Glossary of Financial Aid Terms for Parents

As the parent of a high school student you are about to learn a lot about the world of college financial aid. To help make sure your child gets the most out of college financial aid, here are some terms you’ll need to know.

• Federal Student Aid: This is financial aid from the federal government which is designed to help families and students pay for education expenses at an eligible college or career school. It consists of grants, loans and work-study programs. You always want to maximize the amount of federal student aid before moving on to other college financing options.
• FAFSA - Free Application for Federal Student Aid: This document is a summary of your current financial situation. It provides an overview of your family’s ability to pay for a college education. Completing and submitting this information correctly is the first step to gaining access to federal financial aid. It may also be used by your state, college, and some private providers to determine your student’s eligibility for additional types of aid.
• SAR - Student Aid Report: Federal Student Aid will provide a summary of the information you submitted on the FAFSA. It is important that you review the SAR to make sure it is correct and complete, as many financial aid decisions will be based on this information. If you find a mistake, you will need to correct or update your FAFSA. If your financial situation has changed since you filed the FAFSA, you may be able to make certain updates.
• EFC - Expected Family Contribution: This number is used to determine your student’s eligibility for federal financial aid. It shows how much money the government expects that your family can contribute to the cost of your child’s education.
• Financial Aid Award Letter: Once your child’s selected colleges have reviewed the information on your FAFSA, they will provide you with a financial aid award letter which will detail the expected Cost of Attendance (COA) at their institution, as well as any financial aid for which the school believes you are qualified. Be aware that some schools may include student loans as part of their financial aid package.
• Grants: This is a form of financial aid which is usually based on financial need. In most cases, grants do not have to be repaid unless your student withdraws from the school.
• Scholarships: This is another form of financial aid, but scholarships are usually based on merit, activities, group memberships, medical conditions, or some other factor. They are made available by the school, community and religious groups, non-profit and for-profit organizations, and usually involve some type of application process. In most cases grants do not have to be repaid.
• Work-Study Programs: This form of financial aid provides part-time employment opportunities for undergraduate and graduate students with financial need. This gives your student an opportunity to earn money to help pay for his or her college expenses. The program usually encourages community service work and some type of work which is related to your student’s course of study.
• Student Loans: This is money that is borrowed from the federal government, school or a private lender that will need to be repaid with interest. Both federal and private student loans are available.
  
  

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Why The Cheapest Car Insurance Is Not Always the Best

Bargain hunters are always looking for the cheapest prices. Smart bargain hunters know,

however, that buying something based strictly on the lowest price often means lower quality and sometimes results in losing money. Smart bargain hunters also know that you have to do a little digging (research wise) to find the real bargains. That's why they're smart. If you are shopping for the best deal in auto insurance, you would be wise to follow the smart bargain hunters lead. Researching the fine points regarding auto insurance may take a little time and effort, but it's almost always worth it. And with the internet it's not as hard as it used to be. Below you will find some helpful bargain hunting tips as I explain why the cheapest car insurance is not always the best.

There's Cheap and Then There's Cheap

Before we start, it's important to understand what is meant by "cheap insurance." There's really two ways to go here. The first is "cheap" referring to minimum coverages and the resulting lower premiums. The second has to do with cheaper insurance prices at the cost of better service. What you will find is that both of these aspects bleed into one another and maybe they're just two ways of looking at the same thing. Confused? We are getting a bit ahead of ourselves, so let's take a step back and look at each aspect separately.

Cheaper Premiums by Cutting Back on Coverage

It's tempting to cut your coverage down to bare minimums and take on a higher deductible in order to pay the lowest monthly premiums available. All states have mandated minimum liability insurance limits and, as you might expect, each state's limits are different. And those minimums are pretty low. Take Iowa, for example. Iowa law requires drivers in the state to carry the following minimum coverage:

• Bodily Injury: $20,000 per person, $40,000 per accident.
• Property Damage: $15,000.

Sound like enough?  We all know that bodily injury costs (hospital expenses, lost wages, rehab visits, etc.) can add up very quickly, especially if the injuries are serious and/or there's more than one person injured. And if you've ever been in a collision, you know that spending $15,000 to repair even one vehicle doesn't take much damage. Which begs the question: If you get into an accident in Iowa that causes serious injuries to several persons, and you are at fault, who is going to pay the difference between your minimum coverages and the actual (huge) costs for those injuries? The answer is: you. Where are your savings for cheap insurance then? Gone, along with possibly your vehicle, your children's college fund and the equity in your home. 

Now, I know our example is an extreme one, but certainly not out of the realm of possibility. And even if your accident is much smaller, the total costs out of your pocket could still outstrip any savings you were enjoying with cheap coverage. Outstripped by a mile.

At this point, we've only discussed liability insurance. In other words, coverage that pays for damage to the other guy. What about the damages to your car? If you stick to state minimums, your premiums will be smaller but you'll be withoutcollision and comprehensive coverage, and that will likely mean a pretty penny coming straight out of your pocket if you get into an accident or hit by bad weather. Or flood.  Or a theif. 

