“Wicked Hard” Financial Leveraging for Middle Income Families Rakin Hall, M.Ed University of Southern California.

“Wicked Hard”Financial Leveraging for Middle Income Families

Rakin Hall, M.EdUniversity of Southern California

The Evolution of Degree AttainmentWhy be so smart?

Paper ChaseA brief history of wealth acquisition.• Conquering

• Land acquisition• Slavery

• Free labor• Industrial revolution

• Wealth creation• Information age

• Exchange of knowledge/technology

AltruismBuilding a university

Keepers of the gateCollege was never intended for mass consumption.• The three pillars of building a university

• Qualify/Quantify/Diversify• Scholarship money

• Qualify• Student Migration

• Quantify/Diversify

Paper ChaseA brief history of wealth acquisition.

• Conquering• Acquiring lands

• Slavery• Free labor

• Industrial revolution• Wealth creation

• Information age• Exchange of knowledge/technology

What’s the disconnect?Mean v. Standard Deviation

CSS Profile

Who does this benefitThe rich, the poor, the middle class, or the colleges?

• $25 to complete profile• Current year’s (2012) federal income tax return(s), if

completed• Prior year’s (2011) federal income tax return(s)• W-2 forms and other records of money earned in 2012• Records of untaxed income and benefits for 2011 and 2012• Current bank statements• Current mortgage information• Records of savings, stocks, bonds, trusts, and other

investments

Why Are We Here?What’s the cost?

• $902 billion and $1 trillion in total outstanding student loan debt in the United States. (Source: American Student Assistance)

• Nearly 20 million attend college each year. (Source: Chronicle of Higher Education) Americans

• Of that 20 million, close to 12 million – or 60% - borrow annually to help cover costs. (Source: Chronicle of Higher Education)

• There are approximately 37 million student loan borrowers with outstanding student loans today. (Source: Federal Reserve Board of New York)

Options?What Can Middle Income Families Do?

Tactics• Savings

• Generational v. Liquid Wealth• Home Equity

• Housing bubble burst• Loans/Parent Plus Loans

• Zombie debt• Income Based Repayment (IBR)

• 10% of income• Loan forgiveness

“Wicked Hard”Financial Leveraging for Middle Income Families

Rakin Hall, M.EdUniversity of Southern California