7 Ways to Support Charities, Even If You’re Broke

4 Ways to Avoid Charity Scams

When college student Kara Skinner was short on cash, she started the blog Lover’s Quarrel, reviewing romance novels and including affiliate links in her posts. Thanks to her posts, she earned $60 from those links. But instead of splurging on pizza and a night out with friends, Kara decided to use her money in a different way: she donated it.

“I read I Am Malala and was so inspired,” Kara says. “Not everyone can get an education like I can because of where they live or their gender.”

Since launching her blog, Kara has donated to organizations like the Malala Fund and the Arbor Day Foundation. Because she uses her earnings from her website, she never has to dip into her bank account to contribute to charities.

Kara isn’t alone in her outlook: millennials are extremely generous when it comes to nonprofit causes. In fact, the majority of this age group donate to charity—an especially notable feat when you consider that debt is the biggest money-related stressor millennials face.

7 Ways to Donate to Charity

While that charitable mindset is admirable, finding the extra money to donate can be difficult. Between bills and debt payments, there’s often very little left over to give away.

However, a lack of money doesn’t have to hold you back from helping your community. You can make a big difference by doing one or more of the following things, without hurting your monthly budget.

1. Sign Up for AmazonSmile

If you shop on Amazon, you can help nonprofit organizations just by making routine purchases. Once a charity signs up with AmazonSmile, Amazon customers can select that organization to receive donations.

To take part in the program, visit Smile.Amazon.com instead of Amazon.com, and do all of your shopping from the new link. After you check out, the AmazonSmile Foundation will donate 0.5% of the purchase price of eligible products to the charity you choose.

That number might not sound like much, but it can add up over time. If you spent $1,000 on the site on regular purchases like toilet paper, laundry detergent, and other essentials, AmazonSmile would donate $5 to your selected charity.

2. Sign Up for Rebate and Reward Apps

If you’re short on cash, you can earn extra money to donate just by signing up for rebate and reward apps. Sign up for apps such as Ibotta and Checkout 51 and turn your receipts into cash.

These apps offer rebates for shopping at select stores or purchasing specific brands. After you’re done shopping, take a photo of your receipt with the app of your choice. Money will be deposited into your account.

Those rebates could add up to a hefty amount of cash. In fact, some people rack up hundreds with rebate and reward apps. With that money, you can make a sizeable donation without digging into your savings.

3. Donate Blood, Plasma, or Bone Marrow

If you’re a healthy adult, you can make a lifesaving donation. Those with severe illnesses or who have been in accidents often need blood, plasma, or bone marrow donations to recover. However, thousands of people cannot find a match, and there are sometimes donor shortages.

Donating your blood, plasma, or bone marrow can be a lifesaving act of charity in itself. In many cases, centers will pay you to donate plasma, allowing you to help someone in need while you earn extra cash to donate. When it comes to bone marrow, however, you’re not likely to be paid for donating—but you can still help save someone’s life.

To find a collection center near you, visit the American Red Cross, Donating Plasma, or Be the Match.

4. Cut Your Hair

Do you get compliments on your long, beautiful hair? You can use those lovely locks to help someone else going through a rough situation.

Children and adults with alopecia or those undergoing chemotherapy can experience hair loss. They often turn to wigs to cover their scalps and feel more confident. Human-hair wigs are the best you can buy; they look the most natural and can be washed and styled like regular hair.

However, human-hair wigs can cost thousands, and they are often unaffordable for many families. Several organizations try to ease the burden by collecting human hair to make wigs for both adults and children.

Locks of Love, Pantene’s Beautiful Lengths program, and Wigs for Kids all accept hair for wigs. While each organization has its own requirements, in general, you must meet the following guidelines to donate your hair:

  • Your hair must be securely fastened in a ponytail.
  • If your hair is in a ponytail, the tail must be at least 8 to 12 inches long to be useable.
  • Your hair cannot be bleached or highlighted. In most cases, dyed hair that does not have any bleached sections is acceptable.

5. Donate Gently Used Clothing or Household Items

If you have old clothes, furniture, or household items lying around, you might be able to help someone in need.

You can donate items to organizations such as Goodwill, which can sell those items in thrift stores and use the proceeds to fund other programs—such as employment training and job placement services—for people in your community.

Use Goodwill’s locator tool to find a donation site near you.

6. Use Side Income to Fund Donations

If you’re like Kara and don’t have much money to donate with your current budget, you can start a side hustle to make extra cash. Side hustles allow you to work as much as you want, when you want. If you want to make a donation around the holidays, you can take on seasonal work to get the money.

Because it’s extra income, you won’t miss it after you give it away. And you won’t fall behind on your rent or student loan payments, either.

7. Collect Spare Change

Even your piggy bank can be turned into a source of donations. At the end of each day, empty your pockets and bag and deposit any loose change into a jar.

You can also boost your donations by looking for forgotten change on sidewalks or streets. One blogger collected $27 just by looking around at car washes, in gutters, and in parking lots.

Once your change jar is full, take it to the bank to turn it into cash before donating it to a charity of your choice.

Donating to Charity

When you’re broke, it’s hard to scrounge up the money to help others. But if you’re determined to help your community, thinking creatively can help you make a tangible difference. Try accounting for donations in your monthly budget to make it a regular part of your spending habits or try looking for credit cards that make it easy to give to charity. By taking on extra work or sacrificing your time, you can help change someone’s life.

Image: istock

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Identity Thieves Bought a New Car in Her Name—Here’s How She’s Fighting It

identity-theft-after-death

Jen* is one of the few people that opens and reads every piece of mail they receive. It’s a quirk that has paid off: A piece of junk mail is how Jen found out someone had stolen her identity.

“I opened a letter from Macy’s, which I thought was weird,” she said. “I haven’t shopped there in years. But the letter was a rejection of a credit card application.”

