a country without universal healthcare. I’ve also heard the claim that medical school students were taking out hundreds of thousands in student loans, filing bankruptcy after graduation, and then going on to earn high salaries. But I can’t actually find any proof of that at all.

So bankruptcy is probably most definitely out for your friend. Quick question though – $70,000 doesn’t seem that bad. Is your friend having trouble finding a job or do they work in a low paying field? If so, I understand, but otherwise, I’d just focus on paying as much as I could each month.

Since you will pay back every cent you borrowed, it’s best to borrow from someone is going to be as easy going about repayment as possible. That someone is your Uncle Sam. Federal student loans are the best possible loans you could ever take out for one simple reason: you get to pick from a million different repayment options. This is a quick and dirty list:

• Standard – fixed monthly payment for 10 years
• Extended – Fixed annual or graduated amount over 25 years. You’ll probably pay more interest than what your degree actually cost. You also must have $30,000 or more to repay.
• Graduated – Payments start out smaller and increase every 2 years. Balance will be paid off in 10 years or less.
• Income Based – Required monthly payment is limited based on income and family size
• Income Contingent - Payment amount is adjusted each year based on gross income, family size, and amount of loans. Any balance remaining after 25 years (!) of payments will be forgiven. Doesn’t apply to Parent PLUS loans.
  

Quick note: Defaulting on federal loans is an extremely bad idea. The government WILL get its money. Remember that scene at the end of The Social Network where Sean Parker tells Eduardo Saverin “We will get the signature”? It’s just like that, only with the force of the US Government and you won’t receive a million dollar settlement like Eduardo. Default and think you’re getting a tax refund? You will never see a check. Default and you may not even be able to renew any professional licensees. CPAs & MDs – that’s you!

Damn, this post is getting long. I’m gonna wrap things up and just say that this should be a reminder to not borrow money like there’s no tomorrow. I know there’s pressure – and I think it’s a crime that every high school student in the country is told to borrow borrow borrow go to college, get a good job, and everything will be OK.

You can’t control the price of tuition and you probably don’t have $100,000,000 to bribe lobby politicians to pass laws you like, but you still have the final say in what you borrow. Consider state schools and community colleges to reduce the price of your education. Think about vocational training or starting your own business if the thought of writing another paper makes you want to stab yourself in the face.

This post comes from Mike of CreditCardForum.com, which is a forum for the best credit card reviews (or at least that is what he hopes for it to be). Most recently he wrote the Blue Cash American Express review.

Warning: Before you even read this post, I’ve got to warn you – Even if you pay little to no interest, carrying a credit card balance is definitely not for everyone! There are so many ways credit card companies can screw you over it ís not even funny. I’m not writing about this topic to actually advocate it, but rather to demonstrate how ridiculously expensive student loans are right now.

My friend, Chris, who is a few years older than me was laid off from his job last fall. His bachelor’s hasn’t exactly been too helpful in landing him a new job, so he’s decided to go for a law degree.

His options? Well, there are 20 ABA-accredited law schools in California and of those, just about all of them cost about $40k or more per year. And I’m not just talking about the trust fund baby schools like USC and Pepperdine. Even the U.C. law schools run $38,906 to $44,244 (and even more for out-of-state residents). So here is the rough math on how much he will have to pony up over his 3 years of school:

$40k per year tuition = $120,000
$3.5k per year for parking, books, misc. school expenses = $10,500
$7.2k per year for rent and utilities ($1,200 per month split between 2 people) = $21,600
$3.8k per year for health insurance = $11,400 (most schools require this)
$4.5k per year for food = $13,500
$650 per month for car (payment + insurance + gas + maintenance) = $23,400
————————————————————————–
Grand Total = $200,400

Now I’m not accounting for inflation and miscellaneous expenses, but that figure is a ballpark range for how much money he has to come up with. You may be asking why I am not factoring in part-time income? Well, some schools like Chapman actually force students to sign an agreement where they agree to work no more than 20 hours per week (which is ridiculous). So depending on where he goes, working may not even be an option and if it is, I can’t imagine he will be able to bring in more than a few thousand a year while he’s juggling full-time law school.