Cheap Insurance = Less Service

Some people comparison shop without realizing that they are comparing apples to oranges. Well, not when they're comparing actual apples to oranges, but you know what I mean. This happens all the time with auto insurance. People choose a cheaper priced policy thinking they are getting the same coverage as a more expensive one. In most cases, they are not. It's all in the fine print. You know, the stuff most of us don't bother to read. Usually these details in coverage have to do with all those extra services some insurers provide and some do not, like paying for a rental while your car is in the shop. Or how the value of your totaled vehicle is calculated. All those little things that add up to one big thing: less money for you.

It all boils down to the old adage: cost does not equal value. If you really want "cheap insurance," that is, insurance that will save you money over time, don't equate cheap with lower premiums. Seriously analyze your coverage needs in light of all the important factors, like where you live, who will be driving your car, and what extra services you will require. Then do a side-by-side comparison of as many policies as you can get hold of, and don't forget to include any offered discounts. That's what the smart bargain hunters do.

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Buying an Airplane: Can You Afford It?

The Cost of an Airplane

Buying an airplane can definitely be affordable, but it’s not for everyone. Your specific financial situation and how you measure value as it relates to aircraft ownership will determine if you’re ready to take the plunge into aircraft ownership.

The cost of owning an aircraft is multi-faceted and can seem complex at first, but if you research and prepare, you might find that it’s not as overwhelming as you first thought, and might be more affordable then you initially thought. What you don’t want is to be surprised at additional costs uncovered after you purchase an airplane. Here’s the breakdown of what to expect.

The Purchase Price

There’s a rule of thought that says that if you can afford a car, you can afford an airplane. This may be true, but everyone’s financial situation is a little bit different. The general rule is that if you can afford a car/boat/vacation home, chances are you can afford an airplane.

The car analogy comes from a calculation for a small single engine airplane or light sport aircraft in the $50,000 range. Using an aircraft loan calculator such asthis one from AOPA, we find that you can expect to pay around $400 per month for a 20-year loan with 6.5 percent interest. Obviously, this is a fluid number, depending on the loan term, interest and how much money you might be able to offer for a down payment.

You can, in fact, purchase a small single-engine aircraft for less than $25,000, but it will probably be very old and in need of lots of updates. Pilots can get a good deal on older aircraft, but usually end up spending a significant amount of money on updates, such as new radios, a GPS system, maintenance and more in order to make it into something they can fly comfortably.

A $400 per month payment is very reasonable for someone that might use the aircraft often, especially if there is added value in it, such as business use, tax credits and time savings. But don’t forget that the actual purchase price is just one factor in the cost equation.

Operating Costs

Aircraft operating costs can be divided into fixed costs and variable costs. Fixed costs are costs that don’t change, such as the loan amount, insurance and hangar rental. Variable costs include fuel, oil and maintenance costs.

When you are determining how much you can afford, you’ll have to include these costs. You can get an estimate of aircraft operating costs on AOPA's website or atconklindd.com.

For a small single-engine fixed-gear aircraft like a Cessna 172, operating costs can be between $100-$200 per flight hour.

Here’s a short list of costs to consider beyond the purchase price of the airplane:

• Fuel
• Oil
• Regular maintenance inspections, such as the required annual inspection, avionics and instrument inspections.
• Engine overhaul cost
• Ramp tie-down or hangar fees
• Insurance
• Landing fees
• Aircraft accessories, such as headsets, engine covers, etc.

A small airplane such as a Cessna 172 can cost up to $30 per hour in fuel alone during flight. If you fly 200 hours in a year, it’ll cost $6,000 in fuel alone per year.

Is it Justifiable?

Whether or not you can justify the cost of a private aircraft depends largely on your sense of financial security and your opinion on quality of life.

Many pilots justify their aircraft purchase by factoring in the amount of time saved, the reduction of time spent at airports, and the flexibility to take off whenever they want, wherever they want to go.

There are also many ways to reduce the costs of ownership, such as co-owning, leaseback options, renting the aircraft out to others, or flight instructing if qualified. These all come with advantages and disadvantages, of course, but many pilots find that the costs are much more manageable by implementing one or more of these measures.

Some people can’t fathom spending such a large amount of money on an airplane they’ll fly once in a while. For others, the lifestyle and convenience of owning an airplane becomes very justifiable. It’s a personal opinion and one that, unfortunately, this article cannot solve for you.

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How to Deal With a Bully at Work

Think you work with a bully? Do you regularly feel intimidated, dread to work near a particular coworker, or you’re yelled at, insulted, and put down? Does a coworker talk over you at meetings, criticize you, or steal credit for your work? If you answer yes to these questions, chances are good that you’re one of 54 million Americans who have been attacked by a bully at work.

