We hold nearly two-thirds of all student loan debt in the United States. To bring it closer to home, the average graduate walked off campus with around $39,400 last year, which is up 6% from 2016. It’s trending up, so what can we do for ourselves and our loved ones to lower the cost? One (big) option: 529 college savings plans.

We have Abby Chao, co-founder and COO of CollegeBacker, to talk us through what they are, how they work and how you can easily get your loved ones on board.

In Mailbag, we answer your questions on retirement planning for when you’re out of work, credit cards for new adults and how to go from joint accounts to yours, mine and ours. In Thrive, HerMoney reporter Kathryn shares her coverage on the increase in workplace demotions. We discuss what to do and how to handle them.

Note: This is a sponsored article, and it’s a part of a paid campaign, The Other Talk with Citizens Bank.

Here are a few others that might make your chin drop:  

• Millennials spend nearly one-fifth of their annual salaries on debt repayments, according to a recent Citizens Bank survey.
• Nearly six in 10 borrowers regret taking out as much in loans as they did, according to the same study.
• And, nearly half of college students believe they will be helped by federal loan forgiveness, according to research from QFinance. (To put it in perspective, fewer than 100 of more than 30,000 loan forgiveness applicants received it.)

What could have made for a happier financial picture for these students and so many others? Talking about the amount of borrowing – and the impact it would have on their future lives – in advance. That’s not something enough families do these days. Having a conversation like this may not be the most comfortable one – it’s hard for parents to acknowledge that they wish they could contribute more – but it’s a necessary one. Here’s how to go about it.

Start Young – With A Pep Talk

Your first conversation about college shouldn’t happen as the PSATs roll around. If that happens, you’ve missed years of opportunity. And, don’t start with debt. Start with what they might want to do with their lives.

“When kids are younger, career exploration is really what the early talks should be about,” says Reyna Gobel, student loan expert and author of the CliffsNote’s “Parents Guide to Paying for College and Repaying Student Loans.” A career is something students can get excited about, she notes. “If you’re not excited about something, you’re not really going to care about the debt conversation.”

Acknowledge The Cost – And That There Will Be A Plan For Paying For It

Woven into conversations about college should be a discussion about financing, says Joel Best, professor of sociology and criminal justice at the University of Delaware and author of “The Student Loan Mess: How Good Intentions Created a Trillion Dollar Problem.” “When you start talking to kids about going to college, you also need to start talking to them about how it’s going to be paid for.”  

When they’re young, this can be a general discussion incorporating the fact that you’re saving what you can and that it’s their job to do well in school so that they will qualify for scholarships and grants from schools that want them. As they get older, you can expand to a discussion of how choosing a college these days is a value proposition. It’s not just about going to the best school that accepts you; it’s about going to a school that makes it attractive for you to attend financially. That means you have to cast a wide net as you conduct your search.

Get Specific About What It Means To Borrow

One thing Best notes – and I’ve witnessed from college grads after the fact – is that while many understand that they’re borrowing, they don’t understand how it works, that interest continues to accrue, and what a sum borrowed translates to in repayment.

“If you have a house loan or a car loan, people will understand that, but they tend to treat student loans kind of like they’re magical,” he says. “I think a lot of people are not aware of what they’re getting into.” As part of the continuing conversations you have with your children, run some numbers.  Or simply look them up. Many schools have charts like this one from Penn State that show how much an amount borrowed translates to in monthly payments and what sort of salary you’d need to earn to make that payment manageable (manageable usually equates to between 5% and 15% of your income).  You’ll see, for example, that $25,000 in loans at a rate of 6% equals a $277 monthly payment and that you’ll need a salary of $41,000 or more to afford that comfortably. Borrow $60,000 and without a salary of $100,000 or more you’ll feel squeezed. Yes, numbers like this can be daunting. But not as daunting as finding out you can’t afford your own apartment because you overborrowed.

Be Realistic About A Career Path’s Potential

It’s one thing to borrow six figures knowing you’re going to work in finance or as an engineer where salaries are competitive and generally hefty. It’s another to borrow six figures thinking that you might want to work in publishing or for a not-for-profit. If you don’t borrow smartly, you’re setting yourself up for years of financial frustration.

“There’s a myth that student loans are always bad,” says Gobel. They’re not. But you do need to be realistic about what’s coming down the pike. And if you’re not comfortable having this conversation with your child alone, know that help is available. “Go to a financial aid officer at a local college and have them sit and explain it with you,” she suggests. “You can’t really tell your kids what or how much to borrow unless you understand the options yourself. They’re going to have these loans for potentially 30 years, you want them to understand them beforehand. An hour researching loans can save you years of heartache.”