For non-private loans, here is what he has been offered:

Subsidized Stafford Federal Loan – $8,500 per year at 6.58%
Unsubsidized Stafford Federal Loan – $12,000 per year at 6.58%
Unsubsidized GradPlus Federal Loan – Up to cost of attendance less other aid at 8.5%

So with the exception of the $8,500, he’s looking at paying 6.58% to 8.5% starting from day one. Please, someone tell me why the Fed can afford to loan money at essentially 0% to the banks but hard working grad students are socked with up to 8.5% interest?! I think it is outrageously high and so does he. So guess what he’s decided to do? Pay for the first year using credit cards!

The plan to use 0% credit card offers
Ryan wrote a post earlier this year about the crazy idea of balance transferring your student loan debt away. Well I have to agree it is crazy for 99% of people, but for my friend it actually might be worthwhile. Here’s why:

Since Chris is older, he has a great credit history with high credit limits. In addition, his mom has actually agreed to help out and use her credit to do this. She has a Chase Freedom card with a $32,000 limit and a Blue Cash American Express with a $44,000 limit as well as a few others.

• He’s checked and the schools on his short list don’t have caps on credit card limits. So if someone is crazy enough to do it, the school will let you pay for your 40K of tuition on plastic.
• Assuming he avoids the balance transfer fees, he will actually be netting a few hundred dollars in rewards since the cards give 1% to 1.25% cash back.

Chris asked my advice for the best way to pull this off and here’s what I told him:

Step One: Get a card that offers 0% on purchases
American Express regularly runs promos that give 0% on purchases for the first 12 months. If his mom applied for a second AmEx, it’s unlikely she would be given a credit limit anywhere close to what she has on her old Blue Cash card (which she got before the recession) but lets say she opened one of their other cards with the 0% on purchases offer and was given a $10k limit. What she could then do is transfer a good chunk of her available credit from the Blue Cash over to the new card and bam! She suddenly will have a card with a lot of spending power AND the 0% on purchases!

Step Two: Charge the tuition to the new card
This actually may be the hardest part, because it definitely takes some balls to make a $40,000 purchase with plastic! (Though most schools allow payments on a per semester basis, which would split it into 2 payments).

Step Three: Setup automatic bill pay + watch the account like a hawk
Even with the credit card reform, if you make 2 late payments with 6 months that might be grounds for a rate hike. So obviously they will have to do everything possible to avoid this. I recommended setting up automatic payments and also watching it manually, in case something goes wrong with those.

Step Four: Before the 12 months is up, transfer or pay it off
Carrying the balance past the 0% period would be insanity. So he would either need to transfer it within 365 days from the date of account opening or pay it off. This is definitely risky because who knows where the economy will be in a year? 0% offers might not be around! However lucky for Chris, his mom says if all else fails, she will tap her savings to pay it off and then formalize a loan between mother and son to pay it back.

They haven’t decided yet whether this will be a one-time thing or something they try and repeat every year, using credit cards to finance as much of law school as possible. What do you think? Is Chris insane or does this approach actually make sense for his circumstances?

Editor’s Note: While balance transfers allow you to pay down a balance without interest, they still require minimum payments. Most cards have minimums of 3% or 5%. A 3% minimum payment on $40,000 is $1,200!

Last summer I made the decision to commute to school this year. Originally I had planned to live on campus, but as move in day got closer, the idea of borrowing an additional $8,000 on top of tuition didn’t seem smart. I’m not debt-phobic, but I can think of a million different things I’d rather spend my money on than student loan repayment.

