How to choose a college major with loan debt in mind
By ANNA HELHOSKI
Thursday, September 6
Dan Brandt still has $32,000 in student loan debt, after earning his bachelor’s degree in marketing, but he’s not worried about paying it back.
That’s because Brandt chose a major and a career with that debt in mind.
“Money is a big deal for a 17-year-old kid that has nothing,” says Brandt, who graduated from Augsburg University in Minneapolis in 2011 with $55,000 in student debt. “I knew the salary ranges in marketing could make a nice living, but I was more concerned with finding a place I enjoyed working at,” adds Brandt, who is now a marketing manager at Best Buy’s headquarters.
If you, unlike Brandt, don’t know what you want to study, you can choose a major that won’t leave you with student loans you can’t repay. Here’s how.
EXPLORE JOB TITLES AND PROSPECTS BY MAJOR
Start by listing your interests and skills. There may be a clear fit — if you’re adept with numbers, for example, you might consider accounting.
Next, research careers by matching a major to one of the “Occupation Groups” listed in the U.S. Department of Labor’s Occupational Outlook Handbook . Each group lists positions along with descriptions, educational requirements and projected job growth. Consider contacting your college’s career office to link up with alumni who studied what you’re interested in, to see their career path.
RESEARCH POTENTIAL EARNINGS
Your major could make a big difference in lifetime earnings: The disparity between the lowest- and highest-paying majors is $3.4 million, according to a 2015 report by the Georgetown University Center on Education and the Workforce.
“There are people who really want to go to into social work or drama, but money is going to be an issue,” says Brad Hershbein, economist and director of information and communications services at the W.E. Upjohn Institute for Employment Research. “You have to know that, and make an informed decision about what it’s going to be like after you graduate.”
Research median salaries rather than average salaries, Hershbein says.
“The example I always use is if you put Mark Zuckerberg (Facebook’s billionaire co-founder and CEO) in a room with 10 other people who have no money, the average of the group is still inordinately wealthy,” Hershbein says. “You don’t care about the average so much as the median.”
The average starting salary for the class of 2017 was $50,516, according to the National Association of Colleges and Employers Summer 2018 Salary Survey, but median earnings — where half earn more and half earn less — start at $27,000, according to 2014 research by The Hamilton Project, an economic research group at the Brookings Institution.
To find data on salaries, use sites like Salary.com or Glassdoor. Include “entry-level” in your search, along with specific cities or regions for more accurate results.
FACTOR EARNINGS INTO BORROWING
Before you take out student loans, submit a Free Application for Federal Student Aid, or FAFSA, to qualify for gift and earned aid, including grants, scholarships and work-study. Find private scholarships with scholarship search engines, such as the U.S. Department of Labor’s CareerOneStop scholarship finder or Scholarships.com.
If you need loans and you’re not sure how much to borrow for college , you can keep repayments manageable by aiming for a monthly payment that won’t be over 10 percent of your expected after-tax take-home pay each month in your first year after school.
For example, If you expect to make a starting salary of $46,000, then borrowing about $24,000 for college means you can afford a monthly payment of $257. Use an undergraduate student loan calculator, like one from The Hamilton Project , to see what it would take to repay debt based on your major.
WHEN IN DOUBT, SWITCH
If you start school without your major picked, it’s OK. College is the place to explore potential career paths.
“Don’t be deterred by risk to pursue a more difficult major; if you try computer science and it doesn’t work out, you can always switch majors,” says Artem Gulish, a senior policy strategist at Georgetown University Center on Education and the Workforce. “No one can really know what they can be good at if they haven’t tried it.”
Realize that if you do change your path, it could take longer to complete your degree, which may mean taking on more debt. But it could also lead to a career that motivates you, potentially boosting your earnings and the ability to repay your loans.
This article was provided to The Associated Press by the personal finance website NerdWallet. Anna Helhoski is a writer at NerdWallet. Email: annanerdwallet.com. Twitter: AnnaHelhoski.
NerdWallet: How much to borrow for college
U.S. Department of Labor’s Occupational Outlook Handbook
Hamilton Project: Undergraduate student loan calculator
Analysis: New Bill Would Override State Usury Caps for Fintech Companies, Payday Lenders
By Kate Patrick
The House of Representatives just passed a bill that would override state usury caps on interest rates made by financial technology (fintech) companies or online and payday lenders, but it’s facing opposition from consumer financial protection advocates.
The bill — the Protecting Consumers’ Access to Credit Act of 2017 — aims to accelerate fintech innovation and encourage business growth. There is a similar bill stalled in the Senate over consumer financial protection concerns.
