Cash Management (deciding how much to keep in cash and where to store it) is a crucial step to meeting financial goals and weathering emergencies. You may choose to use a bank, credit union, or both. Choosing the right financial institution starts with knowing your usage and individual preferences.

Bank & Credit Union Basics

Both offer similar services:

• Checking/savings accounts
• Home and personal loans
• Auto loans
• Physical or strictly online

Credit Unions Operate Differently:

• Member owned Co-op
• Members are associated
• Return profits to members via lower loan rates and higher savings rates

Top 4 Things to Consider When Choosing

• Safety (FDIC/NCUA Insurance)
  • Protects from financial institution failure
  • Insures up to $250,000 per depositor
  • Covers deposits accounts, 401ks, IRAs, Trusts
• Using multiple institutions maximizes insurance
  • Cost ATM Fees (Deposit, Withdrawal, Balance Inquiry)
  • Minimum Balance Requirement
• Fees
  • Returned Check Fees and Overdraft (NSF) Fees
  • Monthly/Annual Fees
• Annual Percentage Yield: The simple annual percentage yield that converts deposit account interest rates compounded for different periods into comparable annual rates. Compare different deposit account APYs at bankrate.com

Our Campus+ Partner

As you start your college career, it’s important to start thinking about choosing a bank or credit union to house your money. There are a lot of factors to consider. There is no one right bank account for every person. Choosing the right bank starts with knowing your bank usage and individual preferences.
Top things to consider when choosing a banking institution:

• Security of your funds
• Online banking features
• Fees
• Minimum balance requirements
• Ease of deposit
• Branch availability
• ATM fees
• Customer service
• Interest rates
• Availability of funds
  
  

With a little consideration for your banking habits and needs, you can find the right bank account at the right price. Our Campus+ Partner is here to help you make the best decision for you. Check out what Aggieland Credit Union has to offer you.

Aggieland Credit Union

Bank Like an Aggie

Calling all Aggie students! Are you ready to show off your Aggie pride in every transaction? Look no further than Aggieland Credit Union’s exclusive Student Checking account with your choice of debit cards that proudly display the iconic Aggie imagery.

As an Aggie, you know the value of community, tradition, and smart financial choices. That's why we've created this special checking account just for you. Not only does it offer all the benefits of a traditional checking account, but it also comes with an Aggie-branded debit card, allowing you to make purchases while proudly displaying your love for Texas A&M.

With our Aggie Student Checking account, you'll enjoy the convenience of no monthly fees, no minimum balance requirements, and access to our mobile banking app, making it easy to manage your finances on the go. Plus, you'll have the peace of mind knowing that your money is in the hands of a credit union that understands the unique needs of Aggie students.

Join the ranks of fellow Aggies who are banking with pride. Open your Aggie Student Checking account today and carry the spirit of Texas A&M with you wherever you go!

Budgeting

Make a budget includes your expected aftertax salary (paycheckcity.com), required loan payments, planned savings, and more. 

Financial Goals: Establishing your financial goals is the first step in creating a budget. Decide what your short, medium, and long term goals are and how much you want to save toward each goal. 50-20-30 Budget: One popular professional budgeting method is the 50-20-30 budget. This divides your monthly after-tax income into 3 sections. 50% towards your needs (including minimum debt repayment), 20% towards extra debt repayment and savings and 30% towards your wants.

Eating on a Budget

As a college student, there will be many opportunities to dine out and socialize with friends. Sometimes, it may seem more convenient to pick something up on-the-go, rather than making it yourself; however, these options might not be friendly to your budget or health.

How to Eat Healthy on a Budget

Step 1: Come up with a plan. 

• Figure out your monthly budget for groceries, possibly between 10-15% of your monthly budget.
  • You can then break that down per week. 
• Create a meal plan and prioritize what items are most important to your weekly consumption. 
• Evaluate what stores you will be shopping at for these items.

Step 2: Be smart about your shopping. Though it may seem obvious, buy the cheaper generic brands for items, such as soups, dips, baking supplies, jams, condiments, sauces, frozen and canned vegetables, nuts, cheese, milk and more. 

Then, think whole foods. These are less processed foods sold in larger quantities that could offer more savings per serving. Buy fruits and vegetables that are in season, but if you are looking out of season, frozen or canned fruits and vegetables are cheaper and may last longer. 

Finally, have a variety of superfood staples on hand. Items such as canned beans, frozen vegetables, garlic and onions, eggs, sweet potatoes, whole grain pastas, and canned meats can be used to create a quick and healthy meal.

Step 3: Prepare these healthy meals.

Your meals do not have to be complex. Stick to the basics and avoid purchasing items for a single recipe you know you won’t reuse. Meat can be expensive, so substitute meat with other protein sources such as beans, veggies, or eggs. You can also opt for cheaper and tougher meat cuts and cook them longer, at a lower temperature in a slow cooker. 

Make your meals stretch further by adding nutritious staples such as rice, pasta or frozen vegetables to some of your favorite dishes. 