So financially, I made the right choice. But numbers on a spreadsheet don’t tell the whole story. In real life, how you feel about something and how it actually affects your life matters. While I may have saved money, some things really sucked about not living on campus:

• The Drive – I feel dumb for bitching about a 30 minute (one way) drive since I know that’s normal for a lot of workers, but it sucks when you know you could be a 5 minute walk from class.
• Living with your parents – No matter how old you are, living with your parents is living with your parents. “Nuff said.
• Being involved on campus – I’m technically a member of the finance club but I’ve been to zero meetings. Why? Probably because they were at 8:30am and my first class fall quarter didn’t start until 11. Not being able to just roll out of bed and go to a meeting destroyed any motivation I had.
• College experience – It’s hard to go to parties and do all that illegal stuff when you don’t live near campus. Some people have no interest in this, which is fine. I didn’t think I’d really want to either, but it turns out I was wrong.

All those things were “costs” of living at home. They aren’t enough to make me regret living at home, but it wasn’t as great a choice as I originally thought. I’ll be able to do a lot what I missed out on in Italy, which makes up for most of it. After Italy, I have 2 quarters left of sophomore year that I’ll spend at home. After that though, I’m considering living on campus for my junior year. Financially, it probably won’t be the best decision, but I want to at least think about the option.

Did you make any financial situations that saved you money (or made you money), but had other effects you didn’t think about originally?

Do you ever feel like punching people who have no motivation or drive in the face? Monday was my final exam for my accounting class. The exam started at 10:45am and you had 2 hours to take the 30 question test. I’m busy getting my credits and debits figured out when I hear a super loud noise: the door opening. Who walks in? The same guy who was late every single day to class. He goes up to the proctor, gets the exam, and acts like he’s not late. It was 11:30.

Who shows up for an exam 45 minutes late?!? I was pissed. The exam wasn’t a walk in the park and I had to focus to make sure I understood the questions. Him interrupting everybody was beyond rude. I get back to work, but only for around 10 minutes. Because then another idiot walks in. Who are these people? I don’t want to be Melvin, but come on. If you want to skip classes all the time and be as lazy as f*ck, that’s fine, but don’t interrupt other people who actually give a damn.

College is expensive. I don’t pay $8,000 a year to skip dozens of classes and then (probably) fail my exams. I pay that money to actually learn something. Of all the ways to waste money, I thinking going to college but not doing any of the work is one of the dumbest.

Anybody else not understand these people?

I love me some free money. Even more so when I wasn’t expecting it at all. That’s exactly what happened on Friday. I got an email from my school letting me know my financial aid offer was available to view and accept. I’d been waiting for this to come for weeks – even though I knew most of it would be “aid” in the form of loans. You never know when your school will surprise you with an extra scholarship or additional aid.

That’s exactly what they did. In addition to the typical mash up of loans and a renewable scholarship from I received in high school, I was awarded a grant for $1,467. Grants = free money that, never needs repaid. This freakin’ made my day. I’m sure Debbie Downer would be all “Big deal, it’s only $1,467. Look at how much you’re still borrowing.” But let’s get real people – every dollar given to me is a dollar I never have to repay with interest. Debbie Downer can STFU.

So this aid is awesome, but IDK who made the decision to give it to me. The 2011-2012 aid year is based on 2010 taxes – that’s what you used (or should have used) to fill out this year’s FAFSA. In 2010, I made a million times (not really)  more money than I did in 2009. Thanks to U.S. Census Bureau, I banked something $7,000 plus an additional $2,000 and change from a part-time job later in the year. Even stranger, I’m 99% sure my dad’s income went up too. This surprise money though  is a good reminder to:

1 – Fill out the FAFSA. Even if the government won’t give you money, a lot of schools and outside scholarships want a copy of the FAFSA you submitted to determine what you’re eligible for.

2 – Apply for continuing student aid. I’m thinking that this is what allowed me to get a better award this year. There are some scholarships and aid that you can’t get until after your first year – each school has their own way of dealing with funds.

3 – Be awesome. This has nothing to do with the new grant I got, but remember that a good GPA will also result in free money a lot of times. My 3.5 HS GPA got me a $1,500 yearly scholarship renewable for all 4 years. To keep it, I just have a maintain a 3.0 GPA. That’s $6,000 I won’t have to pay back.

*My Personal Finance Journey hosted this week’s Carnival of Personal Finance: Most Expensive Hotel Rooms in the World Edition. Check out financial posts from dozens of different PF bloggers.