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Great lessons from great women

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A decade ago, J.D. shared some great lessons from great men. He had a wealth of material to draw from: biographies of historical figures from centuries ago, classic business texts, and the earliest self-help books.

If you want to compile lessons from great women, however, you don’t have the same sources, because women have not been considered “great” for much of history, and thus they’ve not been asked for their opinions on most things — certainly not financial matters! Multiply that times ten for women of color.

Today, I’d like to share some great lessons from great women. But the wisdom I’ve collected here comes primarily from media sources and speeches. It’s no less wise than the wisdom from books written by great men, and it applies to everyone of all genders, although it’s informed in many cases by much tougher life circumstances than the white men who lent their thoughts to this post’s counterpart.

Here are ten inspiring bits of wisdom that I’ve learned from great women.

Do the Work

“There are two kinds of people, those who do the work and those who take the credit. Try to be in the first group; there is less competition there.”Indira Gandhi, India’s first (and only) female prime minister

We are trained to look for shortcuts in everything. More than that, we’re surrounded by people who want the glory and the money associated with having done something without actually doing the thing.

But real success – and with it a sense of true accomplishment and fulfillment – only comes if we actually do the work. Success without having done the work feels hollow. And the belief that success should come instantly and with glory puts us in the wrong mindset to achieve big things.

I’d tweak Indira’s quote just a little, though, to say that it’s fine to claim credit – in fact you should! – but only after you’ve actually done the work.

Work first, credit second.

Define Success for Yourself

“To me success means effectiveness in the world, that I am able to carry my ideas and values into the world — that I am able to change it in positive ways.”Maxine Hong Kingston, author

Our society tends to have a one-dimensional definition of success: To be successful is to have power, status, and money. While those things might satisfy some of us, it’s simply not true that everyone will feel equally fulfilled by having them, never mind that our current economy simply won’t allow most people to achieve those things.

Instead, let’s follow Maxine’s advice and define success for ourselves. She defines it as effectiveness at carrying her ideas and values into the world, which is true for me, too, but you get to choose your own definition.

Mistakes Aren’t Failure

“You know, failure hurts. Any kind of failure stings. If you live in the sting, you will undoubtedly fail. My way of getting past the sting is to say no, ‘I’m just not going to let this get me down.’”Sonia Sotomayor, the first Latina justice on the U.S. Supreme Court

“Failure is an important part of your growth and developing resilience. Don’t be afraid to fail.” – Michelle Obama

It’s natural to be afraid of failure. And despite the recent Silicon Valley-led trend of “failing fast” (in which failure is accepted but is also supposedly painless), Sonia and Michelle understand that failure sucks. There’s no point in sugar-coating it.

If you invest yourself in something and it doesn’t work out, it’s inevitable that that’s going to hurt. But what matters is what you do next. Do you wallow in that hurt? Or do you figure out what you can learn from that failure, and refuse to let it stop you?

Be like these great women and carry on, more resilient than ever.

Embrace Fear

“If your dreams do not scare you, they are not big enough.”Ellen Johnson Sirleaf, President of Liberia and Nobel Peace Prize winner

Speaking of that fear of failure, not only can we not let failure stop of from moving forward, we can’t let the fear of it stop us from even trying in the first place.

Fear can be a helpful guide to tell us that we’re getting closer to our highest purpose, and to doing something that really matters. If you’re never scared by something you’re setting out to accomplish, it doesn’t mean that you’re especially brave. It means you’ve never challenged yourself.

Real Wealth Is Community

“My object in life is not simply to make money for myself.”Madam C. J. Walker, the first self-made African-American millionaire

We don’t talk enough about the incredible life of Madam C.J. Walker, an entrepreneur who was determined to build her own wealth, but also to lift as she climbed and enrich others in her community along the way. Fortunately, you can now learn more about her in the Netflix series Self Made.

Walker grew up in terrible poverty, like most African-Americans of her day, and knew she wouldn’t be satisfied if she only enriched herself without making things better for her community. It’s a lesson we can all take to heart, asking how we can use our own opportunities and advantages to create opportunities for others, especially for those who’ve historically faced more barriers.