Remember, if you double your recipes, you can always freeze the other half and reheat it for a meal later on. Information from everydollar.com

Grocery Budgeting Tips

• Look for sale/mark down items and be willing to include these items in your meal plan.
• Don’t overlook end-caps in grocery stores. Vendors and stores love these areas for sales and deals.
• Check the frozen section for deals (veggies, breaded chicken, etc.). Easy to portion and keep.
• Shop towards the beginning or end of the day to get clearance items.
• Look up and down in the aisle. Usually the most expensive things are at eye level.
• Typically a high protein breakfast keeps you feeling fuller throughout the morning (eggs, meat, peanut butter, etc.) This may reduce your lunchtime consumption.
• Cereal is pricey. Try bulk or generic cereals/grains (oatmeal/granola). Add fresh or dried fruit (raisins, etc.).
• Buy bulk chips, vegetables, etc. and pack them yourself with reusable plastic bags.
• Lunch on-the-go and no refrigeration? Fruit, protein bars, peanut/soy butter or spreads will work.
• Protein? Canned meats and fish are good sources of protein and do not need refrigeration if consumed immediately after opening. Rice and beans are another, cheaper alternative.
• Think two dinners and a lunch when deciding what to prepare– stretch your dollar and save time. Meals built around a slow cooker or larger cuts of meat (roast) and casseroles can easily be refrigerated, reheated, frozen or morphed into other menu ideas (tacos). Slow cookers are great for many reasons – especially saving time in the kitchen. With most slow cooker recipes, ingredients are prepped and thrown into the pot. That’s it! Ready in 8 – 10 hours when you get home.

Helpful Resources

Recipes

• BudgetBytes.com
• Crock-pot.com
• CookingLight.com
• AllRecipes.com
• Pinterest.com
• Buzzfeed.com
  
  

Coupons/Cashback

• Coupons.com
• Flipp.com
• Checkout51.com
• Ibotta App
• Cent.ly
• Various grocery store apps
  
  

Restaurant Discounts

• PocketPoints App
• Hooked App
• TasteBud App
• Groupon.com
• RetailMeNot.com
• Restaurant rewards programs

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Money Management

Learning to manage your money is the most important step toward financial independence.

When was the last time the amount of change in your pocket was the deciding factor in what you would have to eat? The last time you swiped your debit card, did you hope the transaction would clear without any overdraft fees? Many college students encounter these financial situations all too often and get caught in a world of debt. Managing your money is the best way to reduce the chance of experiencing financial stress. Here are a few tips to help you get started on managing your money.

Break Down Your Needs and Wants

A need is a required purchase to pay bills for the essentials, items you “must have” each month (rent, utility bill, groceries, etc.). A want (entertainment, new clothes, going out, etc.) is something you would like to purchase after you have paid for your Needs. To avoid damaging your credit, pay off your Needs before planning how to spend for your Wants.

Here’s how to find how much you have for Wants:

• First, add up all of your monthly income. Monthly income includes money from work, scholarships, loans, grants, or allowances from family/friends
• Take your monthly income and subtract your Needs throughout the month, both fixed expenses and any variable expenses.
  • Fixed expenses include recurring bills like rent, car payments, or cable and internet bills that don’t generally fluctuate and are constant every month.
  • Variable expenses include cell phone bills, utilities, etc. in which the amount is a function of your usage and the monthly rate varies.

Once you have subtracted your Needs from your monthly income, you have your Wants amount of available cash remaining. Your Wants should be left over to cover anything you may want once all your needs are addressed. This category should cover trips to the movies, or going out on the weekends, and only allows you to spend a certain amount.. This way, you won’t lose control of your money and spend more than you realize.

Create a Spending Plan

First, estimate your income and expenses for this month. Then, track your actual income and expenses. Use your actual figures for this month to budget your income and expenses for next month. Determine which of your expenses are Needs and which are Wants so that you can realistically determine which expenses must be paid and which expenses you can cut back on. 
Download budget sheet

Cut Down Your Expenses

Housing:

• Get a roommate.
  
  

Reduce utility costs:

• Disconnect your cable TV service.
• Turn off the lights when not in use.
  
  

Saving:

• Put loose change in a jar; keep it for laundry or unexpected expenses.
  
  

Reduce your food expenditures:

• Buy house brand items.
• Shop once a week.
• Buy only what is on your list.
• Compare prices.
• Eat out less frequently and less expensively.
• Treat eating out as a luxury.
• Use restaurant coupons.
• Order entrees only, not expensive desserts or appetizers.
• Split or share meals with a friend.
• Learn to cook for yourself.
  
  

Find free or inexpensive ways to entertain yourself:

• Participate in sports.
• Check out local museums and parks.
• See matinee movies and/or seek discount movie tickets.
• Read a book.
• Rent DVDs.
  