Jen took immediate action, placing a credit freeze on her accounts. She thought it was all resolved then, but her identity theft nightmare was just beginning.

The Depth of the Identity Theft Problem

Jen checks her free credit report every four months. After finding the Macy’s rejection letter, she immediately checked her report again.

There were several credit inquiries for loans and credit cards that she had not made. Banks and lenders had rejected all of them. However, there was one item on the report that had been approved: a car loan for a $30,000 vehicle.

“The thief applied for a loan through an online company, which is much easier than applying for a loan in someone’s name in person,” Jen said. “She picked up a used Lexus the next day. She used my Social Security number but didn’t use my actual last name. The company still didn’t bat an eye.”

The thief even took out a car insurance policy in Jen’s name. Again, the thief applied for an account online for easier approval.

Beyond Credit—How Theft Affects You

“There were about a dozen inquiries on my credit report besides the car loan, all of which hurt my credit score,” said Jen. “And, the thief didn’t make payments on the insurance or the car, which could have hurt my credit too. I had to take action right away.”

Jen then filed a police report. An officer came to her home, and she handed over copies of her credit report with all of the fraudulent inquiries. Because it was a financial matter, the officer handed the case off to a different department.

Once Jen had a copy of the police report, she took action rather than waiting for the police to work it out. Luckily, her employer offered a free identity protection service through InfoArmor. She called the company, and representatives assigned her a case manager. Together, Jen and the case manager made a list of every false inquiry on Jen’s report and started contacting the companies one by one to have them removed.

“There were inquiries for store credit cards, phone companies, furniture stores, and car loans,” said Jen. “All of them were at places in California, and I’m thousands of miles away from there.”

The process couldn’t be completed in one day. The thief had taken information from Jen’s LinkedIn profile to verify employment dates on applications, and the person’s actions changed her security questions on the credit bureau sites as well.

Jen’s credit report now showed the thief’s address and other information instead of her own, so she couldn’t dispute the charges online. Instead, she had to call each business herself and prove her identity.

Most of the companies’ customer service departments were available only between 9 a.m. and 5 p.m., when Jen was at work. “I had to squeeze in calls on my lunch break and every spare minute I had,” she said.

Over the course of two months, Jen spent over 80 hours on the phone to dispute charges and inquiries. There were times when she was on the phone for five hours straight. Despite the long hours, she values the identity protection service for helping her handle it.

“[The case manager] was on the phone with me for the full time,” she said. “He helped me keep it together and work through the list of companies.”

Other Financial Ramifications of Identity Theft

Although the phone calls were tedious and incredibly time consuming, there were larger issues that Jen hadn’t even considered. Her InfoArmor case manager helped her navigate those problems as well.

“I could never have thought of it all on my own,” she said. “But he told me I needed to alert my 401(k) company, my mortgage lender, and my credit union account so [the thief] couldn’t access those accounts too.”

Worst of all, the problem still isn’t over. The car loan has been removed from her credit report, but other inquiries remain. Jen also worries about future issues, such as the thief filing a fraudulent tax return in her name to get a tax refund.

“I’m worried about my taxes,” she said. “It’s a real stressor. I contacted the IRS, but I’m still concerned.”

She has every reason to worry. Despite now having the thief’s full name and address, the police have not yet arrested or charged the individual. Instead, the investigation is ongoing thousands of miles away.

Advice for Dealing with ID Theft

Thanks to Jen’s hard work, her credit score has recovered since the identity theft. She notes that not everyone could handle identity theft as quickly as she did, nor does everyone have the means.

“It was time consuming and tedious, but it was also expensive,” she said. “I had to pay to FedEx documents across the country, to put a credit freeze on my account, and to have access to a fax machine—most of the documents couldn’t be emailed because of security concerns, so faxing them was the only way.”

In addition, Jen said that her employer and coworkers were understanding as she navigated the process. In many workplaces, taking personal calls during work wouldn’t be possible. Other people might have had to take time off from work to deal with identity theft, hurting their paycheck.

For those who face a similar situation, Jen recommends you do the following:

  • Take diligent notes and keep them nearby. Every credit inquiry Jen disputed had its own case number, and because she sometimes had to wait days for a response, Jen had to move quickly when she did get a response. Keeping a notebook handy with every case number, the date and time of each call, and who she spoke to last helped her stay on top of the issue.
  • Check your credit report. Jen caught the problem early, which saved her credit and finances. It’s a smart idea to check your credit report every four months for red flags.
  • Consider hiring a service. While Jen was able to get identity protection for free, she says she would have willingly paid for it. Her case manager helped her through every phone call and identified other actions she needed to take to protect herself.
  • Give yourself a break. Dealing with endless phone calls and the stress of identity theft can be hard on your nerves and well-being. Jen advises giving yourself a break every now and again and indulge in some self-care.

Moving Forward after Theft

Jen doesn’t know how the thief got her Social Security number or name, especially because she’s diligent about protecting sensitive information. However, she suspects it’s from medical forms from her frequent doctor appointments, as they all required her to enter her Social Security number, address, birthday, and other identifying information—making her an easy target for identity theft.

“Unfortunately—and the police said the same thing—people take those forms and sell them on the black market for others to use,” she said. “It’s made me much more conscious of what I put out there.”

Jen’s story isn’t an anomaly. A whopping 41 million Americans have experienced identity theft. That’s why it’s so important to continually and regularly check your credit report.

“You have to stay on it to prevent your name and credit report from being ruined,” Jen said. “Be diligent.”

*Because the investigation into this situation is ongoing, the individual featured asked that we not use her real name.

Image: istock

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When Your Student Loans Are Sold: What You Need to Know

Lenders can sell your loans whenever they want, so it’s important to have some safeguards in place. Here's what you need to know.