Generosity and an Abundance Mindset Will Serve You Well

“If you look at what you have in life, you’ll always have more. If you look at what you don’t have in life, you’ll never have enough.”Oprah Winfrey

“No one has ever become poor by giving.”Anne Frank

Something I wish I’d understood earlier in life is the destructive power of a scarcity mindset (in which you focus on what you don’t have and feel compelled to hoard money) rather than an abundance mindset (in which you focus on what you do have and therefore don’t need to hold on to it so tightly).

Psychological research tells us that giving of ourselves, both our time and money, makes us feel better about ourselves, more grateful for what we have, and happier overall. And that’s in addition to strengthening our communities and helping those less fortunate at the same time.

Generosity is a muscle you have to build, so start small if you have to, but give whenever you can.

Pursue the Things You Love Most

“You can only become truly accomplished at something you love. Don’t make money your goal. Instead, pursue the things you love doing, and then do them so well that people can’t take their eyes off you.”Maya Angelou, author, poet, and civil rights activist

I actually kind of hate the “follow your passion” career advice that so many extol, because it’s simply not universally applicable, and it sets up an unhelpful divide between those who are able to go into a career path about which they’re passionate, and those who have to do the thankless jobs that we’re finally recognizing as essential in the era of COVID-19.

But your career is not the entirety of your existence. And in your life as a whole, I absolutely believe in letting what you love guide you, without regard for money.

Being accomplished at something doesn’t have to mean getting a paycheck to do it, nor does it require public recognition. It could be something you do privately for your own enjoyment and nothing else. And doing it without regard for money is an important piece, because we make decisions differently when we’re profit-motivated.

Allow yourself at least one thing you love in life in which money plays no part.

Claim Your Power

“Power is not given to you. You have to take it.”Beyoncé

“We teach girls to shrink themselves, to make themselves smaller. We say to girls: You can have ambition, but not too much. You should aim to be successful but not too successful, otherwise you will threaten the man. If you are the breadwinner in your relationship with a man, pretend that you are not, especially in public, otherwise you will emasculate him.”Chimamanda Ngozi, author and activist

“We as women should shine light on our accomplishments and not feel egotistical when we do. It’s a way to let the world know that we as women can accomplish great things!”Dolores Huerta, founder of the United Farm Workers

“Women’s empowerment” is another idea I kind of hate, because it suggests we are being granted some small amount of power by those who already possess it, in the amounts they choose to grant.

But those in power never asked permission or waited patiently to be gifted what they felt was theirs. They didn’t shrink themselves to make others feel better about themselves. They didn’t hesitate to shout their accomplishments because of how it might make them look. They took that power and stood in it — without shame.

So, instead of “being empowered”, we should claim our own power. (And to those who’ve historically had those advantages, don’t worry – “power” isn’t a zero-sum game. More people having power doesn’t lessen your own.)

Use your voice, cheer your accomplishments, and live to your full potential.

People Are More Important Than Anything

“People first, then money, then things.”Suze Orman

“Remember, ‘No one’s more important than people’! In other words, friendship is the most important thing—not career or housework, or one’s fatigue—and it needs to be tended and nurtured.”Julia Child

We can argue about whether Suze Orman is a great woman or not, but she certainly expressed this sentiment most succinctly: People are the most important thing.

If your wealth or your success comes at the expense of your relationships, then all the money in the world won’t make you happy. And countless studies confirm this: Those with the strongest relationships live the longest and have the most high-quality-of-life years, they have the greatest sense of purpose, and they’re the happiest.

Put the people in your life first, ahead of your career and hustle, if you care about what your life adds up to and not just what your financial numbers add up to.

Know What You Stand For

“Stand for something or you will fall for anything. Today’s mighty oak is yesterday’s nut that held its ground.”Rosa Parks, American civil rights activist

This may seem like it’s not a money lesson, but it absolutely is. We’re faced with scores of choices every day that have real-world implications for other people and the planet.

Let’s say you decide you want to earn passive income through rental real estate. Do you want to be a slum lord who does the bare minimum maintenance on your properties and evicts people the second rent is late? Or do you want to recognize that your property is someone’s home and maintain it accordingly, and cut them some slack if they have trouble paying?

Making no decision is a decision in itself, so make your choice consciously. Know what you stand for, and recognize that your money is the single biggest expression of your values.

Final thoughts: The women who gave us these lessons are a huge inspiration to me, and their fights for justice have paved the way for future generations to struggle less. Let’s carry their lessons into the world and do great things!



