MONEY Debt

Have You Conquered Debt? Tell Us Your Story

Have you gotten rid of a big IOU on your balance sheet, or at least made significant progress toward that end? MONEY wants to hear your digging-out-of-debt stories, to share with and inspire our readers who might be in similar situations.

Use the confidential form below to tell us about it. What kind of debt did you have, and how much? How did you erase it—or what are you currently doing? What advice do you have for other people in your situation? We’re interested in stories about all kinds of debt, from student loans to credit cards to car loans to mortgages.

Please also let us know where you’re from, what you do for a living, and how old you are. We won’t use your story unless we speak with you first.

TIME Thailand

And Then There Was the College Lecturer Who Gave Out Grades in Return for 7-Eleven Coupons

Inside A 7-Eleven Store Ahead Of CP All Pcl Full-Year Results
A customer exits a 7-Eleven convenience store, operated by CP All Pcl, in Bangkok, Thailand, on Wednesday, Feb. 19, 2014. Dario Pignatelli—Bloomberg/Getty Images

“She might have thought it was ordinary practice,” said her boss

A university lecturer in Thailand has been caught offering top grades in exchange for 7-Eleven coupons, or stamps, redeemable at the convenience store chain for small gifts or discounts.

When a class at Kalasin Rajabhat University, in northeast Thailand, complained to the lecturer about the selling of test scores, she rebuked them, and someone in class filmed her doing so.

From the conversation, it appears that 25 coupons earned a one-grade bump, with one student shelling out 400 coupons for an A+, reports the Bangkok Post.

“Khanittha got 17 points in psychology class. She gave me stamps,” the teacher says on the video. “Then, I gave her A+. Do you think you got that grade by your own brain?”

Thailand boasts some 7,000 7-Elevens nationwide — the third-largest presence for the chain after Japan and the U.S.

On Tuesday, the Council of Rajabhat University Presidents of Thailand — known by its unfortunate acronym CRUPT — ordered an investigation.

“Teachers should never exploit their students for any purpose,” said CRUPT president Niwat Klin-Ngam.

Despite suspending the lecturer, who worked for the university’s pre-school education department, acting Kalasin Rajabhat University rector Nopporn Kosirayothin said there may be extenuating circumstances.

“She might have thought it was ordinary practice,” he said. “Judging from what I heard, some lecturers at other places also exchange grades for some beer.”

[Bangkok Post]

TIME Innovation

Five Best Ideas of the Day: July 15

1. With the $3 billion annual cost of fighting piracy at sea, we could invest in economic and infrastructure development on the Somali coast to take down piracy’s root causes.

By Anja Shortland and Federico Varese in The Conversation

2. Simply by letting students understand their financial aid picture earlier, we can improve college access and post-secondary options for low-income students.

By Fawn Johnson in National Journal

3. The story of ISIS, which has seemed to be all about religion and military developments, is actually mostly about politics: access to government revenue and services, a say in decision-making, and a modicum of social justice.

By Jessica Tuchman Mathews in the New York Review of Books

4. Giving a supercomputer “life after retirement” means investing in the future of technology in Africa.

By Jorge Salazar at the Texas Advanced Computing Center, UT-Austin

5. Europe has a role – and a responsibility – to stay engaged as the U.S. ‘rebalances’ toward China.

By Joseph S. Nye in Project Syndicate

The Aspen Institute is an educational and policy studies organization based in Washington, D.C.

MONEY College

Two New Proposals Would Make College Free Nationwide

140715_HO_FreeCollege_1.jpg
Michael Burrell / Alamy

With student loan debt crippling students, education advocates are suggesting ways to change how federal financial aid money is distributed.

Adele Williams often hears her friends from high school talking about their struggles to afford college.

But she can’t relate—she doesn’t pay any tuition at all. At the school she attends, Alice Lloyd College in Kentucky, students attend for free in exchange for working.

Her friends at other schools, she says, “are mostly jealous.”