While I was working on paying off my student loans, I checked my account balances weekly. One day, I logged into my account and the $10,000 I had in outstanding loans had disappeared.

At first, I was elated. Had some generous benefactor swooped in to pay off my debt? Then I realized I couldn’t be nearly that lucky — so I tried to figure out what happened.

Many people, including a financial professional, told me not to look a gift horse in the mouth and ask too many questions. But I didn’t think loan servicers were likely to have forgotten about my debt.

Tracking Down My Loans

I tried emailing my loan servicer to find out what happened, but didn’t get a response for a few weeks. I was afraid my loan payments would become due and I wouldn’t know where to make payments, so I decided to check my credit report to see if I could find my loan. (You can view two of your credit scores for free on Credit.com.)

Sure enough, my credit report showed my loan had been moved to a new loan servicer. When I reached out to the issuing bureau, they said my old lender had mailed me a letter as notice of the change, but I never received a letter.

It’s possible they had an old address on file, or I accidentally tossed it in the trash, but I’m glad I pursued it. If I hadn’t continued digging, I never would have found out and could have defaulted on my debt.

What Happens When Your Student Loan Debt Is Sold

My situation is not unique. Federal and private student loans can be sold to other lenders at any time. There’s a market of organizations that specialize in buying and servicing student loans.

When your loan is sold to a new lender, you’re indebted to the new owner of the loan. You have no more contact with the old one. While the new servicer might offer some new benefits, the basics of your loan — such as the interest rate or repayment term — will not change.

The original lender will send you a letter notifying you of the upcoming switch. Then, you’ll get a second letter from the new lender that explains why your loan was sold, who your new loan servicer is and how to make payments.

How to Protect Yourself

Because lenders can sell your loans whenever they want, it’s important to have safeguards in place. You don’t want to miss a notification and end up falling behind on your payments. Here’s what you can do to protect yourself:

Update your contact information. If, like me, you’ve moved around, it’s important to make sure your lenders have your most recent contact information. Log in regularly and check to see they have the right mailing address and phone number.

Read all mail. Read every piece of mail that comes from your lender. Don’t just assume it’s a monthly statement and toss it. It could be an important notification.

Check the notification for accuracy. If you receive a notice that your loan is sold, make sure the balance and terms of your loan are accurate.

Contact your lender with any problems. If you can’t find your loan or make payments, call your lender’s customer service line right away.

Track your loans with the National Student Loan Data System (NSLDS). The NSLDS is a database that tracks your federal loans. It will list which loans are under your name and the loan servicer for each one.

Check your credit report. If you aren’t sure if your private loan has been sold, you can find out by checking your credit report for free at AnnualCreditReport.com. It will list all your current loans and who owns each debt. Once you have the name of the lender, you can contact them to get your login information and start making payments.

By keeping your information up to date and checking your account regularly, you can prevent any confusion when managing your loans.

What to Do If You Hate Your New Loan Servicer

In my case, my new loan servicer was an improvement over the old one. Their online platform was easier to use and their customer service department was more responsive.

Some people don’t have the same experience. The Consumer Financial Protection Bureau reported there are thousands of calls each year from consumers about their student loan servicers.

If you have problems with your new loan servicer, such as delays in getting a response for an issue you reported, here’s what you can do:

Contact the student loan ombudsman. If you can’t get your problems fixed, you can contact the student loan ombudsman. An ombudsman is a neutral third party that will work with you and your lender to identify a solution.

Refinance your loans. If you’re simply looking for more features or want to reduce your interest rate, refinancing your student loans might be a smart approach. If you refinance, you’ll work with a private lender to take out a new loan for the amount of your old one. You can get a different repayment term, monthly payment and interest rate.

Managing Your Loans

The student loan system can be incredibly complex. Trying to navigate it can be difficult, especially since your loans can be sold to a new lender at any time.

You can protect yourself by being proactive and monitoring your credit report. If you hate your loan servicer, know that you’re not stuck with them. You can identify a resolution or get a whole new servicer who offers more favorable repayment terms.

For more information on shopping for a new loan, here’s what to do if you hate your loan servicer.

Image: kajakiki

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Meet the Man Who Makes $600 a Month Selling Crickets

When Jeff Neal’s wife told him she wanted to quit her job to stay at home with their kids, he had to think about how to make one income work.

When Jeff Neal’s wife told him she wanted to quit her job to stay at home with their kids, he had to think about how to make one income work. With over $21,000 in student loans, there wasn’t much extra money lying around. Losing another income stream would be difficult.

But rather than give up hope, Neal did something no one expected. He launched a side business that helped bring in extra money: selling crickets online.

Yes, you heard that right. Crickets.

Now, Neal makes $600 a month selling bugs online at The Critter Depot, which helps him pay off his debt. Read on to learn more about this odd side hustle and how Neal has turned it into a steady income stream.

Searching for a Side Hustle

Neal graduated from Temple University and got a job as a project manager. While he made a good salary, he had student loan debt and a growing family. When his wife decided she wanted to stay home with the kids, Neal knew he had to make changes.

“My wife wanted to stay home, so I had to take full responsibility as the sole provider,” he says.

Since his full-time job involves e-commerce, he focused his side-hustle search on online jobs. After doing extensive research, he decided to put all of his efforts on one specific niche.

The area that he identified was in the pet industry; reptile and exotic animal owners need live crickets to feed their pets, but getting them can be difficult — and expensive. So, Neal’s site caters to pet owners, selling crickets of various sizes in bulk.

But before you rush out and buy tanks and crickets to replicate Neal’s success, you should know his approach is even more interesting. He actually doesn’t deal with the crickets at all. Instead, his business is a drop shipping company.

What Is Drop Shipping?

Drop shipping is a business model where the store doesn’t stock any of the items it sells. Instead, when a customer purchases a product, the drop shipper works with a manufacturer — or in this case, a cricket supplier — to fulfill the order. The drop shipper never comes into contact with the product, so wrangling crickets isn’t part of Neal’s day.