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Finance

Here’s Your Plan to Retire in Ten Years

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The average American has only a little over $200,000 saved for retirement by age 65. It’s a small wonder that 50% of married couples and 70% of individuals receive 50% or more of their retirement income from Social Security.

But that doesn’t have to be you. In fact, you don’t even need to wait until you’re 65 to retire. It’s possible you can retire in 10 years – as in 10 years from where you are right now. It doesn’t matter if you’re 25, 35, or 45, with the right mix of discipline, commitment, and financial strategies, it’s a goal you can reach.

Many thousands of others have already done it, which means you can too. And you can do it even if you have no money saved for retirement right now.

Here’s how…

But first, let’s touch on a few important concepts.

Determine “Your Numbers”

What are your numbers? The amount of income you’ll need each year to live in retirement, and the amount of money you’ll need in your portfolio to produce that income.

Let’s say you decide you’ll need $40,000 per year to live in retirement. It’s possible to determine the amount you’ll need to have saved to provide that income.

It’s known loosely as the safe withdrawal rate. It’s a theory mostly, but one that’s been shown to be reliable in a number of studies.

It holds that if you withdraw it no more than 4% from your investment portfolio each year, you’ll have an income for life, and your portfolio will remain intact.

It works something like this: if you earn an average of 7% on your portfolio in retirement, and withdraw 4% for living expenses, that will leave 3% in the portfolio to cover inflation.

If we look at the rate of inflation going back to 1990, it ranged between 1.1% to 5.3% per year, with an average of something less than 3%. Over the past 20 years the average has been closer to 2%. But since early retirement will bring long-term planning consequences, let’s go with 3% as an average.

Can You Earn an Average of 7% Annually for the Rest of Your Life?

Investing is all about playing the long-term averages, and that’s what works in your favor.

Here’s how:

The average return in stocks has been about 10% per year going all the way back to 1928. It varies quite a bit from one year to the next, but that’s the return you can expect over 20 or 30 years.

Meanwhile, safe investments, like high-yield online savings accounts, are currently paying between 1% and 2% per year. But to be conservative, let’s go with 1.5% for our calculations.

If you create an investment portfolio comprising 65% stocks and 35% in high-yield online savings, you can achieve a 7% average annual return.

Here’s how it breaks down:

65% invested in stocks at 10% per year will generate a 6.5 % return.
35% invested in high yield online savings at 1.5% per year will generate a 0.525 return.

The combination of the two will produce an average annual return of 7.025%. That will allow you to withdraw 4% each year for living expenses and retain the remaining roughly 3% in your portfolio to cover inflation.

Why have only 65% in stocks when a higher allocation will get you a bigger return?

If you’re planning to rely on your investments for the rest of your life, you’ll need to build some safety into your portfolio. A 35% allocation in safe assets means that even if the stock market takes a big hit, your portfolio won’t go down with it.

Another important point on this front is that though interest rates are low by historical standards right now, that situation could change. If interest rates were to return to 5%, the savings allocation would make a much bigger contribution to your annual returns, and do it risk-free.

Back to “Your Numbers”

Now that you can see how the 4% safe withdrawal rate works mechanically, it’s time to determine your portfolio number.

If you need $40,000 in income, you can determine your portfolio size by multiplying that number by 25. Why 25? If you really like math, you can divide $40,000 by 4%, and you’ll get $1 million.

But for those of us who don’t like mathematical formulas and number-crunching, it’s easier to simply multiply your income number by 25 to get your portfolio size.

If you multiply $40,000 by 25, you’ll get $1 million. It’s just a simpler calculation, and it’ll get you to the portfolio amount you need quickly.

Commit to Your Numbers

I’ve used $40,000 as an income number for retirement, but it’ll be different for everyone. For example, if you have other income sources you expect to continue in retirement you may need less. But if you want a little bit more fun and luxury in your life, you’ll probably need more.

I’ve only used this number as an example. You can come up with an income number that will work for you. As you can see from my calculations above, your portfolio number will be determined by your income number.

You’ll need to know both.

For example, if you think you’ll need $50,000, you’ll need to build a portfolio of $1.25 million ($50,000 X 25). If you’ll need $100,000 in income, your portfolio will need to reach $2.5 million ($100,000 X 25).

