Posted On: 2005-11-10Length: 32:20
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Good morning everyone it is Thursday, November 10, 2005. Welcome to the Financial Aid Pod cast episode 112. My name is Chris Penn, and I am hosting today's show as I do everyday really. Got a lot to talk about today, today is the big day when it comes to education, financial aid, the budget reconciliation in Washington, so there will be a lot of politics talk today. Got a scholarship from the AICPA, and some really great Pod Safe music we're going to continue with the great hits from the Pod Safe Music Network as well. Let's get started with today's news.
Two things before I start I should apologize for, one I still sound like garbage from this cold that just won't go away; two there's apparently a work crew of some kind doing something on the roof of our offices here and so if you hear a lot of industrial noises like that jet vac they just turned on, that's what that is, unfortunately nothing that I can control, so I apologize in advance but I do want to get this show out. Today is the day that the House votes on the Budget Reconciliation Bill we've been talking about this for a couple weeks now. The bill as written in the House basically increases the cost of paying off student loans by an additional $6,000 on average and would cause and over all increase in fees for variety of student loan programs. We've talked about the increase in the PLUS Loan rate and a whole bunch of other things. What's interesting about this and this has been pointed out in a couple of places in the news, the Daily [2:02] on line even in USA Today and on CNN Money, there's a bunch of tax incentives and tax breaks and stuff that are being extended as well. In the same Budget Reconciliation Act, as well as other changes to Federal programs; for example they've increased fees to Medicaid patients, 300,000 people will become ineligible for food stamps and course the 14 billion from Federal Student Aid.
But at the same time, there's a deduction for capitol gains that is currently in place that would be extended. Basically if you earn more than $1 million a year in dividend income, that is to say if you have a portfolio of stocks, bonds or anything that yields taxable dividends, the capital gains tax cut that was passed in 2001, will be extended. And that basically gives people who make a $1 million or more in dividend income an additional $220,000 in tax credits I guess. I can't tell if its tax credits or if it's just a deduction. Most of the ridderick in the papers is slanted one way or the other and there are not a whole lot of facts about it. But from what I can tell it's basically deals with how dividend income is computed. The sum total for that would be about $35 billion. A number of people point out quite rightly that if the Congress were to basically not extend that tax break on dividend income, they would be more than able to fund the cuts to students loans and still have plenty of money left over to keep Medicaid and food stamps eligible. If you are interested, I'm sure you will see this story all over the news today, if you're interested in doing something at the last minute, you certainly can-the best way to do that of course is to contact your representative in the House at www.house.gov probably even better than that, that would be to give them a call especially if you have free cell phone minutes and stuff like that. Go to www.house.gov, and just give them a call, the number there is 202-224-3121 and let them know what you think about the things that are going on with the Budget Reconciliation Bill that is currently in the House. Again, there number is 202-224-3121 and you'll want to talk to the representative from your districts. If you're not sure where your district is, right on their website you can type in your zip code. For example, 02169 is ours here at the office, I believe it's 5808, yes, William Delahunt is our Representative for the 10th District of Massachusetts. So, I'll give him a call this morning and let him know. I'm pretty sure he's going to vote along the party lines against this Reconciliation Act, may not have to necessarily offer him that much encouragement.
Let's see, in other news. In West Virginia, unfortunate news coming from there; the Promise Scholarship Program has been helping high school students from West Virginia go to college, but with the structural deficits, we've talked about this the other day with regard to state budgets; With the structural deficits, the legislature in Virginia is looking at trying to restructure that scholarship from basically being a merit scholarship either possibly to being a need based scholarship or making the criteria for qualifying the scholarship more difficult because they are basically running low on money in the state of West Virginia. The scholarship program costs the state of West Virginia approximately $39 million a year. This is part of a disturbing trend and I've talked about this in the past, I've talked about it yesterday actually with the Committee of Higher Education report. Basically, what seems to be happening across the board is a number of different - the conspiracy theory in the tin foil hat folks would say that it's a giant plan to make America really stupid. In some ways you can kind of understand that because, well let's face it, an uneducated population is an easier population to control. But I don't necessarily subscribe to the tin foil hat and all that stuff. What really seems to be happening though, regardless of whether it's orchestrated or not, is that education, especially higher education funding, is really being attacked and used as a means of funding other priorities.