“I don’t know anything about raising crickets,” he admits. “They have short life spans and unique nutritional and environmental needs. It’s a lot of work that takes a lot of knowledge. When I set up my business, I found someone who breeds crickets. He takes care of them and ships them; I just handle the orders.”

For customers, drop shipping is a seamless process, whether it’s through Amazon or a private site. Most of the time, you don’t know when you’re buying from a drop shipper. Once your order is placed, the drop shipper works with the supplier to place the order, and you receive the item like you normally would.

Drop shipping can be a mutually beneficial relationship between the seller and supplier. In Neal’s case, he has the marketing expertise and skills to build a successful website and business. That gets the cricket farmer more exposure and more orders than he would get on his own. Neal estimates that he generates about $3,000 in sales each month from The Critter Depot and his cut is $600.

Previously, Neal primarily sold crickets on Amazon. But meeting Amazon’s strict standards is hard when you’re shipping live insects. He ended up taking his sales to just his website, which requires more work for him each day to build traffic.

His new income stream allows him to take advantage of other opportunities, too. He recently purchased the site Jason Coupon King, which generates another $700 a month in revenue.

Balancing a Side Gig With Life & Work

While Neal’s side hustle is successful, he has to balance his work with his full-time job and his family. But that’s why he says drop shipping is a great option. It gives him the flexibility he needs while still allowing him to earn extra money.

“I don’t have a television, so when I come home from work, I just spend time playing with the kids and catching up with my wife,” says Neal. “Once they’re in bed, I work on optimizing my websites, contributing to forums and building links to my sites.”

Neal says he spends an hour or two a day after work on his side hustle and that his business is still growing. The extra income is substantial enough to help him pay off his student loans early and give his family more wiggle room in their monthly budget. (You can keep tabs on your own finances by viewing two of your credit scores for free on Credit.com.)

Making Extra Money

While selling crickets might not be for you, Neal’s story is just another example of the many ways you can make money on the side. If you’re struggling to make ends meet, or need more income to pay down debt or boost your emergency fund, launching a side hustle can be the right approach.

Photo courtesy of Jeff Neal 

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How Your Credit Report Can Help You Manage Student Loans

Handling your student loan payments may not be easy, but here's where you can start to take control.

More than 1.8 million students graduate from college in 2017. While it’s a momentous achievement, many graduates will walk away with significant student loan debt. Though keeping up with monthly payments can be difficult, knowing how to budget for them can be an even bigger obstacle.

If you’re feeling overwhelmed and don’t know how to begin managing your loans, your credit report can be an essential tool. Here’s how your credit report can help you take control of your debt.

What’s in Your Credit Report?

Your credit report is a complete picture of your financial history. It contains information about your bills, loans and what credit cards you have open.

Lenders use your credit report to make decisions on your reliability and financial stability. They look at your report to evaluate whether to offer you a car loan, mortgage or a new credit card. However, your credit report is an invaluable source of information for you too, especially if you have student loans.

2 Ways Your Credit Report Can Help You Manage Your Loans

When you’re in school and take out federal or private student loans, it’s easy to lose track of who your lenders are or how much you borrowed — especially if you don’t have to start repaying them yet.

To make things more difficult, your debt can sometimes transfer to a new loan servicer. If that happens, you’ll have to make payments on a different website and you’ll have a new account. That’s where your credit report comes in handy. You can use it to locate your loans and their current status in the following ways:

  1. Identify your loan servicer: If you aren’t sure who your loan servicer is, use your credit report to identify who manages your loans. Your credit report will list all the institutions behind your debt. Once you have the name of your servicer, you can use that information to sign into your account and begin making payments.
  2. Find out your current balance: Thanks to interest, your loan balance could grow while you’re in school. If you’re unsure what amount you owe, your credit report will list the current balance on your loans.

Where to Get Your Free Credit Report

There are many services that will send your credit report for a fee. However, paying for your credit report is unnecessary. You can get a free credit report from each of the three credit bureaus — Equifax, Experian, and TransUnion — once a year from AnnualCreditReport.com.

It’s a good idea to stagger your credit reports throughout the year. For example, you could review one credit report from each agency every four months. That way, you can continually review your credit report for issues, rather than waiting a full 12 months. Catching problems early can save you money and protect your credit.

You can also check your credit scores for free on Credit.com. They’re updated regularly and can help you spot changes in your credit reports if they go up or down unexpectedly.

What to Do If There’s an Error

An essential part of checking your credit report is reviewing it for errors. Sometimes loans are reported incorrectly or, in cases of identity theft, fraudulent accounts can be put under your name.

If you find an issue, whether it’s a simple mistake or a more serious issue of theft or fraud, it’s important to take action right away. If the accounts in error become delinquent, those late payments can cause your credit report and score to plummet. That will make it more difficult for you to get a loan, a new credit card or get approved for a new apartment. The longer you wait to act, the longer it could take to correct.

To report a problem, write a letter disputing the errors and send it in the mail to the following:

  • Equifax: Equifax Information Services, LLC., P.O. Box 740256, Atlanta, GA, 30348
  • Experian: Experian, P.O. Box 4500, Allen, TX 75013
  • TransUnion: TransUnion LLC, P.O. Box 2000, Chester, PA, 19016

You should also notify the bank or financial institution that reported the error. Include copies of any supporting evidence you may have to prove your case.

To ensure you have a record of contacting the organizations, it’s a good idea to send the letter as certified mail as proof.

If you report the error and the credit bureaus and financial institutions do not fix the issue, you can escalate the problem to the Consumer Financial Protection Bureau.

Managing Your Credit

Graduating from college is a huge milestone, but it’s easy to get overwhelmed managing your student loans. From figuring out who your loan servicer is to learning how much your loans grew, the process can be complex.