To reach your goal, you’ll need to work toward three objectives:

  1. Saving the money needed to build your portfolio.
  2. Earning a return on your investments that will not only help you build your portfolio, but also keep it growing once you retire.
  3. Implement spending reductions and controls that will enable you to live on what will probably be less money than you are right now.

If you plan to retire in 10 years, you’ll need to commit to all three. Your retirement income and portfolio numbers must serve as a guiding light from now on. As you can easily imagine, retiring in 10 years is a tall order. You won’t get there by taking shortcuts. You’ll need to achieve all three objectives to reach your goal. That’ll take a 100% commitment but it’s the only way to make it happen.

Now let’s look at creating a timetable.

Year 1: Set the Plan to Start Saving

The average person probably saves between 10% and 15% of their pay toward retirement. But if you hope to retire in 10 years, you’ll need to save a lot more. Like 30%, 40%, 50%, or even more.

That’s going to take more than a little bit of sacrifice, and it may not happen right away. That’s why you may need to commit the better part of the first year to getting this phase in full working order.

The best way to start is by implementing a budget immediately. If you’ve never done that in the past, you may need to get help. You can do that by selecting a budgeting application that will show you how.

Your budget should include a generous allocation toward savings. It’s possible that at the beginning of the year you’ll only be able to commit to 15% or 20%. Don’t be discouraged – that’s an excellent start if you’ve never been a saver in the past.

But as you move forward, you’ll need to increase the percentage. For example, you might start by saving 20% of your income. But you can double that percentage by increasing it by 2% each month for 10 months. That will get you to 40%, which may work for you.

If it won’t, commit to continued, gradual increases in savings, even if you have to move them into Year 2.

You should know that anyone who’s committed to a high savings level has found that it gets easier over time. That’s why it’s so important to start in the first year.

Year 2: Focus on Increasing Your Income

There are two ways you can do this: increase your job income or create additional sources of income.

Let’s look at the benefit of each.

  1. Increase your job income. Early retirement shouldn’t mean abandoning your career plans. By continuing to move forward on your job, higher income should follow. That will provide the extra funds to save even more money. But there’s a second purpose for building up your career. If for any reason you may need to rely on a source of earned income when you retire, returning to your current career can be the easiest and most profitable way to make it happen. Most likely, you’ll be able to work in some reduced capacity, like part-time, remote work, contract, or freelancing within your industry, or even with your current employer. Continuing to increase your income on your job will also help if you find it will take longer than 10 years to reach your retirement goal.
  2. Create additional sources of income. What I’m talking about here is creating a side hustle to go along with your full time job. Not only will this generate an additional income while you’re preparing for retirement, but it can also provide a valuable postretirement income source. That would keep you from needing to go back to your current career to earn additional income. One of the best ways to create a side hustle is by making money online. It will not only enable you to make money no matter where you choose to live after retirement, but it holds the potential to make a lot of money. I’ve managed to create seven different income sources using this method. You can do something similar. Begin building a side hustle in Year 2, and you’ll have plenty of extra income when retirement arrives.

Year 3: Focus on Increasing ROI on your Savings

By Year 3 you should be committing to learning all you can about investing. The more you know, the higher your investment returns will be. It will not only enable you to build your retirement portfolio faster, but it can also provide higher returns when you finally retire.

There are ways you can increase your returns, largely by moving into different investment platforms.

For example, if you want to dramatically increase your fixed-income earnings, investing at least some of your bond portfolio in Lending Club can increase your interest income dramatically. Many investors are reporting returns of 7% to 10% per year.

You may also want to allocate part of your stock portfolio toward some type of real estate investing. That will not only provide high returns, but it will also diversify your portfolio in years when stocks are not performing well. Real estate crowdfunding platforms, like Fundrise can provide returns similar to stocks, and sometimes higher. Check out the many different ways you can invest in real estate to improve your return on investment.

If you’re not having much luck with investing, or you don’t have a serious commitment to it, look into investing through a robo-advisor. Those are automated, online investment platforms that provide full portfolio management for a very low fee. That includes building your portfolio, rebalancing it as necessary, reinvesting dividends, and even minimizing your investment-related taxes.

A robo-advisor like Betterment can manage your portfolio for 0.25% per year. That’s $250 for a $100,000 portfolio, or $2,500 for a $1 million portfolio. But if you’d like investing with a more personal touch, you may want to consider Personal Capital. They charge a higher fee, at 0.89%, but also provide financial planning advice, as well as regular access to live investment advisors.