With Amelia McBain

Note: This is a sponsored article, and it’s a part of a paid campaign, The Other Talk with Citizens Bank.

College is expensive — we get it. When you add it up, each year of tuition, fees, room and board can cost as much as an annual salary. Yikes.

Still, the worth it question is a tough one to nail. “When you try to give a blanket answer to that question, it’s always wrong,” said Reyna Gobel, student loan expert and the  author of the CliffsNote’s “Parents Guide to Paying for College and Repaying Student Loans.”The mostly right (and complicated) answer is that it depends. It depends on the kind of school your kid goes to, what the major is and if your kid even goes into the field their major is for.

“There is no one return, no one amount of money you get from a college degree, there’s no one cost,” said Dr. Anthony P. Carnevale, director of the Georgetown University Center on Education and the Workforce. “The question for young people is, ‘What’s the value of the degree I’m about to get?’”

It’s daunting to calculate the cost of every degree at each college and university, so let’s check out the averages. According to The College Board’s Trends in College Pricing 2017 report, we can see that a degree will cost an average $56,840 at a four-year in-state public school and $104,400 at a four-year private nonprofits.  And if you can’t pay it all upfront, you can expect to pay off student loan debt for years after graduation, which only adds to those totals. …

What’s the benefit on the other side? You’ll see that a recent college graduate’s average salary is $50,390. The average salary of someone with a high school degree is $35,356. There’s a big difference, and as each raise you receive tends to be based on the amount you earned before, the salary gap tends to grow rather than shrink over time.  

You can see that in these numbers: According to the Georgetown College Payoff Report, a Bachelor’s degree is worth $2.8 million over a lifetime, which is more than twice a high school degree ($1.3 million). An Associate’s, or two-year, degree (the cost of which runs around $16,000 on average at a community college)  is worth $1.7 million.

Bottom line? “In general, yes, college degrees are worth the cost,” said Carnevale. “Whatever benefits you get, stretch over 40 years.” So college (on average) is probably worth it, but there are a lot of ways to help your kid maximize the value of their degree. Here are just a couple of them:

Weigh the Financial Pros and Cons of Each School

The days in which you simply enrolled in the best-ranking college that accepted you are over. More than ever, college is a value proposition. Minimizing the amount of student debt you take on gives you a leg up on building a life when you get out.  That means casting a wide net in the application process and including schools likely to see you as someone who would be a big asset to the student body (and offer you money as a result).

Consider the Value of Your Major

No, not everyone is meant to be an engineer or a coder. But as you choose a school to attend, you should be cognizant of the fact that some fields pay significantly more than others. The top-paying majors earn $3.4 million more over a lifetime than the lowest-paying majors. “It all depends on your field of study,” said Carnevale. “What you take has a lot to do with what you make.”

And if you are going into a field that’s not especially lucrative, keep an eagle eye on the amount you borrow. “If you’re not going into something that’s going to make $200,000 and you’re borrowing $300,000 to go into school, that may not be a good idea,” said Gobel. “But if you pick a high-paying job like engineering and you’re not an engineer, you’re just wasting money until you switch to the major you really want.”

Note: This is a sponsored article, and it’s a part of a paid campaign, The Other Talk with Citizens Bank.

More than $145,000: That’s the approximate cost to send your freshman to a moderately priced, in-state public college or university according to The College Board.  It includes room and board but not a lot of other things like books, travel to and from, Saturday night pizza and beer. The cost of a public school if you’re out-of-state or a private college or university can soar far higher.  

And all of that is counting on the fact that your child will actually graduate in four years — these days it often takes an extra year or more for students to make it through.  Bottom line: You’re going to need a lot of cash to get your kid through school. Here’s how to get there without going into debt.

Retailers have launched their holiday sales well before the holiday. I actually wasn’t there to do holiday damage, rather to get a birthday gift for a friend and a pair of snow boots for my daughter (on which we scored 30 percent off at Cole Haan, plus an extra 10 percent for giving them an email address).