Getting your credit report and credit scores and reviewing them thoroughly can help you keep track of your loans and stay current on your payments.

Image: g-stockstudio

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6 Vital Things Parents Need to Know About Student Loans

Before helping your child take out loans — or taking out loans in your own name — make sure you understand the benefits and drawbacks.

About 3.5 million high school students are expected to graduate from high school this spring, and most will go to college. While this a proud moment for students and parents, many families are stressed about how to pay for school in the fall.

Before helping your child take out loans — or taking out loans in your own name — make sure you understand the benefits and drawbacks. Here are six things every parent should know about student loans.

1. There’s Still Time to Complete the FAFSA

For your children to get federal student aid such as loans, grants and work-study programs, they must complete the Free Application For Federal Student Aid (FAFSA) every year.

If your child hasn’t completed their FAFSA yet, there’s still time — but not much. Though the federal deadline is June 30, 2018, states and individual schools often have much earlier due dates.

Moreover, schools have limited funds when it comes to some loans and grants, so the earlier your child applies, the better. To make sure you get the necessary funds, submit the FAFSA as soon as possible. You can complete the application online in less than 30 minutes.

2. Take Advantage of Federal Loans First

You’ll find out what types of federal aid your child is eligible for after completing the FAFSA. If your children need to take out loans to pay for school, encourage them to start with federal student loans rather than private ones.

Federal loans typically have lower interest rates, more generous repayment terms and do not require a lengthy credit history or a co-signer. Plus, they come with benefits such as access to income-driven repayment plans and deferment or forbearance options if your child struggles to make payments after graduation.

Private student loans can have higher interest rates and typically require a co-signer. They also have fewer repayment options, which can make keeping up with payments more difficult on an entry-level salary. Private loans should be a last resort used to fill the gap if federal loans don’t cover the total cost of college attendance.

3. Learn How Parent PLUS Loans Work

If you want to help your child pay for school but don’t have enough money saved to pay outright, you may be eligible for a parent Direct PLUS Loan. This is a federal loan designed specifically for parents of dependent students.

To be eligible, you must be the biological or adoptive parent and your child must be enrolled at least half-time at a qualifying school. Both you and your child need to be U.S. citizens or eligible noncitizens. Unlike other forms of federal loans, parent PLUS Loans require a credit check.

To get a parent PLUS Loan, your child should complete the FAFSA. You will sign a PLUS Loan master promissory note. You can borrow as much as the cost of your child’s education, minus any other financial assistance you receive. The current interest rate for Parent PLUS Loans is 6.31%.

4. Think Twice Before Co-Signing

If your child needs a private loan to pay for school, the lender may require a co-signer before approving them. Before you agree to cosign, make sure you understand what it entails.

Becoming a co-signer means you’re the guarantor of the loan. If your child falls behind on the payments, you’re responsible for making them. If your child misses a payment and doesn’t tell you, your credit will be damaged. That consequence can make it more difficult for you to get approved for other forms of credit, such as a mortgage or car loan. (You can see how student and other loans impact your credit with a free credit snapshot on Credit.com.)

Co-signing is a huge responsibility, so make sure you’re comfortable with the potential fallout before putting your signature on a loan application.

5. Know Discharge Rules

While no one wants to think about themselves or their child dying or suffering a serious accident, it’s important to understand a loan’s rules about these events before taking on student debt.

If your child has federal loans and later dies, the government will discharge the debt. If you have a parent PLUS Loan and either you or your child passes away, the loans are also eliminated. If your child becomes permanently disabled and can no longer work, they can get their loans forgiven through Total and Permanent Disability Discharge.

Private loans are different. Some lenders discharge loans in the case of death or disability, but not every lender offers this. There have been horror stories about parents who have lost a child, yet are still responsible for the student loans. Make sure you understand the lender’s rules before taking out or co-signing a private loan.

6. Prioritize Yourself

Though supporting your children through school is a wonderful gift to offer, take a hard look at your finances first. If you have other forms of debt or your retirement savings are too small, prioritize your own finances.

Your children can get grants, scholarships and work part-time in school to pay for college. If they struggle to repay their federal student loans, there are a wealth of plans and programs to help them get back on track.

The same is not true when it comes to credit card debt, personal loans or retirement. If you fall behind on payments or don’t save enough before you stop working, there are few places you can turn for help. Ensure you are in a secure financial position before taking on more debt for your child.

Know Your Funding Options

Before signing loan paperwork, make sure you know exactly what you’re getting into. Student loans can be complicated, and if you’re not careful, you could be on the hook for thousands in debt. Work with your children to ensure you understand all your options and obligations as you prepare to send them off to college.

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Moving to One of These 9 States Could Save You Thousands

Should you move to one of the nine states with no income tax? Here's how to decide.

Each year, taxpayers pay trillions in income taxes. In fact, the government collected approximately $3 trillion last year. If you’re like most taxpayers, you owe both federal and state taxes, which means an even bigger chunk of your paycheck goes to the government.

When you’re carrying debt — whether it’s student loans or a credit card balance — it can be frustrating to see so much of your hard-earned money leave your hands. That’s why many people consider moving somewhere with no state income tax.

According to a new study by Student Loan Hero, taxpayers could save an average of $1,977 a year by moving to a state with no income tax. But before you pack your bags, find out what factors you should keep in mind.

States Without Income Taxes

States that collect income taxes use them to fund essential programs and services for residents. More than 50% of state tax revenues go toward education and healthcare initiatives, such as Medicaid. State agencies also use collected income taxes to pay for services, including transportation and law enforcement.

Residents in most of the country must pay federal and state income taxes. However, nine states don’t levy any state income tax: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington and Wyoming. Because you don’t have to pay state taxes, you can get a significant yearly savings.