Year 4: Focus on Reducing Your Spending

Cutting your spending is a strategy that needs to be implemented in Year 1. But those reductions will need to become progressive as each year goes by. And it’ll be even more important as your income grows, since there’s always a temptation to spend more as you earn more. That process even has a name – lifestyle inflation. You’ll need to avoid it.

The purpose of reducing spending is twofold:

  1. to free up more money for savings
  2. to lower your cost of living in anticipation of retirement.

Both are equally important. But the second part may be even more so. That’s because early retirement almost certainly requires you to change lifelong spending patterns.

For example, if you’ve been used to living in a large home, driving a late model car, and taking expensive vacations, it may take you several years to unwind those patterns. Put another way, you’ll need to find less expensive ways to create an enjoyable life. And you’ll need to have that well underway before you finally retire. Unfortunately, retirement and an opulent lifestyle are incompatible.

Focus on ways you can reduce your spending. You’ve probably already guessed that involves a lot more than clipping coupons and cutting your cable TV subscription. And in fact, it may require either cutting some very large expenses – like your housing and transportation – or reducing or eliminating dozens of smaller expenses.

There will be tough choices to be made. After all, cutting spending is something like going on a money diet. You’ll do well to think about your ultimate objective – early retirement – to help you embrace the short-term sacrifice.

Ultimately, retirement is about lowering your living expenses to a point where you can live comfortably without working. You may need to remind yourself of that on a regular basis.

Year 5 – 10: Assess and Plan Your Path to Retirement

At this point, you’re moving into the second half of your decade-long early retirement preparation. Generally speaking, you’ll want to concentrate mainly on staying the course. But at the same time, you’ll want to look for ways to increase savings, income and return on investment, and reduce spending.

You may not need to do anything dramatic in those areas at this point. But you should be alert to any ideas or strategies that can improve your performance in each. Small improvements in multiple strategies can dramatically speed your progress. That should be your goal at this point.

But perhaps most important will be guarding against complacency. By now, your overall financial situation will have already improved substantially. This is not the time to take a break. Keep pressing forward until you reach the point where you can finally retire.

Final Thoughts

Why am I stressing the importance of commitment to your early retirement goal? It’s easier than you think to get distracted, especially when you’re making a major change in your life. But while early retirement is certainly possible, it’s not easy. You’ll need to maintain laser beam focus to reach the goal in 10 years.

It will help you to realize the many options that will be open to you once your early retirement goal. Free from needing to make a living, you’ll have the choice to spend your time enjoying your life more, or pursuing opportunities that may even have the potential to make you wealthy.

It’s the kind of thing that happens once financial stress is gone from your life. But before you reach that point, you’ll need to be fully committed to getting there. 

The post Here’s Your Plan to Retire in Ten Years appeared first on Good Financial Cents®.



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MEFA Student Loans Review: Non-Profit Lender With Low Rates And Fees

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MEFA Student LoansMEFA Student Loans

When you need a private student loan for school, finding a student loan provider who can meet your needs and has reasonable loan terms is critical.

Private student loan providers are not all created equal. So researching providers is a must when it comes to finding a good deal. Looking for lenders that are non-profit organizations can be a good starting point as they may be willing to offer more attractive rates and/or terms.

MEFA is one such non-profit provider. For undergraduate and graduate students who are United States citizens and attend an eligible college, MEFA student loans could be a strong option. We’ll explain the loan features and when a private student loan from MEFA could make sense.

See how MEFA compares to other private lenders in minutes on Credible!


MEFA logoMEFA logoMEFA logo

Quick Summary

  • Undergraduate and graduate student loans
  • Reasonable rates and terms
  • No formal forbearance policy

MEFA Student Loans Details

Product Name

MEFA Student Loans

Min Loan Amount

$1,500

Max Loan Amount

Cost of Attendance

APR

3.75%-5.75%

Rate Type

Fixed

Loan Terms

10 or 15 Years

Promotions

None

Who Is MEFA?

MEFA is the Massachusetts Educational Financing Authority. They are a non-profit organization based in Boston, MA. MEFA provides student loans for undergraduate and graduate students alike. MEFA was created in 1982 by the Massachusetts state legislature at the request of colleges and universities across the state.

What Do They Offer?