When it comes to the future of America; the future of America is contingent upon how we educate our citizens and how we prepare them for the challenges in the years to come. The students that are in school now, in 10 years will be Middle Management Corporation or running their own small businesses. In 20 years they'll be running everything. If they are ill prepared to do so, then the country as a whole will basically not have the resources it needs to remain competitive; and by that I mean the intellectual resources that we need to remain competitive in the global market place. It's not a secret, you know China, India, a lot of other really big nations are gunning for the United States in terms of higher education, in terms of degrees, in terms of patents, in terms of research and development. If the United States would like to continue to enjoy its existing levels of prosperity it needs to fund higher education and make it a top national priority. Certainly I would say if the rhetoric of the dividend income tax break is true, then certainly the national priority of educating and preparing America for the future would take, at least in my book, takes precedence over dividend income tax breaks. If you're making over $1 million in your dividend income you can probably afford to pay a little bit extra. I realize that that's not necessarily fair in the sense of everyone paying the same percentage of weight but at the same time the wealth of the people who are in that category of millionaires with dividend income, the wealth that they are enjoying is basically built on the back of education. Education creates the companies that provide this income. Education creates the workers who work at these companies who provide that income, so if they would like to see that income continue to roll in, they need to put more fuel in the gravy train. The gravy train doesn't run without fuel and the fuel of course is education. That is my political rant for the day I guess. Not too much else otherwise in the news. The Budget Reconciliation Act is taking the lion's share of the news. So let's do a piece of Pod Safe music.
Let's kickoff today with Audiofarm. Let's do "The Groove" by Audiofarm from the Pod Safe Music Network. It's got a really, really catchy acoustic beginning here, I love it.
Live performance of "The Groove" by Audiofarm from the Pod Safe Music Network. Really terrific music, I really love the Pod Safe Music, I'm so glad I brought it back. I realize that my musical tastes may not be everyone else's and if you just want to skip through the music parts of the show please feel free, I certainly wouldn't be upset. Gosh, I love the music. It's so nice. I wonder how the folks going to the expo are doing.
All right today's scholarship update. The AICPA Scholarships for minority accounting students. The AICPA for minority accounting students provide competitive awards to the outstanding full-time undergraduate minority students at accredited institutions to encourage their selection of accounting as a major and entry into the profession ultimately achieving the CPA designation. Full-time graduate students seeking a master's degree in accounting or taxation. If they are undergraduate degree in accounting also eligible for this program. Undergraduates students have to complete at least 30 semester hours or equivalent of college work and have to have a GPA of at least 3.3 on a 4.0 scale. Awards are primarily based on merits and academic achievement. For the purposes of this program the AICP defines minority students as those of Black, Native American, Pacific Island races or Hispanic ethnic origin. All applicants must be U.S. citizens. The maximum award amount is $5,000. Deadline is June 1, of each year. Over the past 10 years the AICPA has awarded more than $6 million in scholarships to minority students. You can find this scholarship and all the scholarships we talked about on the Financial Aid Pod cast at our new experimental Scholarship Search Site at www.studentscholarshipsearch.com. This link I actually just added it yesterday when I was cruising around the net. If you are going into Accounting, great way to pay your education; check it out www.studentscholarshipsearch.com. They'll be a link in the show notes to the AICPA Scholarships for Minority Accounting Students. Wow, that construction noise is really annoying. Can you guys hear that? What the heck are they doing over there? I hope actually you can't, I hope that the Logitech noise cancelling microphone does it's job particularly well today.
Let's move on now to our next piece of Pod Safe music, we're going to do, let's see what we have in this selection here. Let's do "In a Long Time" by 46 Bliss. If you like the Annie Lennox vibe, you'll probably like this song it's pretty near the top of the charts for Pod Safe music for the past couple of weeks, so check it out. 46 Bliss, "In a Long Time."
That was 46 Bliss with "In a Long Time" from the Podsafe Music Network. Great piece of Podsafe music there. All right let's touch the mail bag a little bit here and see what we've got. Let's see, there's some spam, there's some more spam. Question from Marie Terese, who asks, I entered into the contest, as I don't have an Ipod, I don't have one and will not have one to listen in on December 1, 2005, what do I do? This is actually something important to Pod casting, not necessarily definishly. Podcasting does not require the use of an Ipod, despite the name; podcasting is basically any MP3 files out there. If you're talking to someone, or if you're working with someone and they are confused about how to tune into podcasting if they don't have an Ipod, well you don't need an Ipod to listen to pod casts. It's nice, but it's by no means essential so that's really important that people understand that you can just listen in with any MP3 player. Winamp, I-tunes, Ipod, we publish a direct link in every show to a download just the raw MP3 file if you want to drag it and drop it onto your particular device, or just listen to it on your computer. That is perfectly fine, so that's important to let people know. If you're confused about what I was talking about there, we have a competition going on right now for--to win a free Ipod basically, and tomorrow of course we're going to be doing the drawing for the Itunes music store cards. But as part of the 100th show celebration we talked about 12 shows ago, we are offering a chance as to win a free Ipod Nano with Linear head phones or a pay your student loans for a month up to $300. You just have to either apply for any loan product from the student loan network, which is Stafford Loans at www.StaffordLoans.com, Parent Plus Loan at www.ParentPlusLoan.com, Act Education Loans at www.ActEducactoinLoans.com, or Student Loan Consolidation at www.StudentConsolidator.com, or Graduate Loans at www.GradLoans.com. Or apply at the no-purchase-necessary route at www.financialaidpodcast.com. You can enter to win this contest, we're going to do the drawing on December 1st, which I believe is a Thursday and give it away and hopefully get it out just in time for Christmas.