  

Take care of yourself, but look for deals:

• Avoid memberships at trendy health clubs; take advantage of the Rec Center.
• Use coupons or specials for hairdressers and barbers.
• Don’t spend money on expensive cosmetics.
• Give yourself a manicure/ pedicure rather than paying someone else to do it.
  
  

Find an alternative to driving a car:

• Ride the bus, carpool with friends, ride your bicycle, and walk. If you must have a car, try to save money.
• Wash your car yourself.
• Purchase regular unleaded gasoline.
• Use coupons for oil changes.
• To avoid high-dollar expenses, keep your car in good condition.
  
  

Shop for clothes wisely:

• Shop at discount outlet stores, consignment stores and thrift shops.
• Avoid buying and wearing clothes that must be dry-cleaned.
• Shop for special long-distance and/or cell phone rates that meet your needs.
  
  

Check out the costs of banking:

• Avoid ATM fees, checking fees, designer checks, etc.

Buying a Car

Buy or Lease?

• Compare lenders to determine loan options.
• Different loan rates exist for new and used cars.
• Independent research allows you to compare market loan interest rates with dealer financing.

Negotiation

There are Three Separate Negotiations: 

• Price of the car you are purchasing.
  • Thoroughly research invoice price, hold backs and other dealer incentives.
• Ask for the “out the door” price (all costs included).
• Avoid purchasing dealer extras such as rust proofing, teflon and fabric coating, and dealer security systems which are often overpriced.

Price of Your Trade-in

• Thoroughly clean your trade-in.
• Check on the web to find its approximate value.
• Offer it for sale to used car dealers to find its wholesale price prior to negotiations.
• Selling it yourself to a 3rd party (not a dealer) may earn you more money.

Financing the Loan

• Compare dealer rates with rates obtained from other lenders.
• Never take the purchased car home if the lending terms are conditional.
• Don’t finance a car with balloon payments or prepayment penalties.

Research Resources

Websites

Books

Buying a Home

Buying your home will probably be the biggest purchase you will make. First time home purchasers need to spend time researching in order to do it right! Mistakes can cost you thousands of dollars and can even result in losing the home to foreclosure. Below are some basic points to help you start your research for your home purchase.

Identify your needs

Location, location, location – proximity to work, shopping, restaurants, schools, hospitals, churches, airports, parks, friends and family as well as safety, quality of schools and zoning restrictions

Type of home – new vs. old; well maintained vs. “fixerupper”; single-family vs. condominium/townhouse; country/suburbs vs. urban; one story vs. two story/split level; number of bedrooms and bathrooms; square footage.

Lifestyle – Who is going to live in the house? What are you going to be doing in the house? Do you have pets? Will you be traveling frequently? Can you afford to buy?

Down payment – Larger down payments result in smaller mortgage payments and less total interest paid. If you have a 20% or larger down payment, you won’t have to purchase private mortgage insurance (PMI). PMI protects the lender.

Closing costs – Various costs in completing the purchase. Typically 2%-4% of the house purchase price. Often can be added to the mortgage.

Principal, Interest, Taxes, Insurance (PITI) & maintenance – You will be required to pay back the mortgage with interest. There will be yearly property tax payments due to the local government. The lender will also require that you purchase home owner’s insurance to protect against fire or other loss. You will also be responsible for your own house repairs such as plumbing or electrical. If you live in a condominium or townhouse, you may have monthly maintenance fees for common areas.

Important factors in obtaining a mortgage

Income – Many lenders follow the 28/36 rule: PITI should not exceed 28% of gross monthly income (GMI) and overall debt should not exceed 36% of GMI.

Credit Score – Obtain free annual credit reports from annualcreditreport.com. You can also obtain your credit scores at myfico.com.

Down payment – the larger the down payment, the less risk for the lender.

Other assets - Mutual funds, stocks, bonds, savings or checking accounts that would be available to be converted to a mortgage payment if needed. You should have at least 6-8 months of expenses saved in an emergency fund.

Main types of mortgages

Fixed-rate mortgage – Borrower pays the same amount every month typically for 15 or 30 years. This is the safest choice for most people.

Adjustable-rate mortgage (ARM) – Low initial interest rate for a short period of time (often 1 or 2 years). Rate fluctuates after initial period, usually every year. Typically there is a 2% yearly increase cap and a 6% total increase cap. ARMs are more risky for you than a fixed rate loan.

Hybrid (Hybrid ARM) mortgage – Initial interest rate is lower than fixed rate. Initial rate period is fixed for 3, 5, 7 or 10 years. Rate fluctuates (becomes ARM) after initial period. May be an option if you know you will be moving within the initial rate period.

Other mortgage considerations

VA (Department of Veteran Affairs) Loans - VA guarantees part of the loan. Visit homeloans.va.gov.

Federal Housing Administration (FHA) Loans – FHA guarantees part of the loan. Visit hud.gov.