By allowing online companies to make loans at interest rates that may exceed some states’ usury limits, more small businesses and consumers may receive loans, thus improving credit access for entrepreneurs and needy individuals.
If passed, the bill would effectively cripple states’ ability to regulate online lenders and some fintech companies, and would encourage fintech companies to apply for national bank charters instead of state bank charters.
“This is a larger issue in at least two dimensions: first, the fintech companies have been trying now for at least two or three years to get charters from the controller of the currency,” said Lawrence White, professor of economics at New York University’s Leonard N. Stern School of Business.
“The fintech companies have wanted a similar kind of national charter because they are obviously going to be headquartered someplace, but especially for fintech companies nowadays, scale is everything. They want to be able to operate and access as many customers in as many places as possible. They’re relatively small, relatively lean, and having to deal with 50 states would do-in their business model.”
Some states — like Arizona — have already told federal regulators to stay out of fintech and let states handle the regulation. Federal regulation overriding state authority in this matter means states will lose out on state banking charter revenue.
Varo Money, a fintech startup, became the first fintech company to receive preliminary approval for a national bank charter from the Controller of the Currency on Tuesday. If Varo Money nabs the charter, it will be “the first all-mobile national bank in the history of the United States.”
“This (House) bill advances the ball for (fintech companies) without waiting for the Controller of the Currency to give them a charter,” White said. “It’s giving them, in essence, a national charter. I’m guessing it will get passed and signed.”
White thinks the bill has a good chance of passing because current regulation of credit card companies sets a national precedent.
“The thing that echoes here is this same idea of being able to operate across the 50 states specifically with respect to usury laws was very important for credit card companies and still is important for credit card companies, so there’s adequate precedent for lenders having this kind of national charter to override the local state limits,” he said.
Small business coalitions, small bank associations and fintech groups sent a letter to senators Mark Warner (D-Va.) and Patrick Toomey (R-Pa.), co-sponsors of the Senate bill, and representatives Patrick McHenry (R-N.C.) and Gregory Meeks (D-N.Y.), co-sponsors of the House measure, in support of the bill last fall.
Some of the signers have also lobbied on the bill, including the American Bankers Association, Independent Community Bankers of America and the U.S. Chamber of Commerce.
Other notable groups who have lobbied on the bill include the National Association for the Advancement of Colored People and Harley-Davidson (which offers financing for the motorcycles it sells).
Rep. Emanuel Cleaver, D-Missouri, released a report on fintech companies and online lenders a few weeks ago, raising concerns that they disproportionately lend to poorer individuals and people of color and may discriminate against them as their algorithms for calculating interest rates are “black boxes” lacking transparency.
The Center for Responsible Lending told InsideSources that because of consumer financial protection concerns, there is “equal speculation that the bill may not pass.”
“The top line is, there’s a narrative that this bill is necessary in order for fintech to innovate and evolve and expand credit access,” said the CRL’s federal advocacy director Scott Astrada. “One, on its face, is not completely accurate. You could still make affordable loans under the current reg structure. What you can’t do is charge 400 percent interest rates. The bill is a very overly broad, all encompassing solution to a problem that doesn’t exist at this state.”
Astrada thinks financial innovation isn’t stifled by state regulation. On the contrary, he said, “financial innovation and technology should evolve alongside preexisting law.”
“What’s more at stake for us is the pre-emption of state law,” he said. “We see it continues to be the strongest bulwark for consumer protection. The state attorneys general have been aggressively pursuing bad actors and predatory lenders. South Dakota recently passed a ballot initiative, and this week Colorado put out a ballot initiative for a 30 percent cap on APR. These states have made an unequivocal claim that predatory lending is a problem and they’ve addressed it.”
Astrada fears the bill is too broad and will encourage malpractice in the lending community to the detriment of consumers.
“This bill would essentially open the floodgates and loopholes and target individuals unable to have the protection of the state law,” Astrada said. “That’s always the concern. We’ve expressed this to both co-sponsors of the bill in the House and the Senate. During the House markup, a lot of members raised this issue as a big concern.”
NYU’s White believes consumers are fully capable of discerning predatory lenders apart from honest ones, especially since there is so much literature available on predatory lending available.
“By now I think any consumer understands they ought to shop around and be using their local bank and local credit union,” he said. “Sometimes they end up in the hands of a payday lender and my guess is fintech companies are probably going to be doing better than the payday lenders.”
But Astrada thinks the bill will only encourage wolfish payday lending across state lines: “Senator Warner has publicly said there is a payday lending problem with this bill. We’ve seen lenders aggressively pursue regulatory loopholes.”
Given that about two-thirds of Americans can’t pass a basic financial literacy test, some regulators and think tanks believe it’s important to pre-empt financial malpractice with regulation as much as possible.