So let's see what else we got in the mailbag here. Here's a piece from a Chamilia Stalsy, who asks "I don't know what my school's code is for the FAFSA I've applied in the past but I've never used the funds, where can I find the codes?" Okay, again, part of the news you can use, and part of the FAFSA online as we talked about yesterday. One thing that's a handy feature on www.FAFSAonline.com, if you're looking to fill out your FAFSA and you need your school's FAFSA code, there is a school directory I believe, let's see...its called FAFSA School Info, on the left hand side of the page and you just pick the state that the school is in. For example, let's go to New Hampshire here, and pick Canaan College. And right there you'll find all the information you need to know about the school, including its FAFSA ID number. It's a six digit ID; I believe that is like question 96 on the FAFSA. It's the one where you're selecting your schools. Well actually Canaan College just closed in 1975. By the way that information is also in the directory in case you were wondering. The six digit code is in there, and that is the code that you would use to complete your FAFSA. If actually there is a school in there that the code is wrong, so in fact you can check it, you can double check it by checking the school's mailing address which is also listed in the school directory. Hopefully that will help, help Chamilia get her FAFSA stuff straightened out there.
One more question from a gentleman here who's questioned to not be named, just be called James. He says "I only have a dollar in my checking account, and I have no source of income. How can I pay the FAFSA application fee?" Okay, here's-here's the deal. And I know this is a sticking point with a lot of FAFSA websites out there--it has been empassed for us as well. The FAFSA itself is a free form to file, just like the IRS 1040 is a free form to file. On several of our websites, like www.fafsaapplication.com and in the Get Professional Help page of www.fafsaonline.com you can use a professional FAFSA preparation service. Basically a FAFSA preparer to prepare your FAFSA for you. This is not required at all, its like, you know using H&R Block for your taxes-not required at all. You can file your taxes by yourself, it's perfectly fine, and you can do the same thing with your FAFSA as well. The services are offered basically as a means for helping people who either don't want to take the time to do a lot of the leg work when it comes to doing your FAFSA stuff, or you're really, really afraid of making some hideous mistakes in filing your FAFSA. Which you know, can happen, especially if like we were talking about yesterday with the re-launch of FAFSA online. If you look at the draft FAFSA for 2006-2007, there are errors in the directions, when it refers to lines in the IRS 1040. So certainly there is a value to the FAFSA preparation services.
I would not say that there is not, because we offer them through the student loan network. That said, you do not need to pay for the FAFSA. Just ...flat out, you do not need to pay for the FAFSA. The only form, financial aid form that I know of that you must pay for is the CSS Profile which is offered by the College Board, you know, a fair number of schools use for determining your non-federal financial aid for state aid, for institutional aid, for scholarships and things like that. The CSS profile is $18 per school, plus a $5 application fee. That one is basically offered through a private agency which is why there is money being charged for it. If you're going to a school that requires it, then yeah you're going to have to come up with the money. The twenty three, at the very least the $23 for the one school. You can add additional schools for $18 each. I would definitely check with the school's financial aid office or your perspective school's financial aid office before you pay the money to make sure they require it. Because if it's just going to be for scholarships you might be better off applying for free for scholarships that the school doesn't offer that are external scholarships. You get the money from them, and you don't have to, to pony up the money for the CSS profile, but check with your school about that. Alright, that's the mailbag today, let's finish off today's show with one more piece of Podsafe music. I think I want to do, "Bring the Guitar" by Alice Marie.
"Bring the Guitar," by Alice Marie from the Podsafe Music Network. Alright folks, that is going to tie it up for today's show, we covered a lot of ground today, and hopefully we will do the same tomorrow as well. Remember, tomorrow we are doing the Itunes music store $15 gift card give-away. So if you want to be entered in at the very last second, check out the November newsletter of the Financial Aid News at www.financialaidnews.com. There is a brief three question survey we ask you to fill out, basically trying to find out more information where people get their sources of financial aid income. Or sources of money for financial aid for paying for college. So fill out the survey, and you'll be entered to win. We'll be doing a drawing of five cards tomorrow and of course, remember, the Ipod Nano contest is also at www.financialaidpodcast.com. You can enter to win there. Show Notes: same website, www.financialaidpodcast.com. Any questions or comments or feedback or commentary, or if you like the old format, the new format, confused about the FAFSA, email me! Financialaidpodcast@gmail.com. I'll be more than happy to take a look at what you have to say, and possibly cover it on the show. So stay tuned, stay subscribed, if you're not subscribed, get subscribed, its really, really easy, and you'll never miss a show. Financialaidpodcast.com has all the details but it basically works out to download the new Itunes, install the new itunes, and click on the ad to My Itunes link on the website. So, until tomorrow, take care folks. We're off to see First Marblehead the lending institution today. Bye bye.