Escrow (Impound) Accounts – The lender will probably pay your taxes and home owner insurance to ensure that these costs are paid. Usually, lenders add an estimated cost to your monthly mortgage payment to cover the taxes and insurance costs. Remember, your payments could increase even for a fixed-rate mortgage if you have an escrow account and your property taxes or home owner insurance increases.

Points – A point is 1% of the loan balance. Banks often allow borrowers to purchase points in order to reduce the interest rate of the loan. Whether you decide to purchase points usually depends on the amount of interest rate deduction for each point, the length of time you plan to live in the house and whether you plan to refinance.

Prepayment penalty - Avoid mortgages that charge you when you make early payments on your mortgage principal.
Tax advantages – Mortgage interest and property taxes are normally tax deductible from gross income. See a competent accountant to determine other possible deductions.

Prequalified vs. Preapproved – Prequalification requires you to give income and debt estimates to the lender who then gives you an estimate of what you can borrow. Preapproval requires you to provide documentation such as pay stubs, tax returns, proof of other income & assets and information of current debts. The lender will then provide you a written commitment to loan you money. There is usually a charge for the preapproval process.

Assembling YOUR Team

Real Estate Agent – Most important member of your team. You will want an agent with experience, professionalism and integrity. Seek referrals and track neighborhood signs. Interview at least 3 agents. Check licenses and references, especially if the agent is independent. Agents receive a commission normally paid by the seller of the house. Recommend that your agent be a “buyer’s agent” who will represent you. The agent can explain the entire purchasing process to you, find prospective homes, accompany you during home visits, research comparable sales data, provide advice during negotiations, draft written purchase offer, open escrow account, recommend others to be members of your team, coordinate activities prior to closing, ensure you receive explanations of all required documents and answer questions about the community after the purchase.

Lenders – Banks and Savings & Loans provide loan options to eligible borrowers. Borrowers can also review rates at bankrate.com.

Mortgage brokers – People who shop around at different lenders to find the best deals. Brokers receive payments from lenders. Select a mortgage broker by referrals from people you trust.

Real Estate Attorney – Select an attorney experienced in home purchases. The attorney will help you review the sales contract to ensure legal compliance, complete the title search and explain all the documents you are signing during closing. Make sure you receive a cost estimate and agreement that the attorney will contact you if expenses will exceed the estimate.

Property Inspectors – Inspectors inspect the inside and outside of the home for structural and mechanical defects. The inspector will not repair problems but will recommend solutions which your real estate agent can relay to the seller’s real estate agent. Choose one who is experienced and licensed by the American Society of Home Inspectors. Accompanying the inspector during the inspection gives you an opportunity to learn about your new home.

Pest inspector – Pest inspections are separate and will look for damage due to insects such as termites or beetles.
Closing Agent – The closing agent can obtain the title report and coordinate title insurance; prorate taxes, insurance and loan interest; hold earnest money in a separate account, pay recording fees and taxes; coordinate all required closing paperwork; transfer and record the deed; and transfer your payment to the seller.

Insurance Agent – Before the purchase is complete, the lender will require that you have a home owner insurance policy in place which will cover the dwelling (cost to rebuild home), personal property (loss of your possessions), and liability (protects you financially if accidents occur on your property). Make sure that you understand what hazards are and are not covered. Separate policies against flood, earthquake and some other hazards not normally covered under home owner insurance are available if you want them.

Credit Cards

Credit cards are a convenient alternative to carrying large amounts of cash and are useful in making needed payments for emergencies. Credit cards also allow users to purchase necessities and repay over time. Many credit card users get into trouble because they do not see the cash being spent from their wallets. Users often spend more than they can afford to repay.

Using Credit Cards

Using a credit card acts as a small loan. Credit card companies agree to lend you money with the promise of being repaid at a later time. You borrow money to purchase items and then receive a bill from the lender each month. The bill contains the total amount owed as well as the minimum payment due. You must pay at least the minimum amount due each month to avoid negatively affecting your credit history. If you do not pay back the entire balance owed by the due date, you will often find that a high interest rate will be charged on the unpaid balance. In order to avoid large interest expenses, you should pay back borrowed sums as soon as possible. The best practice is to pay off the entire balance each month. By responsibly using a credit card, users can build credit history that will help lower future mortgage and other loan rates.

Credit Card Fees

In addition to the interest rates, credit card lenders charge other fees that you should try to avoid.

Annual Fee: Some lenders charge an annual fee just for issuing the credit card. The annual fee is typically shown on the first statement and charged again each year that you have the card.
Late Fee: If you miss making at least the minimum payment by the monthly due date, you will be charged a late fee.
Over-the-Limit Fee: Credit card lenders set a maximum amount you are allowed to charge on your credit cards. For new credit cards, you must authorize the lender to allow you to go over your limit or the lender is not allowed to charge this fee. Without your authorization to go over the limit, purchases attempting to exceed the limit will probably be denied. If you exceed the limit, you will receive over-the-limit fees each month your balance due remains over the limit.