You know you’re working with a bully when the bully picks out your mistakes and constantly brings them up. Or worse, the bully gossips about you, tells lies to your coworkers, and even sabotages your work. If you dread going to work, you may have a bully coworker or boss.

If your employer won’t help you, and a recent study says they often won’t, these are the actions to take to defeat the bully.

You’re Not Alone: A Bully Lives in Many Workplaces

The Zogby study, in conjunction with theWorkplace Bullying and Trauma Institute (WBTI), found in 2010 that:

• 50% of Americans have not experienced or witnessed bullying, but 35% have been bullied; 15% have witnessed bullying.
• Bosses comprise 72% of bullies.
• More men (62%) are bullies and women are the most frequent targets of bullies (58%). Women bullies target other women (80%).
• Up to 81% of employers are perceived as doing nothing and resisting taking action when targets of bullying fill out a survey. In the general public, only 44.8% perceive the employers as doing nothing.
• 45% of people targeted by a bully experience stress-related health problems including debilitating anxiety, panic attacks, and clinical depression (39%).

How to Deal With a Bully

You can deal with a bully and change the bully’s behavior if you are willing topractice personal courage. But, you must do something. The bully will not go away; if you make yourself an easy target, you will only encourage the bully. Here’s how to deal with your office bully.

Set Limits on What You Will Tolerate From a Bully

Most importantly, once you have set the limit in your mind, exercise your right to tell the bully to stop the behavior. You might want to rehearse these steps with a friend so that you are more comfortable responding when the bully attacks.

• Describe the behavior you see the bully exhibiting – don’t editorialize or offer opinions, just describe what you see. (You regularly enter my cubicle, lean over my shoulder, and read my personal correspondence on my computer screen.)


• Tell the bully exactly how his behavior is impacting your work. (Because much of my work is confidential, these actions make me feel as if I need to hide what I am working on from you, or change screens which is a waste of my time.)


• Tell the bully what behavior you will not put up with in the future. (In the future, you are not to enter my cubicle unless I invite you to come in. This is my private work space and your actions are unwelcome.)


• Stick with your statement and if the bully violates your space, move on to confrontation.

Confront the Bully With His Own Behavior

Confronting a bully is scary and hard. But, as Jonathan Littman and Marc Hershon suggest in I Hate People (compare prices), bullies are “only effective when they’re on solid ground. Ground that you can take away.” They suggest that, “Next time he swears or heaves a phone book, call it out. Point out that he’s swearing or yelling, and leave the room. Or end the call.”

“Remember: You’re the adult dealing with a tantrum. No wise parent gives in to a child’s fit because it just leads to more fits.

”You’re wrapping Bulldozer’s fury with tough love. By making statements about his conduct, you’re putting him on notice. Keep up your game and by the second or third attempt, Bulldozer will tire of spinning his treads in the sand.”

This confrontational approach works in meetings, too. If the bully is talking over you with complaints and criticisms, ask him a direct question about what he recommends instead. If that doesn’t work ask him to leave the meeting until you finish your discussion. If he refuses, end the meeting and reschedule the meeting without him.

You need to call out the bully on your terms.

Document the Bully’s Actions

Any time you are feeling bullied or experiencing bullying behavior, document the date, time and details of the incident. Note if another employee witnessed the incident. If you eventually seek help from Human Resources, documentation, especially documentation of the bully's impact on business results and success, gives HR information to work with on your behalf. The bully is not just hurting your feelings; the bully is sabotaging business success.

If the bullying occurs in email or correspondence, maintain a hard copy of the trail of emails and file them in a folder in your computer.

Your Coworkers Are Targets of the Bully, Too

Note whether the bully pulls the same behavior with your coworkers. Ask your coworkers to document the bully’s behavior and any scenes they witness when the bully targets any coworker. If five of you experience the bullying, and five of you document, then you build a case to which HR and your management can respond on solid ground. They need evidence and witnesses, even if everyone knows, that the bully is a bully.

Also, if you decide to press charges in the future, you need witnesses and documentation. The Zogby-WBTI study indicates that only 3% of bullied employees sue and 4% complain to state or federal agencies. So, it’s best to confront the behavior, but don’t rule out the possibility of a suit, especially if youremployment is terminated or threatened by the bully.

Tell Management and HR About the Bully

You’ve tried to implement these recommendations, but they aren’t working to stop the bully. It's time to get help. Go to HR or your manager with your evidence, especially the evidence that demonstrates the impact of the bully on the business, and file a formal complaint. Most employee handbooks describe the HR investigation process that your complaint sets in motion.

Hope for the best resolution but be prepared to explore other options so you have less contact with the bully. You may even need to find a new job. You may never know what HR did about the bully; you can assess the impact by how he now treats you.

You can address the behavior of a bully in your workplace. With persistence and personal courage, you can neutralize the bully behavior and regain your conflict-free workplace.

Have you been bullied or witnessed bullying at work? Readers are sharing their stories.

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