Further complicating the debate is whether young fintech companies can sustainably grow and innovate in a state regulatory environment. White says it’s extremely difficult, given that their business models rely on interstate e-commerce.
“They need some kind of a national presence, otherwise their business model just kind of collapses,” he said.
“A lot of the concern we have for this bill are what we see in the current marketplace are high APRs and recurring default rates,” Astrada added. “While there is room for innovation, it can’t come at the expense of consumer protection. A toxic loan is a bad loan. No amount of innovation is going to change that.”
ABOUT THE WRITER
Kate Patrick reports technology and finance news for InsideSources.com.
Times grants anonymity to administration official for essay
By DAVID BAUDER
AP Media Writer
Thursday, September 6
NEW YORK (AP) — It was an extraordinary decision at a tense time for editors at The New York Times: a senior official at the Trump administration wanted to tell the world that some who work for the president try to blunt his worst instincts, but wanted the cover of anonymity to avoid being fired.
The Times agreed and posted the column titled “I Am Part of the Resistance Inside the Trump Administration” on Wednesday, provoking fury from the man who frequently revs up supporters by railing against “fake news” and the “failing New York Times.” Trump called the move gutless and demanded the Times reveal the author’s identity “for national security purposes.”
The internet was abuzz with speculation on who wrote the column, which veered in tone between a hostage note and a reassurance to Americans that, as the writer put it, “there are adults in the room.”
The decision was in the purview of James Bennet, editorial page editor, and James Dao, op-ed editor, with publisher A.G. Sulzberger weighing in, a Times spokeswoman said. The newspaper’s executive editor, Dean Baquet, was not involved because the news pages are his responsibility, and the column appeared in the Times’ opinion section.
That led to a Times reporter, Jodi Kantor, tweeting that “Times reporters must now try to unearth the identity of an author that our colleagues in Opinion have sworn to protect with anonymity?”
Dao told a Times reporter that the piece was submitted last week through an intermediary, and anonymity wasn’t granted until editors were confident in the writer’s identity. While that’s rare for the opinion pages, it’s not unprecedented, and Dao said the material in the essay was important enough to publish.
“We believe publishing this essay anonymously is the only way to deliver an important perspective to our readers,” the newspaper said.
In June, the Times published a piece from an asylum seeker who was in a Trump administration family detention center, not identifying her because of gang-related threats she received. In 2014, a woman from Pakistan was not identified for writing an editorial page blog item to protect her from the Taliban.
But in Wednesday’s case, the person was from the highest reaches of the U.S. government.
“It’s extraordinary,” said Frank Sesno, director of the School of Media and Public Affairs at The George Washington University. “I have never seen anything like this. I can only imagine the conversations at the New York Times about publishing such a thing. If there’s any question about the role that journalism plays in a democracy, this puts it to bed.”
Sesno said the Times’ credibility is on the line “if this person turns out to be a window-washer somewhere.
“But there’s no way a responsible news organization would do that,” said Sesno, a former CNN Washington bureau chief. “I have to believe that the top people at the Times were part of this decision, because it was so unusual and so explosive.”
The author wrote that “there were early whispers within the Cabinet of invoking the 25th Amendment, which would start a complex process for removing the president. But no one wanted to precipitate a constitutional crisis.” That speaks to the writer either being in the White House or having access to people who are there regularly.
Kyle Pope, editor of the Columbia Journalism Review, said the decision was akin to the newspaper’s news pages protecting a source with anonymity.
“What’s different here is the scale of it,” he said. “I do think it’s a powerful statement. I wonder how the editorial side is keeping (the source’s identity) from the news side.”
He said it’s a situation in which the rules have to be made on the fly.
“If I was in this decision-making process, I would take the risk,” Pope said. “It’s a risk worth taking because the message is so powerful.”
White House Press Secretary Sarah Sanders said the administration was “disappointed, but not surprised, that the paper chose to publish this pathetic, reckless and selfish op-ed.” She called it another example of the liberal media’s effort to discredit Trump.
The newspaper’s spokeswoman, Eileen Murphy, said the Times was incredibly proud to have published the piece, “which adds significant value to the public’s understanding of what is going on in the Trump administration from someone who is in a position to know.” The newspaper had no response to Trump’s tweet that the identity be revealed for national security reasons.
The article was a coup for the Times in its endless fight for supremacy with The Washington Post, coming a day after the Post published excerpts from an upcoming book on the Trump administration by Post legend Bob Woodward.