At a time when the cost of attending many private colleges exceeds the national median household income, the idea of paying no tuition at all seems so unrealistic that one higher-education economist refers to it as “la-la land.” But there are a handful of schools—such as Alice Lloyd and others—that don’t charge students a penny. Meanwhile, Tennessee will make all of its community colleges free for state residents beginning next year, and Oregon is moving forward with a study considering the same thing.

Now two new proposals go even farther, both aiming to make no-cost college a nationwide standard. A report from the Lumina Foundation recommends that the first two years of public universities and colleges be free, and a new nonprofit called Redeeming America’s Promise has come out with a proposal to give every lower- and middle-class student a full ride.

“The rising millennial generation has been so deeply affected by student debt that they’re driving a conversation about this challenge,” says Morley Winograd, the president of Redeeming America’s Promise, who worked as an advisor to Vice President Al Gore during the Clinton Administration. She added that “well-meaning but what I would call Band-Aid solutions” aren’t enough to fix the problem.

Existing financial aid was created to help the lowest-income students at a time when middle-class and wealthier families had little trouble paying for college on their own, notes University of Wisconsin-Madison sociologist and higher-education policy expert Sara Goldrick-Rab, who co-authored the other proposal. “But the people who are struggling to pay for college today go way beyond poor people,” she says. “There’s a need for a universal program.”

The Full Ride Proposal

Redeeming America’s Promise proposes redirecting existing federal and state financial aid and tuition tax breaks to give full tuition scholarships in specified amounts. It says the amount of money the government already spends for those purposes is enough to provide $2,500 per academic year for community college and $8,500 for four-year universities to every student from a family earning $180,000 a year or less.

That would just about cover the entire average advertised full cost of public college and university tuitions for everyone, the organization says.

Under the plan, which is backed by several Republican and Democratic former governors, Cabinet members, and members of Congress, the students could take out loans to cover their living expenses and repay them based on their incomes after graduation.

The scholarships would be limited to two years for an associate’s degree and four years for a bachelor’s degree to encourage students to graduate on time—which only a fifth of those at four-year institutions currently do and 4% at two-year schools.

Colleges and universities generally wouldn’t be allowed to raise their prices higher than the scholarship amounts, forcing them to control their costs.

The 50% Plan

Goldrick-Rab and her colleague, Nancy Kendall urge in their report that the billions of dollars in federal financial aid money and some state money be redirected to make tuition, fees, books, and supplies free for the first two years of any two- or four-year public university or college and that students be given stipends and jobs to help them pay their living expenses.

Goldrick-Rab and Kendall call this the free two-year college option, or F2CO.

The Reality Check

The Redeeming America’s Promise scholarships would cover the full cost of tuition at public universities and colleges not private ones, the influential lobbies of which are likely to oppose the idea on the grounds that it would divert students from them.

But public institutions might oppose as well, on the basis that the plan would be a form of price control or that they wouldn’t be able to handle, at the amount they are allowed to charge, the flood of students projected to descend on them. Tennessee universities opposed making community colleges free in that state, for example, until lawmakers agreed to make some changes in funding for them.

“We had four-year schools that were going, ‘Wow, it’s going to be hard for us to compete with free,’” said Tennessee Governor Bill Haslam.

And the sweeping, dramatic changes suggested in either proposal would face an uphill battle in a divided government that has been challenged to make even marginal policy decisions.

“It’s very difficult to separate the politics from the economics,” said David Breneman, a professor in the economics of education at the University of Virginia.

Breneman pronounced both free-college proposals “not realistic,” especially at four-year institutions (“That’s just La-La Land”), though he said they might stir up a helpful conversation about untangling the way the government helps students pay for college.

“When you look at what a mess we’ve made of student aid and how complicated it’s gotten and the loan craziness, it’s not surprising that people look back at those days when we just had low tuition,” he said.