MEFA offers private student loans to undergraduate and graduate students. They also provide student loan refinancing. While MEFA is a Massachusetts-based organization, they lend to families in all 50 states.

A MEFA loan only covers one school year. Students must apply each year that they will be in school. For example, if you want a loan to cover four years of school, you’ll need to apply four times for four loans.

Students can borrow up to the cost of attendance minus any financial aid. Minimum loan amounts are $2,000 for private schools and $1,500 for public schools. Cosigners are generally required for undergraduate loans.

Qualifications

Students must be enrolled at least half time in an accredited degree-granting undergraduate or graduate program and maintain satisfactory academic progress as outlined by the school. The school must be a non-profit but can be public or private. Loan applications are subject to MEFA credit approval standards.

To find out your actual loan rates, you’ll have to go through the full application process, which does require a hard credit check. If you are using a cosigner, they will also require a credit check and the final loan amount can depend on the cosigner’s finances. Upon approval, any loan rate that you might receive will fall within the ranges stated below for undergraduate and graduate loans.

Undergraduate Loans

There are several types of student loans for undergraduates to choose from. Fixed rates vary from 3.75% to 5.75% APR. Note: rates subject to change.

  • Immediate Repayment (10-year term): Payments begin immediately (28th day of the month following the final disbursement). 3.75% – 5.30% APR
  • Immediate Repayment (15-year term): Payments begin the same as above. 3.95% – 5.35% APR.
  • Interest-Only Repayment (15-year term): Interest-only payments begin immediately. Payments that include principal begin after the undergraduate anticipated in-school period. 4.25% – 5.40% APR.
  • Deferred Repayment (15-year term): Payments are deferred until six months after the student graduates or no longer meet academic qualifications. Deferments are available for a maximum of 60 months. 4.38% – 5.50% APR. 
  • Student Deferred Repayment with Co-Borrower Release (15-year term): Same terms as “Deferred Repayment.” However, the co-borrower can be released after 48 consecutive on-time payments. 4.62% – 5.75% APR.

Graduate Loans

There are two types of graduate student loans available from MEFA. Both have fixed rates. The same loan minimum and maximum amounts apply for graduate as undergraduate loans.

  • Interest-Only Repayment (15-year term): Payments begin the 28th day following the final loan disbursement. The principal will be added to loan payments once the in-school period ends. 4.25% – 5.40% APR.
  • Deferred Repayment (15-year term): Payments are deferred until six months after the student graduates or no longer meet academic qualifications. Unlike undergraduate loans, deferments on graduate loans max out at 36 months. 4.45% – 5.50% APR.

Are There Any Fees?

MEFA student loans (for both undergrads and graduates) come with no application or origination fees. They also don’t charge fees for late payments or returned checks. Finally, there are no prepayment penalties on MEFA student loans.

How Do I Open An Account?

To apply for a MEFA loan, visit https://www.mefa.org. Keep in mind that MEFA doesn’t offer pre-qualified rate quotes. If you submit a loan application, a hard credit inquiry will be placed on your credit report.

Is My Money Safe?

Since MEFA doesn’t take deposits, there isn’t any money to lose. If you’re approved for a MEFA student loan, the funds will be disbursed directly to your college or university.

Is It Worth It?

For students who need to take out private student loans to help pay for school, MEFA student loans could be worth it. They have competitive rates and terms and do offer some in-school deferment options.

However, one major downside to MEFA is that they don’t have any formal hardship forbearance policy. And since they use traditional loan underwriting methods, it’s likely that you’ll need a cosigner to get approved for a MEFA undergraduate student loan (and only one of their loans offers cosigner release).

Before you apply for any MEFA student loans, be sure to compare them with other private lenders on Credible. And if you’re looking to take out a private student loan without a cosigner, check out our guide.

MEFA Student Loans Features

Min Loan Amount

  • Public school: $1,500
  • Private school: $2,000

Max Loan Amount

Cost of attendance

APR

3.75%-5.75%

Auto-Pay Discount

None

Rate Type

Fixed

Loan Terms

10 or 15 years

Origination Fees

None

Prepayment Penalty?

No

In-School Payments

  • Immediate payments
  • Interest-only payments
  • Full deferment

Co-signers Allowed?