Credit Card Terms

Annual Percentage Rate (APR): The interest rate determined on a yearly basis that is charged on the unpaid balance. The APR is the best interest rate to use in determining credit card costs.

Credit Balance: The total amount of charges on a card that has not been paid.
Credit Limit: The maximum balance allowed.
Minimum Payment: The minimum amount that must be paid to avoid late fees

Credit Card Tips

• Try to pay the entire balance due each month, but ALWAYS pay at least the minimum payment due.
• When applying for a credit card, take your time and shop for the best deal. Check out bankrate.com for more information.
• Try to obtain a card with a low APR and no annual fee.
• Check your credit card agreements to make sure you know the interest rate you are being charged.
• If any of the following apply to you, you should consider seeking assistance from your family or the Money Education (ME) Center:
  • Using one card to pay the bill of another card
  • Near the credit limit of several cards
  • Can only afford to pay the minimum amounts due o Have been declined from making a purchase
  • Losing sleep due to credit card debt anxiety

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Credit Scores

Understand the importance of maintaining a high credit score and how these scores are determined. Credit scores help lenders predict whether loan applicants will repay their loans. Your credit scores affect whether you will be approved to receive credit and the interest rates you will pay for credit cards, mortgages, auto loans and other types of loans. Attaining and maintaining high credit scores enable you to borrow money more easily and can save you money through lower interest rates.

How to Get Your Credit Report

Credit scores are based on payment history contained in credit reports. Paying your bills on time will improve your credit scores while making late payments or defaulting on loans will lower your scores. The agencies that collect these reports are called credit bureaus. There are three credit bureaus:

• Equifax equifax.com Phone 1.888.202.4025
• Experian experian.com Phone 1.888.397.3742
• TransUnion transunion.com Phone 1.855.681.3196

These bureaus collect your information and sell it to lenders to give them a better picture of what kind of borrower you are. Each of the three credit bureaus will have a different credit history based on the information sent to it by your creditors. Prospective employers and landlords also have access to these reports.
You can request a free copy of your credit report annually from one or all three of the credit bureaus from annualcreditreport.com. You should order your report and review it for errors. If you find an error, notify the credit bureau, who then processes your dispute. The credit bureau should either resolve your dispute or provide you with contact information of the business submitting the erroneous information. The business must share information with you and promptly investigate the disputed information. It is extremely important that you ensure that your credit history is correct because it is the basis for determining your credit score.
Insurance Companies Many insurance companies use proprietary credit scores when determining the premium charged to customers. The insurance companies have found that there is a direct link between the credit scores and the probability of customers filing claims. Keeping your credit scores high can save you money on the amount of premiums you pay for car insurance and other types of insurance.

Tips for Improving Your Scores

• Try to pay your entire credit card balance each month but ALWAYS pay at least the minimum amount due each month.
• Keep total amount of debt as low as possible. 
•  Ensure you pay rent, utilities and all other bills on time.
• Check your credit report regularly for accuracy and report any errors immediately.
• Make excellent credit management a priority in order to develop a long record of success.

Your FICO Score

The most commonly used credit score is the FICO score. The FICO score was developed by Fair Isaac Corporation. FICO scores range from 300-850 with most of the scores falling between 600 and 800. Here is the formula that is used from your credit report to determine your FICO score:

1. Paying your bills on time - 35% Paying your bills late can hurt your score while paying on time helps your score. Make sure that you always pay at least the monthly minimum amount due on all of your credit cards.
   
   
2. Debt to credit ratio - 30% Ratio of your credit card balances to credit limits. The lower you can keep your outstanding balances, the higher your FICO score will be.
   
   
3. Length of Credit History - 15% The longer you can show that you manage credit wisely, the better your credit rating will be.
   
   
4. New Credit - 10% Users opening new credit accounts should do so a few at a time. FICO scores distinguish between applying for one loan and applying for multiple loans. Multiple inquiries can hurt your score, so avoid opening multiple cards within short periods of time. If you are comparing lenders for a single loan, try to make all of your applications within a short period of time (such as two weeks) so that your FICO score will count this as only one loan.
   
   
5. Credit Mix - 10% A mix of forms of credit can also add to your credit score. Those with mortgages, school loans and credit cards can help their credit score with these diversified forms of credit.

By law, credit scores may not consider race, color, religion, national origin, health status, sex or marital status. Students should shoot for a score of at least 760. You can obtain your FICO scores at www.myfico.com. There is a charge of about $60 to obtain your FICO scores from all three of the credit bureaus. Mortgage lenders generally use all three FICO scores in making their lending decisions while car lenders often use only one.

Identity Theft

Learn how to protect your identity and what to do if you become a victim of identity theft.