How Much Could You Save?

How much you could save by moving to a state with no income tax depends on your income bracket and where you live now. For example, Oregon workers have a state income tax of 7.75%, the highest rate of any state in the country. Someone earning the median salary in the state — $49,710 — would pay $3,851 in addition to their federal taxes.

Moving to another state to save that kind of cash can be tempting. So tempting, in fact, that 30% of survey respondents would move to a state with no income tax to save money. Moreover, 38% of respondents said they’d use their tax savings to accelerate their student loan debt repayment. (To see how student loans are impacting your credit, check out your free credit report snapshot on Credit.com..)

Using Your Savings for Debt Repayment

The savings you get from not paying state taxes can save you even more money in the long run. Using that money to repay your loan helps you pay off the loans faster, cutting down on interest charges. It can also save you thousands over the life of your loan.

For example, say you had $35,000 in student loans with an interest rate of 6.31% (the current rate for Grad PLUS loans) and a minimum monthly payment of $400 a month. Now, take the average $1,977 you would save by moving to a state without income tax and divide it up over 12 months. That would give you an extra $165 in your pocket each month. If you put that additional amount toward your student loans, you could pay off your debt about three and a half years early and save more than $4,500 in interest.

Other Costs

Before packing up and moving to a new state, consider other costs that may eat into your savings. Between putting down a deposit on a new apartment, moving your belongings and registering your vehicle in a new state, you can spend thousands.

In addition, some states with no income tax make up their revenue through other means, such as sales tax. Florida has a 6% sales tax on goods and services, including essentials such as clothing or food. If you’re not used to paying taxes on groceries, the added sales tax can put a dent in your budget. That’s why it’s important to compare the cost of living when deciding if it’s worth it to move to a new state.

Moving to Save Money

Depending on your circumstances, moving to a state with no income tax can give you a substantial savings. You can use that money to pay off your student loans faster, boost your emergency fund or catch up on retirement savings. But before you make the leap, be sure you understand the added expenses of moving so your decision is financially sound.

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5 College Degrees That Are Worth the Money

There's no doubt that college is expensive. Here are the degrees that can really pay off.

There’s no doubt that college is expensive. In fact, the average cost per credit hour is $594, according to a new Student Loan Hero study on the cost of a college credit.

For a typical four-year program, students will spend $71,335 on average. If you have to take out loans to pay for your own educational pursuits, you could end up paying even more thanks to interest charges.

With so much money on the line, it’s important to be practical. So when deciding on your college major, it can be helpful to consider the degree’s return on investment (ROI) before making a decision.

How to Determine a Degree’s Potential ROI

When considering a degree’s ROI, think about what the earning potential is in your chosen field.

Some fields — such as teaching — can be immensely rewarding, but are notoriously low-paying. If you can get a degree for a relatively low cost, it may be worth it. Otherwise, you may be overwhelmed with debt as you start your career. Try researching salary potential on PayScale or a similar site.

Another factor to consider is field growth. While some career fields have high average salaries (law, for instance), new graduates have saturated the market and competition is fierce. Getting your foot in the door can be difficult and many workers are forced to take lower-paying jobs to make ends meet.

One great resource is an interactive report released by the Federal Reserve Bank of New York. It outlines unemployment data by industry, starting salaries, and the income you should expect by mid-career. It’s a tool that can help you see what fields are most in demand to help you ensure job security later on.

Five Majors With High Earning Potential

With those factors in mind, here are five degrees that are generally worth the money spent earning them.

1. Engineering

Engineering is one of the top-paying careers available today. The top-paying engineering specialties are petroleum, chemical and electrical engineering.

The industry is expected to grow about 3% by 2024, according to the Bureau of Labor Statistics. This signals continued demand for new workers. In most cases, you only need a bachelor’s degree, and not a master’s or professional credential, to begin your career.

And as an engineer, you can command the highest entry-level salary of all of your peers. Starting salaries average $64,891.

2. Computer Science

Computer science is another lucrative degree with the potential to work in several different areas. Organizations of every size and scope need skilled technology professionals, from small nonprofits to huge Fortune 500 companies.

Computer science is growing rapidly. The field is estimated to grow about 12% over the next seven years, outpacing many other industries.

If you enjoy this type of work, job security is high. Entry-level salaries average $61,321.

3. Math & Sciences

If you enjoy math, a degree in math and sciences can open doors for you throughout your career. You can work as a market analyst, operations researcher or project manager in a range of fields.

As companies increasingly adopt technology and research to grow their business, math professionals will be highly sought after. Experts project that the field will grow by 28% over the next few years.

The average starting salary is $55,087.

4. Economics

Similarly, the field of economics is in high demand, and salaries are increasing to meet the need. Economics is expected to grow 6% by 2024.

However, before pursuing a career in economics, it’s important to note that most jobs require a master’s degree. The added cost of graduate school can drastically increase your education costs. So it’s essential to evaluate the total expense compared to the salary.

The starting median salary is $52,100.

5. Communications

This major often gets a bad reputation for fierce competition and low salaries. However, communications salaries have recently increased and demand for new workers has gone up, as well. Within this broad field, you can pursue a career in public relations, marketing, or broadcast media.

The Bureau of Labor Statistics expects the addition of 27,000 jobs in communications by 2024.

The average starting salary for someone in this major is $47,047.

Selecting a major is a huge decision with long-lasting implications for your future. Before making a choice, sit down and evaluate your financial, personal and professional goals. Then you can decide what makes the most sense for you.

Remember: Passion is important, but so is your future. Earning a degree that promises better salary and employment opportunities means you can pay off student loans faster and actually enjoy the fruits of your labor.

Editor’s note: Your student loan repayments can have an impact on your credit scores. To see how your repayment history is affecting your credit scores, you can check out a snapshot of your credit absolutely free using Credit.com’s Credit Report Summary.