Even the free-college crusaders are not optimistic about these plans being adopted in the immediate future.

“No way is it happening today,” said Goldrick Rab. “To me the question is, will enough groundwork be laid today that it becomes something groups are working on for the next 10 to 12 years, and that eventually becomes a litmus test for people we elect.”

Winograd said more states could make public colleges and universities free sooner than that, mostly without federal involvement. Advocates in some already have proposed it, and many states are watching the free-college experiment in Tennessee, where the $34 million-a-year cost is to be underwritten by a $300 million endowment paid for from lottery proceeds. (In Oregon, the annual cost is estimated at $100 million to $200 million.)

“The political will to do it does exist, not necessarily in Washington, but throughout the country,” Winograd said.

__________

This story was produced by The Hechinger Report, a nonprofit, nonpartisan education-news outlet based at Teachers College, Columbia University.

Related stories:

Colleges try to speed up pace at which students earn degrees

Testing your way to a degree

Residents are crowded out of college by out-of-state and foreign students

Just as it wants students to speed up, government won’t pay for summer courses

MONEY College

How to Judge a College By Its Career Services Office

ESPN "This is SportsCenter" campaign with Bucky the Badger, the official mascot of the University of Wisconsin–Madison, by Wieden+Kennedy.
Will your child's dream school land him his dream cubicle? Wieden+Kennedy

The placement office is now one of the most important stops on the campus tour.

With loan-burdened students and parents increasingly demanding that a BA lead to a J-O-B, colleges are beefing up their placement services. This year, for the first time since the financial crisis, the typical career office—which has struggled with caseloads of about 1,500 undergrads per staffer—­enjoyed a boost in operating budget instead of a cut, the National Asso­ciation of Colleges and Employers (NACE) reports. “We’re about to experience the golden era of career services,” says Thomas Devlin, director of UC Berkeley’s career center.

To ensure that gold enriches your kid’s job search, look for colleges with good answers to the following questions. Just be sure to temper sales spiels with feedback from students and alumni, plus data from sources like Payscale.com.

How is the office staffed? The best career offices have caseloads of fewer than 1,100 undergrads per counselor, allowing at least one staff hour per student per year. Expertise matters too. “It’s a bad signal if a school doesn’t have someone dedicated to encouraging employers to recruit,” says Andy Chan, vice president of career development at Wake Forest. Each office should also have a person who specializes in connecting students with alumni, as well as an expert in technology and social media (like LinkedIn).

What services are offered? Employers prefer to recruit at campuses where students come to interviews prepared and book meetings only for jobs they’d actually consider, says Dan Black, president of NACE and Americas director of recruiting at professional services firm EY. So confirm that the school works with students one-on-one to narrow the
ir career focus and coaches them for interviews, he says. And ask if there are formal ways of networking with alums, like shadowing or mentoring; if academic departments also work on career skills; and what help is offered to grads, whether it’s simply job listings (eh) or counseling (better).

When does career prep begin? Studies show that the sooner students start working on career preparedness, the better they do in the job market. Ideally, the college will be equipped to work with students during their first or second year. Since underclassmen tend to steer clear of career services, though, some schools are experimenting with ways to motivate young’uns to think about vocations. Willamette University, in Salem, Ore., for example, requires freshmen to create a résumé before registering for sophomore classes.

Are internships a priority? On-campus recruiting by prestigious employers is definitely a good sign, but few undergrads get jobs that way, says Bob Orndorff, associate director of employer relations at Penn State. Meanwhile, at least 24% of internships lead to job offers, NACE reports. “Employers are looking for recruits with rele­vant experience,” Orndorff says. So find out how the school helps arrange internships and what percentage of students get them. The more students doing paid internships, especially, the better.

Hire Ed

___________

WATCH: Was your college’s career services office any help?

MONEY 101: How to start saving for college

MONEY College

22 Colleges Where You Can Earn a Degree for Free. Seriously.

Deep Springs College, California
At Deep Springs College in California, students pay their way by working on the ranch. Brian L. Frank—Redux

You'll never have to take on a student loan at these schools.