Some of what was written in the Times column, in fact, echoes material from Woodward’s book. The book said Defense Secretary James Mattis has purposely not acted on a presidential directive to assassinate Syrian leader Bashar al-Assad, and that former Trump economic adviser Gary Cohn once removed a document from the president’s desk that would have ended a trade deal with South Korea.
The Times column said that those working for Trump made sure sanctions were placed on Russia for poisoning a Russian spy in Britain, despite the president’s reluctance to do so.
“We fully recognize what is happening,” the anonymous author said. “And we are trying to do what’s right even when Donald Trump won’t.”
Opinion: Trump Aides Worry About Another Summit With Kim
By Donald Kirk
WASHINGTON — Here in the swamp of the American capital, you appreciate how easy it is to forget about Korea when North Korea isn’t firing missiles and testing warheads or, conversely, when no one’s talking about another summit between President Trump and Kim Jong-un.
That’s not to say no one is raising the possibility, but it’s not in the news. Nor, for that matter, is there much news about President Moon Jae-in’s interaction with North Korea. Assuming Moon does go to Pyongyang for his third summit with Kim, you’ve also got to believe he’ll be impressing on his host the need for another summit with Trump in the interests of getting around a few, shall we say, “misunderstandings.”
The primary misunderstanding is there’s no definition of “complete denuclearization,” as called for in the brief statement so ostentatiously signed by Trump and Kim in Singapore on June 12.
Actually, while you see very little in the media about what’s happening in Korea, you hear that some of Trump’s top aides would prefer their boss not meet Kim again. That’s because there’s no telling what Trump will do.
Everybody was caught completely by surprise by Trump’s decision, with no prior consultation with Defense Secretary Jim Mattis, to cancel joint U.S.-South Korean exercises that were to have been held last month. Trump may have talked over that idea during his 28 minutes alone with Kim when nobody else but their interpreters were in the room, but he did not mention it in the open session right afterward at which he sat down with Secretary of State Mike Pompeo and National Security Adviser John Bolton facing Kim and his top aides seated opposite them.
Now the concern is what Trump might do or say if he meets Kim again. Might he, with no prior discussion with Pompeo, Bolton or anyone else, simply tell Kim, right, we know, the Korean War is over so let’s sign that “peace declaration” you’ve been asking about. That would be fine by Moon, who also wants a peace declaration formally ending the Korean War, but most Americans inside the policymaking process are not enthusiastic about the idea. They see North Korea going from there with demands for a peace treaty, withdrawal of American troops and destruction of the elaborate structure set up by the Korean War armistice of July 1953.
Probably the most frustrating worry, for many at top levels of government, is Trump’s unpredictability, his volatility, his short attention span and his reluctance, some would say refusal, to do background reading and sit through briefings, as needed to be sure of what he’s doing. Bob Woodward, the famous investigative journalist who, together with Washington Post colleague Carl Bernstein, broke the Watergate scandal that led to the downfall of Richard Nixon as president, has come out with a book revealing not only Trump’s ignorance but very possibly his stupidity.
Woodward writes that Mattis, after briefing Trump on defenses against North Korean missiles, was “particularly exasperated and alarmed, telling close associates that the president acted like — and had the understanding of — ‘a fifth- or sixth-grader.’ ” The White House chief of staff, John F. Kelly, is quoted saying, “He’s an idiot, it’s pointless to try to convince him of anything, he’s gone off the rails.”
Or, if Trump is not really all that stupid, he’s way out of his depth on North Korea. He caught military commanders completely by surprise, for instance, when he said that the war games conducted by U.S. and South Korean troops were “provocative.” Who put that incendiary word in his mouth? Kim Jong-un, perhaps, in their one-on-one session.
Trump may not know it, but his judgment on the value and role of U.S. forces in Korea is at odds with the outlook of his bedrock voters, many of whom have served in the armed forces or come from families with military backgrounds. How can Trump claim to be making American “great again” when he shows such disrespect for what American forces have been doing in Korea since the Korean War?
It’s not likely that Trump has studied the history of the American role in rescuing South Korea from North Korean and Chinese forces in the Korean War. In his second summit with Kim, he could decide to withdraw American forces from South Korea as an economy measure, saying they were hardly worth the expense while the U.S. suffers from an enormous trade deficit with the South.
In fact, Trump lacks the intellect, the vision or the understanding needed to make important decisions affecting U.S. forces overseas. That’s why those close to him think the risks of a second Trump-Kim summit outweigh the gains. Kim is not going to say, Mr. President, thank you so much, now we will start dismantling our nuclear program. Trump may not want to admit it, but that’s not going to happen.
ABOUT THE WRITER
Donald Kirk has been a columnist for Korea Times, South China Morning Post many other newspaper and magazines. He wrote this for InsideSources.com.