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February 22, 2011


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A bank CEO told me I would be shocked if I learned the amount they made from overdraft fees.

My daughter had a year in college credit upon high school graduation. By going summers she had her degree in 2 years. And remember that saves on room and board, not just tuition...My son made up for her speed however:)

Correlating your student debt to your estimated income should be part of mandatory admissions counseling!

I'm sad to say that I have friends that have paid this regretful tax.

My friend is pretty good with money, but the spouse isn't. Unfortunately, both spend too much, so they never have a buffer (I personally like to keep a $5,000 to $10,000 buffer in my checking account). All said, I know they have at least wasted $500 over the time by overdraft fees since I've known them. So it's a frequent occurrence in their household...

Sad (and they make decent money to boot!).

My wife and I both graduated from college with $0 in student loan debt. In my opinion, this is the #1 thing that has helped us achieve a fairly solid financial position at the ages of 25 and 26 - that, and the ability to become solid employees, grow our careers, and have above average earnings from our jobs.

If I recall right, most of the overdraft fees are paid by a relatively small % of the people. Its something like 90% is paid by 10% (not sure on the numbers but something like that). So you get someone who's bank account goes negative then they have 10 transactions go through and quickly pile up $300+ in fees before they realize it. Or you have people who simply don't watch things and routinely end up paying fees cause they don't balance their checking.

I think the student loan problem isn't as bad as it is made out to be. WE hear far too much about the people who owe $100k or more but those people are in a very small minority. The $22k debt level isn't overly burdensome assuming that the graduate can get a job. But if they don't have a job then its a lot more difficult and unemployment among recent grads is pretty high lately. And we have far too many people piling up $20k+ in loans for humanities or other degrees with marginal employment.

My FICO score is higher than FMF? I am shocked. But then again me and my wife both work and have good paying jobs.

As for AP classes great if you have a realllllyyyyy smart kid. My kids are just plain smart but not enough to kill a whole semester.

Overdraft fees I can see this. I have been bitten twice due to electronic transfers not going in a timely fashion. It killed me paying those fees. I at least learned from this mistake. Apparently others have not.

My son and I are working on keeping college debt to a minimum. He has filled out dozens of scholarships apps and is constantly looking. Hopefully he will get some to ease the burden.

Being both raised in England during WWI we are still somewhat unconventional by American standards and change doesn't come easily to us. In both of our cases while we were living in our parent's homes the local custom was that as soon as you earned any money you gave between 35%-50% of it to your parents to help with living expenses.

I handle my wife's Credit Union accounts as well as my own because she doesn't share my passion for computers. I would never dream of wasting $5,000 to $10,000 as a buffer in a checking account, especially one that hardly pays any interest, ours only pays 0.25%. Our pension checks get deposited into Savings on the 1st. of the month and our SS checks on the 3rd. of the month. I enter all bills into "Bill Pay" as soon as they arrive and it's a simple matter once or twice/month to just make a transfer from Savings into Checking to take care of them. After estimating checks that will be written during the month and including one bill that is a direct withdrawal I leave a buffer of $200 - $300 to cover any errors etc. that may possibly occur. We also have overdraft protection that would trigger a transfer from savings to checking if needed, but it has never been needed. I am such a "Scrooge" about our finances that it would really bother me if we ever had to pay either an overdraft or late fee, or any interest.

FICO scores mean little to me since I gave up using other people's money many years ago, the last reading I had was 780.

When I left high school I won a scholarship to London University but my parents did not have the money required for me to live away from home so I couldn't accept it. After many years of socialist governments after WWII this has all changed, there is now a university in my home town as well as in every major town and city in Britain.

As for college tuition my undergraduate training was 5 years part time at a local Municipal College in England that was free while serving an engineering apprenticeship with a major aircraft manufacturer, and my post-graduate education was part time at an excellent private Jesuit University in California that was paid for by my employer, a major aerospace company.

As for the three children, we never provided allowances so they each held jobs throughout high school, the youngest child (now 47) never went to college and is now a top salesman, the middle child (now 50) went to a California State University while living at home and paid her own tution, she worked briefly as manager of a high rise office building until marrying a very wealthy attorney, the eldest daughter (now 52) started as a flight attendant then went to a Junior College for an AA, then to a dental school at her own expense for training as a dental assistant, then became office manager for the aformentioned attorney. The two eldest are millionaires, the youngest is very close. No one in our whole family has ever had a student loan.

Limey, you were raised in England during the Great War? That would make you at least 92 if you were born in 1918. Did you mean the Second World War?

When I last checked about a year or so ago my FICO score was 817, but it may have dropped a bit since then because I've applied for some credit cards recently and been denied.

There doesn't seem to be any rhyme or reason to the score when it comes to the last 50 or so points. I remember reading an article in Money, I think the September 2010 issue, in which some of the people they talked to were taking out loans they didn't need in an effort to get their credit scores closer to 850. Seems kind of pointless to me.

See, I thought the FICO average would be lower actually, and the student loan debt from a private university to be higher.

Shows what I know...

Guys, FICO 'Average' may be 730 but the statement above was the Median score.

I worked in an S&L for a number of years and the overdraft fees were hard on the poorest sector. They would write a large check (for them) of $30-100 and then several little ones of $2-10. If the larger check came in first, they would be looking at fees of $10 each for the smaller checks. Don't you just love paying a larger fee than your check was!!! And now the fees are like $25-35 each.

Only OD'd once. I took my husband's paycheck to the bank, they deposited it and gave me a receipt. I was worried that the check might not be in soon enough to stop one possible OD. Got an OD notice and knew I had the money in. But, the next day I got 3 more. I knew that could not possibly be right. Went to the bank. They double checked. Apparently the teller had looked at the employer that wrote the check and put it in that account. Since I did not know my husband's account number, I had not noticed the slip-up. And being in a small town, both accounts were at that bank. They fixed it all up and no OD fees at all, as it was their error.

Sorry about the slip up, I should have typed WWII, what a difference one character makes. My grandfathers were in WWI but they are deceased of course.
I get credit card offers in the mail every week and our Credit Union tells us we are each pre-approved for a $40K car loan. Everyone seems desperate to try to get consumers to spend money these days. It's not working on us - we only buy what we need, and these days that's primarily food, wine, and gas.

As the father of a soon-to-be-college student I've found that those AP classes really aren't going to save us any money.

Almost all colleges now are on a "flat-fee" plan; you pay the same amt whether you take 12 or 18 credits. So my son testing out of AP English for 1 semester isn't going to save me a penny. Sure, he will be able to carry a slightly lighter work load for the first couple semesters, but it won't save me the money it would have back when I was a student and paid per credit hour.

With the way prerequisites are structured, it is hard to eliminate an entire semester let alone year. So testing out is great, but you can't just cram the rest of your classes into fewer semesters; you have to complete some before you can even take others, ENG-101 before you can take ENG-201, etc.

And don't even get me started on colleges not scheduling certain classes in certain semesters. Talk about a scheme to keep kids in longer and pay more tuition!

Flat fee tuition can be beneficial if you can crank out 18 credits per semester. In order to do that students need to stop binge drinking and partying all the time and buckle down. Some will, most wont.

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