If you’re looking to make the most of Black Friday and the days that follow, our friend Edgar Dworsky at Consumer World pulled together his list of Top 10 Tips that include a reminder that not all Black Friday deals are actually steals. Use a price checker, he suggests, like the one at Consumer World or camelcamelcamel.com to separate the good from the bad. He, too, points out that getting a jump on holiday shopping can pay off. The good news: You’ll have more time this year than last. Why? Experts say you no longer have to brine the turkey.

Just Say No

If you do hit the stores over the next couple of days — or weeks — one thing you should say no to are the offers for store credit cards. According to a new survey from credit cards.com, about half of all Americans have impulsively acquiesced when offered a discount in exchange for adding another piece of plastic to their wallets. Here are two good reasons to say nay: The interest rates on these cards are absurdly high — they’re in the mid-20 percent range on average. (Just to put that in perspective, carrying a $2,000 balance will cost you $500 over the course of a year.) And, the act of signing up can ding your credit score as much as 10 points, which (if it moves you from, say, a good credit tier to a fair credit tier) could translate to hundreds or thousands of dollars in interest on loans that you really care about, like a mortgage or auto loan.

On the other hand, here’s a new financial services provider that we’ve got our eye on: Zero Financial. (Although, as the New York Times’ Ron Lieber notes, while there are good reasons to get excited by this offering, there are just as many to remain, in his words, “intensely skeptical.”) Here’s the deal: Zero proposes to be a one-stop shop for your banking needs. It combines a checking account (Zero Checking) and a credit card (Zerocard) that acts like a cash-back debit card. The service cuts you off if you don’t have enough money to make a purchase, meaning no overdrafts and no going into debt. And there’s a cash back rewards program. (Zero is making money on transactions, in case you’re wondering.) Folks who spend $100,000 or more a year get 3 percent back on everything, at $50,000 you get 2 percent back, at $25,000 1.5 percent and below that 1 percent. Should you make the switch? Lieber says for now he’s taking a wait-and-see approach. We’re with him on that.

Magic And Manners

The magic of the holidays seems to be kept alive by two things: the spirit of giving, and children. Their excitement around this time of year is contagious and it puts pressure on parents to not disappoint. But it’s important that your child understands that they aren’t going to get everything they want this holiday season, nor will they be in love with every gift they get. For tips on how to manage their manners and expectations this holiday season, keep reading here.

• The best donation is your money. This allows organizations to purchase exactly what is needed.
• There a variety of nonprofits looking for donations like the California Community Foundation’s Wildfire Relief Fund, Caring Choices and Entertainment Industry Foundation.
• GoFundMe has a page set up where you find campaigns for families who lost their homes in the fires.
• Finally, if you haven’t heard of a charity, make sure you check out its legitimacy and reputation. Charity Navigator is a good source to use.

And, if you have been affected by the wildfires or think you might be, it’s important that you know what steps to take when filing an insurance claim. (Actually, this is important information for anyone in any sort of natural disaster at any time.) First, make sure to document everything — take photos of your home and your belongings — so that you’ll be able to show proof to your insurer of what was damaged. (If you’ve got before photos, even better. In fact, if all is calm in your community, now would be a good time to take a set of those.) It’s also important to know the ins and outs of your coverage — does your policy cover hotel stays and meals if you’re displaced? Is there a cap on how much, and for how long it’ll cover those incidentals? For more tips on how to prepare your insurance claim, keep reading here.

In Pursuit Of F-R-E-E

If you’re like me (and many other rewards points hounds) the allure of getting a new credit card with a big fat rewards bonus sends your heart fluttering: 50,000 points, 70,000 points, 100,000 points, woo-hoo. But what then? If you’re like many cardholders, you’re leaving a lot of rewards on the table and that equates to missing out on free cash, travel and many other opportunities. It’s time to clean up your act. How? Well, for starters, as long as you’re not keeping a balance on those cards and paying high rates of interest, there’s absolutely no reason not to put every little charge on these cards. This will immediately boost the rewards you’re earning. Also, if you’ve got a card with rewards categories that you have to opt into to earn more points, it’s time to get with the program. We tell you how — and give you 5 other ways to snag more value from your rewards cards here.

The Target Effect

I once gave a talk to Target employees at their Minnesota HQ. Of course, I made a purchase in the company gift shop. A t-shirt that reads something to the effect of: “I went to Target and only bought what was on my list — said no one ever.” We’ve all been there: You pop into Target to get paper towels but then you walk out with a new bath mat, workout outfit, dishware set and a few candles. In fact, this phenomenon is so common that Urban Dictionary even recognizes as “The Target Effect.” If you need a Target intervention, here are some helpful strategies to curb your addiction. And if those can’t cut it, maybe you should consider a Target detox. If you need one item, like paper towels, try picking them up at a place that doesn’t appeal to your inner shopper quite so much.