Most Common Types of Identity Theft

According to the FTC’s 2017 Consumer Sentinel Network Report

1. Credit Card Fraud
2. Employment or Tax-Related Fraud
3. Phone or Utilities Fraud
4. Bank Fraud
5. Loan or Lease Fraud
6. Government Documents or Benefits Fraud

How to Protect Yourself from Identity theft

Computer

• Make sure you have an up-to-date firewall, virus protection software, and anti-spam or spyware program.
• Never download files or click on links that look suspicious.
• Make sure you are using a secure browser when online shopping, banking, or sharing personal information.
• Make sure you use strong passwords with letters, numbers, and symbols.
• Have different passwords for different accounts.

Banking

• Check your bank accounts and credit cards frequently for errors.
• Check your credit reports regularly on AnnualCreditReport.com

Physically

• Invest in a shredder and never put any sort of personal information or banking information in your trashcan without shredding it.
• Be very careful when giving out personal information.
• Ask how they will be using your information and be wary of someone eavesdropping or looking over your shoulder.
• Make sure you lock and passcode protect your phone

What should you do if your identity is stolen?

1. Contact security or fraud departments for each company to dispute charges and stop payments
2. Change all logins, passwords, and PINs
3. Place a fraud alert and get your credit reports
4. Close fraudulent or tampered with accounts
5. Report identity theft to the FTC (1.877.438.4338)
6. File a police report
7. Keep documentation of everything that you do!

Visit identitytheft.gov for step by step instructions, to report identity theft, create an affidavit, and come up with a personalized recovery plan.

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Are you at risk of identity theft?

___ I carry my Social Security card in my wallet. (10 points)
___ I use a computer and do not have up-to-date anti-virus, anti-spyware, and firewall protection. (10 points)
___ I do not believe someone would break into my house to steal my personal information. (10 points)
___ I have not ordered a copy of my credit report for at least 2 years. (20 points)
___ I use an unlocked, open box at work or at my home to drop off my outgoing mail. (10 points)
___ I do not have a P.O. Box or a locked, secured mailbox. (5 points)
___ I do not shred my banking and credit information, using a cross-cut “confetti” shredder, when I throw it in the trash. (10 points)
___ I throw away old credit and debit cards without shredding or cutting them up. (5 points)
___ I use an ATM machine and do not examine it for signs of tampering. (5 points)
___ I provide my Social Security Number (SSN) whenever asked, without asking why it is needed and how it will be safeguarded. (10 points)
___ Add 5 points if you provide it orally without checking to see who might be listening nearby.
___ I respond to unsolicited email messages that appear to be from my bank or credit card company. (10 points)
___ I leave my purse or wallet in my car. (10 points)
___ I carry my Medicare card in my wallet at all times, it displays my SSN. (10 points)
___ I do not believe that people would root around in my trash looking for credit or financial information or documents containing my SSN. (10 points)
___ I do not verify that all financial (credit card, debit card, checking) statements are accurate monthly. (10 points)

Add points to determine your score.

Understanding Your Score:

90+ points    Recent surveys indicate that 17-18 million people are victims of ID theft each year. You are at high risk.
40-89 points Your odds of being victimized are about average.
0-39 points   Congratulations! You have a high “IQ.” Keep up the good work and don’t let your guard down now.

Investing

This information is provided for general information only. No specific investment recommendation is intended or implied. Students are urged to seek the advice of a professional before taking action on their investments.
 
The first step in obtaining wealth is establishing an investing plan that is right for you. Here are some things to consider when developing your own plan:v

Index Funds

Passively managed, low-expense funds that seek to mirror the result of a market index (S&P 500 or S&P MidCap 400). Index funds attempt to replicate stocks in the index. It is common for a large percentage of actively managed mutual fund results to fall below their benchmark index. Index funds are easy to buy and provide:

• Diversification
• Low expenses
• Low minimum investments
• Possible tax advantages In order to start saving and investing, you need to “pay” yourself first: Participate in your employer’s retirement plan at least up to the amount it will match.
• Examples: 401K and 403B
• Usually have several investment choices
• Pre-tax investments grow tax-deferred Contribute additional funds to a Roth IRA.
• $5,500/yearly limit on earned income ($458/ month)
• Contributions are after-tax
  
  

Withdrawals are TAX-FREE after age 59 ½ An IRA is flexible – within the same account, you can have stocks, bonds, mutual funds, cash, CD’s, and money-markets It will be up to you to decide whether you have the time and interest to manage your investments, or need to hire a professional such as a CFP® or investment broker to assist you.

Income Investments

Loan money to an entity (bank, corporation, state or local government, or federal government) and in return they promise to pay interest for a specified time period and return your principal at maturity. Examples of these investments include certificates of deposits (CDs), saving bonds, municipal bonds, treasury bonds and corporate bonds. The degree of risk on income investments vary from virtually no risk on U.S. treasury bonds to high risk on high yield (junk) corporate bonds. For CDs and U.S. federal bonds, these investments provide regular income, safety of principal and possible tax advantages. Stocks represent ownership in a company. When you purchase shares of stock, you are purchasing shares of that company. Stock investments make money by the appreciation of the share price and dividends. Dividends are payments the company makes to the shareholders from its earnings and profits. The dividends can be reinvested back into the stock for more growth and share accumulation.