Yes, but only on one undergraduate plan

Grace Period

6 Months

Eligible Schools

Accredited non-profit degree-granting undergraduate or graduate program (public or private)

Servicer

American Education Services

Customer Service Phone Number

1-800-266-0243

Customer Service Hours

Monday-Friday, 8 am – 8pm

Customer Service Email

mefaloans@mefa.org

Address For Sending Payments

American Education Services
P.O. Box 65093
Baltimore, MD 21264-5093

Promotions

None

The post MEFA Student Loans Review: Non-Profit Lender With Low Rates And Fees appeared first on The College Investor.



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Introducing Coverage Critic: Time to Kill the $80 Mobile Phone Bill Forever

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A Quick Foreword: Although the world is still in Pandemic mode, we are shifting gears back to personal finance mode here at MMM. Partly because we could all use a distraction right now, and even more important because forced time off like this is the ideal time to re-invest in optimizing parts of your life such as your fitness, food and finances.

Canadian Readers – we have also collected some recommendations for you at a new Canadian Mobile Phone recommendations page.

Every now and then, I learn to my horror that some people are still paying preposterous amounts for mobile phone service, so I write another article about it.

If we are lucky, a solid number of people make the switch and enjoy increased prosperity, but everyone who didn’t happen to read that article goes on paying and paying, and I see it in the case studies that people email me when looking for advice. Lines like this in their budget:

  • mobile phone service (2 people): $160

“NO!!!!”
is all I can say, when I see such unnecessary expenditure. These days, a great nationwide phone service plan costs between and $10-40 per month, depending on how many frills you need.

Why is this a big deal? Just because of this simple fact:

  • Cutting $100 per month from your budget becomes a $17,000 boost to your wealth every ten years.

And today’s $10-40 phone plans are just great. Anything more than that is just a plain old ripoff, end of story. Just as any phone more expensive than $200* (yes, that includes all new iPhones), is probably a waste of money too.

So today, we are going to take the next step: assigning a permanent inner-circle Mustachian expert to monitor the ever-improving cell phone market, and dispense the latest advice as appropriate. And I happen to know just the guy:

Christian Smith, along with colleagues at GiveWell in San Francisco, circa 2016

My first contact with Chris was in 2016 when he was working with GiveWell, a super-efficient charitable organization that often tops the list for people looking to maximize the impact of their giving.

But much to my surprise, he showed up in my own HQ coworking space in 2018, and I noticed he was a bit of a mobile phone research addict. He had started an intriguing website called Coverage Critic, and started methodically reviewing every phone plan (and even many handsets) he could get his hands on, and I liked the thorough and open way in which he did it.

This was ideal for me, because frankly I don’t have time to keep pace with ongoing changes in the marketplace. I may be an expert on construction and energy consumption, but I defer to my friend Ben when I have questions about fixing cars, Brandon when I need advice on credit cards, HQ member Dr. D for insider perspectives on the life of a doctor and the medical industry, and now Chris can take on the mobile phone world.

So we decided to team up: Chris will maintain his own list of the best cheap mobile phone plans on a new Coverage Critic page here on MMM. He gets the benefit of more people enjoying his work, and I get the benefit of more useful information on my site. And if it goes well, it will generate savings for you and eventual referral income for us (more on that at the bottom of this article).

So to complete this introduction, I will hand the keyboard over to the man himself.

Meet The Coverage Critic

Chris, engaged in some recent Coverage Criticicism at MMM-HQ

I started my professional life working on cost-effectiveness models for the charity evaluator GiveWell. (The organization is awesome; see MMM’s earlier post.) When I was ready for a career change, I figured I’d like to combine my analytical nature with my knack for cutting through bullshit. That quickly led me to the cell phone industry.

So about a year ago, I created a site called Coverage Critic in the hopes of meeting a need that was being overlooked: detailed mobile phone service reviews, without the common problem of bias due to undisclosed financial arrangements between the phone company and the reviewer.

What’s the Problem with the Cell Phone Industry?

Somehow, every mobile phone network in the U.S. claims to offer the best service. And each network can back up its claims by referencing third-party evaluations. 

How is that possible? Bad financial incentives.

Each network wants to claim it is great. Network operators are willing to pay to license reviewers’ “awards”. Consequently, money-hungry reviewers give awards to undeserving, mediocre networks.