A few new proposals are calling for making college free nationally—either for two years or all four. But experts say it could be some time before we can entirely say goodbye to tuition bills on all schools across the nation.

In the meantime, there are some places where college is already free, either for all students or those who fit certain criteria. So if you want to avoid ever signing your name to a student loan, you might add these schools to your list.

Programs that make students earn their keep: Those enrolled at Alice Lloyd, Berea, and Deep Springs colleges work to pay their full tuition—at Deep Springs, on the school ranch and farm.

Programs that reward locals. A program called Tulsa Achieves offers every high school graduate from Tulsa County, OK with at least a “C” average a full ride on tuition and fees at a local community college, local tax revenue. A local oil company pays all tuition and fees at any college or university for graduates of El Dorado High School in Arkansas. And anonymous donors do the same thing for students who attend public kindergarten through high school in Kalamazoo, Mich., and go on to a Michigan public college or university.

Programs that reward service: The U.S. military, Navy, Air Force, Coast Guard, and merchant marine academies charge no tuition for students who are accepted and serve a military term or time at sea. CUNY’s Teacher Academy gives a gratis education for education students who graduate and teach at least two years in the New York City public schools.

Programs that seek talent: The Curtis Institute of Music is free for students who pass a demanding audition, and Webb Institute for a handful of the most promising engineering students. The Macaulay Honors College at the City University of New York waives tuition for applicants who can meet the tough admissions requirements—including an “A” average in high school.

Programs with a religious bent: Barclay College, a bible college, is an example of a religious school that is free.

Programs that recognize need: Very highly selective universities with big endowments have also acted in the last several years to make tuition free for students from families with certain incomes—MIT for families that earn $75,000 or less, Harvard and Yale $65,000 or less, and Columbia, Cornell, Stanford, Duke, Brown, and Texas A&M $60,000 or less.

__________

This story was produced by The Hechinger Report, a nonprofit, nonpartisan education-news outlet affiliated with Teachers College, Columbia University.

Related stories:

Colleges try to speed up pace at which students earn degrees

Testing your way to a degree

Residents are crowded out of college by out-of-state and foreign students

Just as it wants students to speed up, government won’t pay for summer courses

MONEY Student Loans

WATCH: Why Illinois is Suing Over Student Loans

Illinois is suing debt consolidation companies for allegedly fraudulent student loan practices.

MONEY Budgeting

3 Ways to Inflation-Proof Your Life

140710_HO_Inflation_1
Jason Hindley

The official inflation rate is low, but your personal CPI may be high. Keep it grounded with these moves.

Since the Great Recession, inflation has been unusually low, inching along at well below the 3% historical average. And over the past 12 months, the consumer price index has clocked in at a ho-hum 2.1%. But you are not the U.S. economy, and the costs of being you haven’t stagnated.

In some cases, that’s a good thing. If you’re in the market for a new TV or computer, for instance, you’ll pay dramatically less than you would have five years ago (see chart, below). Yet during the same period, prices of many of the biggest and most common expenses families pay, from child care and health care to key grocery items, have shot up. Meanwhile, in real terms, salaries are stuck in molas­ses, so consumers have roughly the same income as they did before Lehman Brothers collapsed.

Use these moves to keep price increases from eroding your paycheck.

Costs of Raising Junior

Strategy: Let Uncle Sam help. Diapers, summer camp, and orthodontia may be budget killers. But the biggest strain on parents comes from two expenses: child care (up from an average $87 a week in 1985, adjusted for inflation, to $148 now) and college (tuition and fees for state schools: up 27% in real terms since 2008).

Tax breaks can help you reduce those costs. Got children under 13? Sign up at work for a dependent-care flexible spending account to use pretax dollars to pay for up to $5,000 of child-care bills, says J.J. Burns, a Melville, N.Y., financial planner. That saves you up to $1,400 in the 28% bracket.