Growth & Income Stocks

Loan money to an entity (bank, corporation, state or local government, or federal government) and in return they promise to pay interest for a specified time period and return your principal at maturity. Examples of these investments include certificates of deposits (CDs), saving bonds, municipal bonds, treasury bonds and corporate bonds. The degree of risk on income investments vary from virtually no risk on U.S. treasury bonds to high risk on high yield (junk) corporate bonds. For CDs and U.S. federal bonds, these investments provide regular income, safety of principal and possible tax advantages. Stocks represent ownership in a company. When you purchase shares of stock, you are purchasing shares of that company. Stock investments make money by the appreciation of the share price and dividends. Dividends are payments the company makes to the shareholders from its earnings and profits. The dividends can be reinvested back into the stock for more growth and share accumulation.

Mutual Funds

An investment company that allows investors to own a diversified portfolio of stocks or other securities. The typical mutual fund will be comprised of 50- 200 stocks. These funds can invest for growth & income, growth, aggressive growth, international, and particular sectors of the economy. Mutual funds are easy to buy and seek to provide:

• Diversification
• Professional management
• Low minimum investments
• Automatic reinvestment of dividends & capital gains

Tips on Achieving Financial Success

• Have a plan
• Establish an emergency fund
• Pay yourself first
• Establish a Roth IRA
• View market downturns as a buying opportunity
• Diversify
• Find a trustworthy advisor that will educate you
• Review your plan annually

Helpful Websites

Kiplinger’s
Morningstar
CNNMoney
Smart Money
Motley Fool

Recommended Reading

The Total Money Makeover, Dave Ramsey
The Millionaire Next Door, Stanley/Danko
The Automatic Millionaire, David Bach
Common Sense on Mutual Funds, John Bogle

Love and Money

Money is one of the main causes of marriage problems. Learn the money topics couples can discuss prior to marriage in order to help avoid problems after the wedding.

Financial Topics of Discussion Before Marriage

Saver vs. Spender – Money attitudes are deeply imbedded based on a person’s background. Some people tend to be “savers” who value security while other people tend to be “spenders” who value spontaneity and immediate gratification. Listening to your partner’s background will help you understand your partner’s attitude toward money. If both persons are spenders, a budget needs to be established immediately!

Current Debts – Each person should come forward with any debts before the marriage. Telling your spouse of previous debts after marriage can lead to a loss of trust. Discuss the reason for the debts. If debt was caused by extravagant spending, discuss methods of preventing future debt. Discuss a plan for repaying the debt. Don’t be ashamed of student debt!

Credit Scores – Your credit scores will be important when trying to obtain a mortgage or other loans. Both of you should obtain your annual free credit reports at annualcreditreport.com. The credit report contains a credit history of previous loans and payment history. If there are errors in the credit report, you should have them corrected. Once the credit report is correct, you may want to order credit scores which use the credit report to determine a numerical score. The most commonly used credit score is the FICO score which was developed by the Fair Isaac Corporation. FICO scores may be purchased at myfico.com. The score results should be discussed, especially if the scores are low. No FICO score simply means the person probably has never had any debt.

Financial Goals – Each spouse should write down individual dreams, both short-term and long-term. Examples may be to purchase your dream home, save one million dollars or take a special anniversary trip (to an exotic island of your choosing.) Both spouses’ dreams should be merged and a plan established to set goals both will work to achieve. A specific saving and investing plan can help achieve your goals. Financial goals should be reviewed at least annually and modified as needed.

Wedding Planning – The process of working as a team in order to achieve a successful goal often begins with the wedding planning. Couples should ask themselves the following questions during the planning process:

• What are our priorities?
• What type of a wedding do we want?
• How large of a wedding do we want?
• How much can we afford?
• Who will be paying for what?
• Are we putting a financial strain on our parents?
• How long will it take to pay back any debts?
  
  

A wedding worksheet is available to help with setting the budget and determining the payment responsibilities. The best plan is to save and pay cash for the wedding so there won’t be any debt afterwards. If there will be debt, couples should make a plan to pay all debt within one year. Taking longer than a year will delay achieving future financial goals.

Financial Responsibilities – Couples should agree on how they will track spending and who will pay the bills. Try to use each other’s strengths in dividing responsibilities. Many bills can be paid by automatic payment. Couples also need to determine how savings and investing will work. Many couples have success with their investing by having money for investments sent automatically before the funds can be spent on other items. Set time for a monthly scheduled meeting to discuss spending, savings and investments. Both of you should participate in financial decisions.

Insurance Needs – The need for life insurance likely will increase after marriage. You probably want to make your spouse the beneficiary of any existing life insurance policies. Life insurance requirements rise significantly once you have children. Term life insurance is an inexpensive option for many couples. Health insurance is absolutely essential to cover medical needs. Make sure you have a policy to cover future medical problems you may have. You also may want to look into disability insurance to pay for bills should either spouse be incapacitated for a significant amount of time.