On top of this, many phone companies have whipped up combinations of confusing plans, convoluted prices, and misleading claims. Just a few examples:

  • Coverage maps continue to be wildly inaccurate.
  • Many carriers offer “unlimited” plans that have limits.
  • All of the major U.S. network operators are overhyping next-generation, 5G technologies. AT&T has even started tricking its subscribers by renaming some of its 4G service “5GE.”

However, with enough research and shoveling, I believe it becomes clear which phone companies and plans offer the best bang for the buck.  So going forward, MMM and I will be collaborating to share recommended phone plans right here on his website, and adding an automated plan finder tool soon afterwards. I think you’ll find that there are a lot of great, budget-friendly options on the market.

A Few Quick Examples:

Mint Mobile: unlimited minutes, unlimited texts, and 8GB of data for as low as $20 per month (runs over T-Mobile’s network).

T-Mobile Connect: unlimited minutes and texts with 2GB of data for $15 per month.

Xfinity Mobile: 5 lines with unlimited minutes, unlimited texts, and 10GB of shared data over Verizon’s network for about $12 per line each month (heads up: only Xfinity Internet customers are eligible, and the bring-your-own-device program is somewhat restrictive).

Cricket Wireless: 4 lines in a combined family plan with unlimited calling, unlimited texting, and unlimited data for as low as $100 per month (runs on AT&T’s network).

Ting: Limited use family plans for under $15 per line each month.

[MMM note – even as a frequent traveler, serious techie and a “professional blogger”, I rarely use more than 1GB each month on my own Google Fi plan ($20 base cost plus data, then $15 for each additional family member). So some of these are indeed generous plans]

Okay, What About Phones?

With the above carriers, you may be able to bring your existing phone. But if you need a new one, there are some damn good, low-cost options these days. The Moto G7 Play is only $130 and offers outstanding performance despite the low price point. I use it as my personal phone and love it.

If you really want something fancy, consider the Google Pixel 3a or the recently released, second-generation iPhone SE. Both of these are amazing phones and about half as expensive as an iPhone 11.

——————————————-

Mobile Phone Service 101

If you’re looking to save on cell phone service, it’s helpful to have a basic understanding of the industry. For the sake of brevity, I’m going to skip over a lot of nuances in the rest of this post. If you’re a nerd like me and want more technical details, check out my longer, drier article that goes into more depth.

The Wireless Market

There are only four nationwide networks in the U.S. (soon to be three thanks to a merger between T-Mobile and Sprint). They vary in the extent of their coverage:

  • Verizon (most coverage)
  • AT&T (2nd best coverage)
  • T-Mobile (3rd best coverage)
  • Sprint (worst coverage)

Not everyone needs the most coverage. All four nationwide networks typically offer solid coverage in densely populated areas. Coverage should be a bigger concern for people who regularly find themselves deep in the mountains or cornfields.

While there are only four nationwide networks, there are dozens of carriers offering cell phone service to consumers – offering vastly different pricing and customer service experiences.

Expensive services running over a given network will tend to offer better customer service, more roaming coverage, and better priority during periods of congestion than low-cost carriers using the same network. That said, many people won’t even notice a difference between low-cost and high-cost carriers using the same network.

For most people, the easiest way to figure out whether a low-cost carrier will provide a good experience is to just try one. You can typically sign up for these services without a long-term commitment. If you have a good initial experience with a budget-friendly carrier, you can stick with it and save substantially month after month.

With a good carrier, a budget-friendly phone, and a bit of effort to limit data use, most people can have a great cellular experience while saving a bunch of money.

MMM’s Conclusion

From now on, you can check in on the Coverage Critic’s recommendations at mrmoneymustache.com/coveragecritic, and he will also be issuing occasional clever or wry commentary on Twitter at @Coverage_Critic.

Thanks for joining the team, Chris!

*okay, special exception if you use it for work in video or photography. I paid $299 a year ago for my stupendously fancy Google Pixel 3a phone.. but only because I run this blog and the extra spending is justified by the better camera.

The Full Disclosure: whenever possible, we have signed this blog up for referral programs with any recommended companies that offer them, so we may receive a commission if you sign up for a plan using our research. We aim to avoid letting income (or lack thereof) affect our recommendations, but we still want to be upfront about everything so you can judge for yourself. Specific details about these referral programs is shared on the CC transparency page. MMM explains more about how he handles affiliate arrangements here.



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