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5 Items You Should Pay Taxes On (But Aren’t)

The IRS expects you to pay taxes on all sorts of earnings, including these five things you might be overlooking.

When it comes to taxes, everyone knows you have to report your income from a full-time job or side gig. (Of course, not doing so is a common tax mistake.) But the IRS doesn’t stop there — they expect you to pay taxes on all sorts of earnings, including these five things you might be overlooking.

1. eBay Profits

If you sell the occasional item, such as a dress you no longer like or a collectible from your childhood, you likely don’t need to report your eBay income on your taxes. Because the items you auction off are probably selling for less than you originally bought them for, you’re taking a loss and the IRS views the transaction like a garage sale.

But if you sell items regularly — auctioning off 200 items and earning more than $20,000 in sales each year — your income is taxable. PayPal will issue you a 1099-K form with your earnings for the year in addition to reporting your income info to the IRS.

But even if you don’t meet those numbers, you may still have to pay taxes on eBay sales. If you deliberately buy items to resell on eBay or manage an inventory, the IRS considers your eBay store to be a business and will tax your profits as income.

2. GoFundMe Campaign

Crowdfunding sites like GoFundMe are increasingly popular, raising money to help people with everything from medical bills to paying off student loans. But when it comes to taxes, crowdfunding can be extremely complicated.

According to GoFundMe, donations made through the site are considered personal gifts and are usually not taxable as income.

But the key word is usually. There are exceptions. In 2015, a cancer survivor who received $50,000 in donations got a tax bill for more than $19,000. It gets even more complicated if you collect donations on behalf of someone else. Even if you transfer the money to them, you could be on the hook for paying taxes on the entire amount.

Before creating or cashing out a GoFundMe campaign, talk to a tax professional about what you can do to ensure the IRS views the donations as gifts rather than income. Otherwise, you could end up having to pay taxes.

3. Free Items

Items you receive free from companies can be a tricky area. If they’re true gifts, free things are not taxable. But when there is an exchange of goods and services — such as a company giving you a product in exchange for a review on the item — the IRS considers it bartering and the value of the sample is taxable as income.

This is an important distinction, especially for bloggers and social media influencers who often receive gifted items from companies. While the monetary income from your activity may be small, the value of samples can add up quickly. You may have to pay taxes for the full amount.

4. Forgiven Debt

If you have debt your lender forgave, the amount could be taxable as income. If you repay your federal student loans with an income-driven repayment plan, for instance, part of your balance may be forgiven if you meet the program’s requirements. That’s great news, but the discharged balance is taxable as income.

For example, say you were eligible to have $10,000 forgiven because you met the requirements of your income-based repayment plan. While you no longer have to make payments on your loan after it’s been forgiven, the IRS will tax you on the discharged amount of $10,000, and you will be sent a 1099-C Cancellation of Debt form. (Here’s what to know if you get one.)

Exceptions to this rule are loans discharged through Public Service Loan Forgiveness, Teacher Loan Forgiveness and debt eliminated through bankruptcy. In those scenarios, you do not have to pay taxes on the forgiven amount.

5. Fantasy Football

Fantasy football is a $3.6 billion industry, one in which the average player spends nine hours a week strategizing. It’s a fun activity that can consume players and take over office spaces. But whether you’re a serious participant or a casual player, fantasy football can have surprising tax implications.

The IRS requires individuals to report winnings from gambling, prizes and hobbies. If you win the office pool or an online league, your prize money is taxable as income.

If your winnings are more than $600, the league or host should send you and the IRS a 1099-MISC form. But even if your winnings are below that threshold and you don’t get a 1099, you still need to report that income on your taxes.

Keep in mind: You may be able to deduct some of the associated costs, too. If you won $1,000 but it cost $500 to enter, you can report only the net profit.

Find Out If You Need to Pay Taxes

When it comes to getting their share of your income, the IRS doesn’t play around. Besides the money you earn from your job, you may owe money for other overlooked activities. If you’re unsure about what to include in your tax return, talk to a tax professional to avoid any penalties or fees.

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The Ultimate Beginner’s Guide for Filing Your Taxes

Find out how to do your own taxes — the right way.

When I was living on my own and working my first job, I decided to do my taxes myself.

I had no real idea how to file taxes, so I made a lot of mistakes. And because I was utterly clueless, it cost me. I missed important deductions and credits. Even worse, I messed up the math.

I ended up owing money to the IRS because of my errors, but I learned a lesson. Afterward, I did my homework and made sure I did my taxes correctly.

Don’t make the same mistakes I did. Find out how to do your own taxes — the right way.

Do I Need to File My Taxes?

The government doesn’t require everyone to file a tax return, so the first step is to figure out if you actually need to file. Three main factors determine if you need to file your taxes:

If you’re single and under the age of 65, you have to file taxes if you make more than $10,350 a year. If you’re married, filing jointly and your household income is more than $20,700, you also have to file a return.

If you make less than those annual amounts and are a dependent on your parents’ taxes, you do not need to file an individual return.

If you’re still not sure if you have to file a return, the IRS recently launched the “Do I Need to File a Return?” tool. It’s a questionnaire that takes about 10 minutes to complete. Once you’re done, the IRS will give you a recommendation on filing a return.

Important Tax Deadlines for 2017

You were probably always taught that the tax filing deadline is April 15. Though that’s normally true, this year is an exception. In 2017, you have three extra days to complete your taxes because tax deadline is April 18.

This year, April 15 is a Saturday, and the IRS doesn’t allow the tax deadline to fall on a weekend. The following Monday is Emancipation Day, a legal holiday in the District of Columbia. The IRS closes their offices that day, so the whole nation gets an extra day.

How to Request a Tax Extension

When learning how to do taxes, remember that if you’re going through a hardship or will be unable to file your return by April 18, you can get an extension. By filing a tax extension request, you can get up to six extra months to complete your return.