Prenuptial Agreement – A prenuptial agreement is a contract between two people planning to be married that specifies how property will be distributed should the couple divorce. If a couple decides on a prenuptial agreement, it’s recommended each partner hires his/her own attorney. As part of the prenuptial agreement, each partner will disclose the full amount of income, assets and debts. These agreements are especially useful if either partner owns significantly more assets than the other partner, has children from a prior marriage, owns a business or is in a partnership, is likely to earn a hefty salary in the future, or is paying for their partner’s advanced degree.

Spending Plan (Budget) – A couple needs to develop a written spending plan that works for both of them. Track expenses for a month and establish a plan together. Review the plan at least once a month. Establish an emergency fund that will cover 3-6 months of expenses. Each person needs a “no questions asked” portion of the budget where they can spend money on anything (as long as it is not illegal or immoral). This may be a small amount in some budgets, but it is important to have some money set aside for this category.

Investments – The earlier you can start investing your money, the sooner you can take advantage of the miracle of compound interest. Try to “pay yourselves first” through automatic deposits. This money will be automatically invested before you have a chance to spend it on other items. Set a goal of investing 10%-25% of income. If both partners are working, try living on one income and investing the other. Consider investing in Roth IRAs which allow investments to grow tax-free and be withdrawn tax-free provided certain provisions are met. If you and your spouse invest $8000 at the beginning of every year and your investments average a 9% return, you will be millionaires in just over 28 years.

Legal Documents – Make sure you both have an updated will along with a financial power of attorney, healthcare power of attorney, living will and any other legal documents you may require. Hiring a professional - Consider hiring a fee-only CFP® who can assist you with decisions on housing; the amount needed to invest in order achieve financial goals; debt repayment plans; mutual funds, index funds and other investment options; insurance needs; and methods of completing wills and other legal documents.

Financial Aid – After you are married, you can file the Free Application for Federal Student Aid (FAFSA) as an independent student. As an independent student, you will report your and your spouse’s income and assets. If you have already filed the FAFSA as a dependent student, contact the Office of Scholarships & Financial Aid to evaluate whether it would be prudent to apply for a change in status.

Final Recommendations

• Work as a team to accomplish your financial goals. 
• Share financial responsibilities based on your strengths. 
• Establish a written spending plan that works for both of you. 
• Make spending and investing decisions together as a team. 
• Schedule regular meetings to review your finances. 
• Have fun watching your assets grow!

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I'm Graduating: Now What?

As graduation nears, don’t forget to prepare for the financial opportunities and challenges former students often face after graduating.

Career

Don’t have a job lined up quite yet? The Career Center can help you with the following and more:

• Updating your résumé and creating cover letters
• Job search assistance through the HireAggies job board
• Mock interviewing
• Salary evaluation and negotiation

Employee Benefits

Paid Leave Benefits: Most companies will offer paid time off for sickness, vacation and bereavement.

Health Benefits

Typically people rely on their employer for health care coverage. Most new employees are offered a health insurance package when they are first employed and then annually during an open enrollment period. There should also be separate plans for Dental/Vision insurance. If you do not sign up for health insurance right away, you will need a “qualifying life event” to enroll outside of open enrollment. With insurance, the higher the premium, the lower the out-of-pocket cost.

Traditional 401(K)

• Comes from your Pre-Tax income
• Withdrawals ARE taxed
• Contributions often matched by employer - always contribute enough to get this match
• Employer provides investment options
• Max Annual Contribution = $18,500

Roth IRA

• Comes from your Post-Tax income
• Withdrawals are NOT taxed
• This is an individual retirement account, so you are on your own to find the investment options or brokerage firm that you will work with
• Max Annual Contribution = $5,500

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Student Loans

Have student loans? 

Make sure to do the following: Determine what loans you owe, who you owe them to (your loan providers), and how to contact them.

• Federal: nsldsfap.ed.gov
• Alternative: Contact each of your private loan lenders
• State of Texas: hhloans.com
• Institutional (Texas A&M): https://sbs.tamu.edu/loans/myaggieloans/index.html

Contact each of your loan providers to:

• Update your contact information
• Set up online access to your loans and automatic payments for a possible interest rate discount
• Find out when repayment will begin and what your required payments will be
• Ask about interest capitalization
• If you are ever having trouble making payments, ask about your repayment options, including other repayment plans, as well as deferment and forbearance.

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Cost of Living: Moving Away from College Station?

There are some things you should consider with the cost of living in your new city. Keep in mind housing will probably be your biggest expense and can be your biggest way to save! Check out a cost of living calculator to compare price differences in groceries, housing, utilities, transportation, and health care.

Moving Expenses

According to the American Moving and Storage Association, the average cost of a total move is $2,300 and the average cost of a long distance move is $4,300. Factors that will affect this cost include: distance of move, amount & weight of items being moved, the time of year, labor costs, and any insurance coverage.