Your company doesn’t offer the FSA, or your costs exceed the limit? Claim the child-care tax credit on your 1040 for up to $3,000 in bills for one kid, $6,000 for two. A married couple filing jointly with adjusted gross income (AGI) over $43,000 can write off 20% of bills up to these amounts.

As for college, saving via your state’s 529 plan may put money back in your pocket, says Savingforcollege.com founder Joseph Hurley; check “What’s the Best 529 Plan for Me?” to see if that’s true for you. Contributions grow tax-free and are fully or partly deductible in 34 states and D.C. (withdrawals are tax-free in every state). Plus, once your child is in school, you may qualify for the American Opportunity Tax Credit on tuition and fees worth as much as $2,500 and a deduction of up to $2,500 on student-loan interest.

Everyday Expenses

Strategy: Find a cheaper substitute. If you grilled hamburgers this Fourth of July, then you already know about skyrocketing meat prices. And that’s not all: The prices of car insurance, butter, milk, and eggs have all risen at double or triple the CPI. For gas, make that sevenfold.

Solution? Substitute a lower-cost item or supplier that can fill the same need. Trade T-bones for chicken breasts—the price of which has tracked inflation the past five years. Reach for a glass of wine (down 2% over the past five years) instead of a bottle of beer (up 9%).Then take the strategy wider. Carpool to work or use public transit to save on gas. And shop around for a cheaper auto insurer.

Health Care Costs

Strategy: Comparison-shop. Workers’ contributions to health care premiums have climbed 26% in real terms since 2008, based on data from the Kaiser Family Foundation. Prescription: Compare prices, which vary widely even in-network for doctors, services, and drugs. By logging on to your insurer’s web tool you can save thousands on MRI and CT scans, specialists, and physical therapy.

Also, to avoid big bills later, take advantage of free preventive care like physicals, which most plans must now offer, says Katy Votava, president of Goodcare.com, a health-plan consultancy. You can’t do much better than paying zero.

What's cheaper

MONEY College

$240,000 Isn’t Enough?! Why Liberal Arts Majors Are Paying Extra to Learn Job Skills

Employers want graduates who are better prepped for the work world, but colleges have been slow to respond.

Ben Wei was already paying hefty tuition to earn a sociology degree from Bowdoin College, which charged nearly $57,000 at the time. But he worried his classes weren’t teaching him skills he needed in the workplace. So he gave up the winter break of his senior year to take a three-week boot camp designed to teach him how to work a full-time job.

The $3,000 course, offered by a company called Fullbridge, covered problem-solving, collaboration and communication—the kinds of skills employers say they want but aren’t getting from college grads.

“You can sit in a room and learn economic theory from a professor or a textbook, but at the end of the day, it’s still just theory,” said Wei, who now works as a data analyst. “They don’t really teach you how to apply that theory.”

More and more programs like Fullbridge are being started up to help students master career skills before starting their first jobs, and most cost students thousands of dollars on top of the already high price of their higher educations.

That, for some critics, raises the question: Why aren’t students learning these skills in college?

Colleges often don’t emphasize job training

“These institutions are notoriously hard to change,” said Steve Farkas, a senior researcher at the nonpartisan organization Public Agenda who authored a study of business leaders’ attitudes toward higher education. “They’re not responsive to real-world concerns, and they are very protective of the standard operating procedures.”

A few schools have started offering programs to fill the gap. Northeastern, Mount Holyoke and the University of Central Florida are among the schools that have so-called “experiential learning” options under which students get to work with employers in their chosen fields before graduation.

But these programs are still more the exception than the rule, said Farkas.

Matt Tower, a student at Amherst College who spent his winter break 93 miles away at a Fullbridge seminar, said the experience was unlike anything he could have gotten on campus—even though Amherst has an economics program and some business-oriented clubs.