An extension can give you a reprieve in filing your return, but if you owe any money to the IRS it’s still due by April 18. If you miss that deadline, you could owe late fees and penalties. (Unpaid taxes can also damage your credit report.)

Documents You Need to File Your Taxes

When you’re preparing to do your taxes, collect the necessary documents ahead of time. It’s common for forms to trickle in slowly, so keeping a folder specifically for tax documents can help you track everything you need.

Here are some common documents that you may need to file your taxes:

W-2: A W-2 is a form your part-time or full-time employer sends you. It shows how much money you made in the past year and how much you paid toward taxes, Social Security and Medicare.

1099: If you earned more than $600 by freelancing or working a side-gig such as driving for Uber, your client will send you a 1099 form. The form shows how much you made last year, but unlike W-2s, no money was taken out for taxes.

Other income records: If you worked a side hustle but made less than $600 for a client, you won’t get a 1099 but you still have to report that income. Keeping a spreadsheet of your earnings or having a separate business bank account can help simplify tax time.

1098: If you made interest payments on your student loans, your lender will send you a 1098 form saying how much interest you paid last year.

1095-A: If you got health insurance through Healthcare.gov, the government will send you a 1095-A form. This says you had qualifying coverage for the year.

Interest earned: If you earned interest from any savings accounts over the year, your bank will send you a form. This will show how much interest you gained.

Bank account routing number: To get your tax refund as quickly as possible, it’s a good idea to sign up for direct deposit when you file your return. To do so, you’ll need your bank account number and your routing number.

Expenses and receipts: If you landed a new job, moved to advance your career or attended business conferences, you can deduct associated costs. Make sure you keep receipts to use when you do your taxes.

How to File Taxes: Which Method?

While you can certainly do your taxes the old-fashioned way, using the paper forms can lead to errors. There are many options that can help you file your taxes more accurately:

Tax software: You can file your taxes electronically using available programs such as TurboTax or Credit Karma’s free filing tool. Some options are free but others have a fee, so choose a program based on your preference. If you make less than $64,000, you can use the IRS’ free filing tool.

VITA sites: If you need more hands-on aid and make under $54,000, you can get free in-person help. Try using an IRS-trained volunteer at a Volunteer Income Tax Assistance (VITA) site.

Hire a tax professional: When doing your own taxes is too confusing or complicated, hire a tax professional. They can handle your taxes for you and ensure you get the maximum refund available.

When choosing which option is best for you, consider how complex your taxes are. If you’re employed and have a side-hustle, but don’t have a business partnership or many investments, using software may be more than enough.

But if you run your own business, own a rental property or have investments, your taxes may be complex enough to warrant professional assistance.

Know Your Deductions and Credits

In the early stages of your career, you are unlikely to have enough deductions to make it worthwhile to itemize. Instead, you can claim the standard deduction of $6,300 and reduce how much of your income is taxable.

But you may be eligible for certain credits or deductions, even if you don’t itemize. Credits reduce what you owe in taxes, while tax deductions lower your taxable income. Both are valuable items to consider when doing your taxes and can help you get your maximum refund.

Here are some of the most common credits and deductions:

American Opportunity Tax Credit (AOTC): The AOTC is worth up to $2,500 per year and includes money paid for tuition and other related expenses.

Charitable Donation Deduction: If you donated money or items to a nonprofit organization, you may be able to deduct the value on your taxes.

Earned Income Tax Credit (EITC): The EITC is a valuable credit that 20% of eligible people miss out on because they don’t claim it on their taxes. The average EITC recipient gets an average of $2,482 by claiming the credit — you could be eligible if are a low-income earner.

Home Office Deduction: If you work from home or run a business from where you live, you may be able to deduct up to $1,500 on your taxes.

Lifetime Learning Credit: With the Lifetime Learning Credit, you can deduct up to $2,000 in qualifying education expenses.

Student Loan Interest Deduction: If you made payments on your student loans, you can deduct up to $2,500 that you paid towards interest on your taxes.

Tuition Fee Deduction: With the tuition fee deduction, you can deduct up to $4,000 in college tuition and other fees.

There are also ways to cut down your property taxes.

File Your Return

When it comes to filing your taxes, you must file both a federal and state return. If you lived in multiple states last year, you need to file a return for each state you resided in.

The only time you do not need to file a state return is if you live in a state that does not charge income tax. There are seven states that fit in this category:

  • Alaska
  • Florida
  • Nevada
  • South Dakota
  • Texas
  • Washington
  • Wyoming

You can submit your federal and state returns using tax software or you can mail in the tax forms. Depending on where you live, where you need to send the forms may change, so check the IRS website before putting them in the mail.

How to Track Your Tax Refund

If you’re eligible for a tax refund, you can track your return’s status and find out when to expect your money by using the IRS’ “Where’s My Refund?” tool. If you opt for direct deposit, you can expect your refund in as little as 10 days after filing.

How Can I Pay My Taxes If I Owe the IRS Money?

If instead of a refund, you owe money to the IRS, you have different payment options. If you use software to prepare your taxes, you can usually pay the money owed electronically through the program.

If you did your taxes on your own or didn’t pay electronically, you can use the IRS payment tool. Just make a payment through your checking account on the IRS website.

If you owe more than you can pay upfront, you can contact the IRS to set up a payment agreement and make monthly installments.

Learning How to Do Your Own Taxes

Figuring out how to file taxes for the first time can be confusing, overwhelming and stressful. Managing the process on your own can be difficult.

Using this guide — and the help of tax software or a professional — can help streamline the process and ensure you handle your taxes correctly.

For more information on how to file taxes and why it’s so important to be accurate, here are four reasons you should never lie on your taxes. You can read up on how to file your taxes for free here.

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