Subject: Thank You

Finally, if you are an avid reader of this newsletter, you know that I love to highlight gratitude practices, especially the simple ones — like writing a thank-you note. But turns out you may want to put away your stationary set and ballpoint pen when writing a thank-you note to a hiring manager. According to an Accountemps survey, 91 percent of hiring managers said they like to be thanked. But 62 percent said that sending a thank-you via email was the best way to follow up, compared to the 13 percent that said a handwritten note was best. Handwriting your note and sending in the mail to a hiring manager is too slow, especially if the job is looking to be filled quickly. By the time your note gets there, a hiring manager may have already made their decision. Come the holidays, though, snail mail notes will be just fine.

Rewards credit cards can be an amazing way to get some money back for your purchases, to travel for free or to even save for college. But if you’re not paying attention to the way you’re using your credit cards and redeeming your rewards, you could be leaving some of that value on the table.

“You always want to be earning points that match your rewards goals, and [you want to be sure] that you’re using the card that earns those points the most quickly,” says Gary Leff, points expert and co-founder of frequent flyer community InsideFlyer.com.

Missing out on the full value of your credit card rewards? You’re not alone. Here’s what what to do if you’re making these common mistakes:

Not using credit cards for all your purchases

As long as you’re able to pay off the total bill each month, there’s no reason not to shift all your spending onto cards to increase the value of the rewards that you’re earning.

How to get more value: Make a conscious effort to shift your spending from debit or cash to your credit card, and then pay off your balance in full each month.

Letting rewards points expire

While most credit cards don’t allow rewards to expire, there are a handful that do. It’s easy to forget about a rewards balance on a card that you don’t frequently use.

How to get more value: Read the fine print on your account. Most credit card companies will reset the expiration for simply making one purchase with the card. If you’re phasing out that card, consider ways to spend down the rewards balance to avoid losing the points entirely.

Spending too little to get a signup bonus

As credit card issuers compete for customers, they offer sizable signup bonuses to new cardholders. The catch is that you have to spend a certain amount of money within the first few months of holding the card to get the bonuses. Fail to meet that threshold, and you’ll miss out on receiving the bonus.

How to get more value: Before applying for a credit card with a signup bonus, consider whether your current spending habits or upcoming expenses would allow you to meet the threshold for the rewards. (You never want to spend more money than you normally would just to get credit card rewards.) If so, put that card on the top of your wallet and use it exclusively until you’ve met the minimum spend.

Failing to opt in on for rotating rewards categories

Some rewards credit cards offer additional cash back in specific categories tied to the seasons.

The Chase Freedom card, for example, offers 5% cash back on shopping at department stores this winter, compared to 1.5% cash back on all other purchases. The catch is that you have to “activate” the categories by opting in.

How to get more value: Set an alert to remind yourself to opt in to the bonus categories as they happen throughout the year.

Forgetting about online shopping via portals

Many credit cards offer the chance to earn additional rewards if you use their online portals to get to a retailer for online shopping.  Barclays Reward Boost, for example, was recently offering an additional points bonus for cardholders who clicked through their portal before shopping at online retailers like Bed Bath & Beyond and L.L. Bean.

How to get more value: See if your card’s shopping portal offers a browser extension, which you can install on your computer for automatic notifications when you’re on a site that might offer additional reward bonuses.

Skipping a business rewards card

Many small-business owners use their personal cards for business purchases out of convenience, but the rewards offered by business cards may be even more generous than those on an individual card.

Bonus: Having a separate business card makes it easy to separate business and personal expenses for record keeping.

How to get more value: Apply for a business credit card, and make that your primary form of payment for business expenses.

“Many small-business owners don’t realize they can get a business credit card very early in their business,” says Gerri Detweiler, education director for the small-business site Nav. “It doesn’t need to be incorporated or making money, as long as they have a strong enough personal credit score and enough income from other sources.”

Carrying a balance on your rewards card

The average credit card interest rate for all new offers is nearly 20% —that’s way higher than the value of any rewards you might earn on purchases.

How to get more value: If you’ve got credit card debt, see whether you can roll it over to a card that offers an interest-free transfer. Then focus on paying the balance down before the promotional interest rate expires—and sit out the rewards game for a while.

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