“We’re very strictly a liberal arts college,” Tower said. “There are very few options at Amherst if you want to prepare for a career in business.”

Ursula Olender, director of the Amherst career center, said the school is in the process of setting up a program like Fullbridge’s on campus to help its students develop “the hard and soft skills that are not offered in great depth in a traditional liberal arts setting.” The price has not been determined, but “no qualified Amherst student who cannot pay will be denied the opportunity to participate,” she said.

Bowdoin spokesman Doug Cook said that college does offer students other chances “to deepen their understanding of issues surrounding business and personal finance.” The school’s president himself, Barry Mills, headlined a series of lectures called “A Crash Course on Practical Skills,” which also featured instructors from Fullbridge, and Bowdoin also offers a leadership development program and forums organized by its Finance Society and Women in Business club.

While schools such as these are working to shift some emphasis toward the practical, advocates for the liberal arts say focusing too narrowly on business skills produces students who can make presentations and read spreadsheets but can’t think broadly enough to know why the information they’re working with is important, or how to use it.

“What we don’t want are universities to think they should become centers for vocational activities,” said William “Brit” Kirwan, outgoing chancellor of the University System of Maryland. “If you just train people to take their first job, they won’t have the knowledge and skills and adaptability that they’ll need later on in their career.”

Employers are demanding more skilled grads

On the other side of the coin, employers seem to be unimpressed with the job colleges are doing to prepare their graduates. Nearly 90% of 500 executives surveyed said college graduates lack the most important skills they need to succeed, according to a Northeastern University report released in April.

“There is a communication breakdown between colleges and employers,” said Brian Rosenberg, president of Macalester College, a small liberal arts school in St. Paul, Minnesota. “Colleges and universities haven’t done enough listening to what employers need, and employers need to talk more about their requirements.”

To meet the demands of a globalized economy, universities and colleges have to give students hands-on business experience so they can learn to apply their academic skills, said Jason Tyszko, senior director of education and workforce policy at the U.S. Chamber of Commerce Foundation.

“Soft skills are missing across the board, regardless of what industry you look at,” Tyszko said. “We need to make sure that the rigorous standards of the higher education system are better aligned with the needs of businesses.”

Outside companies step in to fill the gap

Colleges’ slow response to the demands of employers has provided an opening for companies like Fullbridge, which holds workshops in cities including New York and San Francisco at a cost of up to $8,500 per student. Some schools, including Bowdoin, invite Fullbridge onto their campuses and help foot the bill for them.

Fullbridge is hardly the only—or even most expensive—organization that seeks to fill the gap between what colleges are teaching and what employers say they need. The Tuck School of Business at Dartmouth offers a similar month-long program in the summers for $10,000, and is expanding it to December. Harvard Business School just started a $1,500 online course to teach undergraduates elsewhere “the fundamentals of business thinking.”

Thirteen universities, including Brown, Georgetown, and the University of Southern California, have teamed up with a Seattle-based startup called Koru, which gives students the opportunity to work on real-world problems for businesses such as REI while working under executive coaches. The price: $2,750, though the participating schools often subsidize the cost.

Additionally, a company called General Assembly has a 10-week course in business fundamentals and tactics for $3,900 that covers everything from financial modeling to team management and is touted as a condensed version of business school.

Internships are another way to learn some of these skills—for free or better yet, while being paid. But often those experiences are more about getting coffee than career development, said Dyanne Rousseau, a recruiting coordinator at Mount Holyoke. Plus, in some fields, internships have become extended job interviews, at the end of which most students walk away with post-grad job offers. Students now have to be prepared in advance to compete for those opportunities, she says.

So for now at least, students like Ben Wei may find themselves having to pay extra to help fill the gap between the theoretical education their liberal arts college provides and the vocational training their future employers will demand.

__________

This story was produced by The Hechinger Report, a nonprofit, nonpartisan education-news outlet based at Teachers College, Columbia University.

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