Tag: Financial Planning Association of New Jersey

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New Jersey college loan Program will no longer Require Repayment of Student loans in the event of a student’s death

RHS Grad

HESAA Loan Program revises its rules to benefit grieving families.

February 1,2017

the staff of the Ridgewood blog

UPPER MONTCLAIR NJ , A student loan program that had placed parents of deceased students in an unthinkable situation has now been changed. The Higher Education Student Assistance Authority (HESAA) program previously required parents of a deceased child to continue to pay their NJ CLASS / HESAA loans as a co-signer. However, New Jersey legislators have recently amended the program’s terms and conditions.
John Crosby, CFP®, ChFC, CAS, CLTC, CRPC®, and Advocacy Chairperson for FPANJ, was thrilled at the change in the loan program.
“This change came a result of all the advocates fighting for the same Terms and Conditions available for Federal Student loans in the event of death or disability of the borrower or co-borrower. We are grateful for everyone who testified on behalf of families who were devastated by the impacts of the HESAA rules.”
 An article in the New York Times that detailed one family’s nightmare in dealing with their son’s death and his student loans through HESAA finally spurred discussion among New Jersey State Senators. In August 2016, Crosby had spoken to several of the legislators and those that officially testified to explain the process of borrowing, the liabilities of the co-signer vs. co-borrower and their un-forgivable legal obligations. Some had called the program “predatory” and “loansharking,” and testimony led to a unanimous vote by the Higher Education Committee to approve S-743, requiring HESAA to forgive the student loan of someone who dies before completely repaying it.
Crosby has counseled clients in similarly tough situations with HESAA. The program also had been characterized with extraordinarily stringent rules that can easily led to financial hardship. Loan repayments could not be adjusted based on income, and few breaks are given for unemployment or other hardship.
A memo from HESAA Executive Director Gabrielle Charette provides further details on all of the changes that are being made in the program.
“This is truly the power of advocacy for the greater good,” Crosby said. “FPANJ continues to act as a resource in educating legislators on topics like these. Now we are just happy that parents in this situation can start to move forward in healing.”
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Financial Planning Association of New Jersey “Know Your Money” Series Talks Taxes

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The second installment of a video series asks people about taxes, underscoring the importance of the role a CFP® and other professionals make.

January 19,2017

the staff of the Ridgewood blog

Ridgewood NJ,  The Financial Planning Association of New Jersey (FPANJ) continues its five-part video series to stress the importance of learning about your money, and how a Certified Financial Planner(TM) can play a role in reaching your financial goals.
After a launch in November covering estate planning, the latest subject is a timely one: Taxes.
The entire series features “man on the street” interviews with people, asking them questions based on topics that are important to know, yet many people can’t answer, even with a cash reward ($1) on the line.  Additional subjects will be released throughout the year and will include

College Planning, Social Security, and Health Care

 “Everyone is impacted by taxes,” said FPANJ President Rob Rafano. “It can be eye-opening for many who watch the video to realize what they don’t know. The purpose is to demonstrate all of the various issues that CFP®s help clients handle, and why not knowing what you don’t know can keep you from building wealth. The good news is that enlisting the help of professionals can help you reduce your tax liability, year in and year out.”
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The second installment of the Know Your Money on Taxes can be viewed on the FPANJ’s You Tube Channel. Additional videos can also be found there to help the public get to know FPANJ and learn more about their finances.

“We hope to continue the conversation among consumers on how to get started learning more about their finances, saving and investing more, and leaning on the expertise of financial professionals to get them there,” Rafano said, adding, “we are also relying on our local media to help educate the public, as there is always something happening in the news that these videos relate to.”

 

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Financial Planning Association of New Jersey Warns of the Cost of College Debt on Social Security

RHS Grad
January 6,2017

the staff of the Ridgewood blog

Ridgewood NJ, While Financial Planners have been advocating for smarter legislation on student loan programs for years, the news is finally spotlighting a concern over its impact on Social Security income if debts aren’t paid.

The Financial Planning Association of New Jersey (FPANJ) has long held advocacy positions in Trenton that have encouraged careful decision making with regard to student loan programs. However, the impacts haven’t been well publicized until recently, when the Wall Street Journal ran a piece on how Social Security checks can be reduced if debts for college aren’t paid.”Our efforts in public financial education – and in the Capitol – have included a message to stop the borrowing before it happens,” explained John Crosby, CFP® ,ChFC, CAS, CLTC, CRPC®, and Advocacy Chairperson for FPANJ. “The best solution to this issue is always to make an educated decision before you choose to borrow, where to borrow, and understand the types of student loans are available.”

The reality is that for student loans and other non-tax debts, the government can garnish wages or suspend tax refunds for anyon(e who fails to pay their student loans. They can take 15 percent of your Social Security check as long as the remaining balance doesn’t drop below $750. There is no statute of limitations on student loan debt, so it doesn’t matter how
long ago the debt occurred.

Crosby noted that lawmakers have an opportunity to protect Social Security in a bill (HR4988 Social Security Benefits Restoration Act) presented by Rep. Patrick Murphy (D-FL) in April of 2016. However, this bill is still awaiting a co-sponsor, along with similar proposals from 2015.

The best way to protect yourself is to become knowledgeable, said Crosby.

“Financial Literary programs can address this topic to help students and/or parents understand the importance of higher education and the financial responsibilities that come with it. Partnering with a Certified Financial Planner(TM) is the best course in understanding your options, whether you plan on paying for college or taking out loans.

“Often a candid discussion among a planner, parents and the student can help avoid serious financial consequences down the road. And really, that is what FPANJ and its members are here to do.”

If people don’t have a Financial Planner, Crosby recommended a tool found on the FPANJ website (FPANJ.org) at the top of the page. “Find A Local Planner” helps consumers look for a specialist in the area of college planning, and within their geographic area.

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Financial Planning Association of New Jersey Launches “Know Your Money” Campaign

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November 28,2016
the staff of the Ridgewood blog
Ridgewood NJ, The Financial Planning Association of New Jersey (FPANJ) is launching a new, five-part video series to stress the importance of learning about your money, and how a Certified Financial Planner(TM) can play a role in reaching your financial goals.
The series features “man on the street” interviews with people, asking them questions based on the following topics:
  • Estate Planning
  • Taxes
  • College Planning
  • Social Security
  • Health Care
“These are topics that everyone – regardless of their income – is impacted by every day, whether or not they want to think about it,” said FPANJ President Rob Rafano. “The purpose is to demonstrate all of the various issues that CFP®s help clients handle, and why not knowing what you don’t know can keep you from building wealth, planning for retirement and so much more.”
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The first installment of the Know Your Moneyseries will be on Estate Planning, and can be viewed on the FPANJ’s You Tube Channel. Its debut coincides with a presentation on December 13 on Estate Planning issuesregarding elder law that every CFP® should be aware of.

“We are hoping that this will start the conversation among consumers about how to get started learning more about their finances, saving and investing more, and leaning on the expertise of financial professionals to get them there,” Rafano said, adding, “we are also relying on our local media to help educate the public, as there is always something happening in the news that these videos relate to.”
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NJ Student Loan Program Called “Predatory” and “Loansharking.”

RHS Grad

As New Jersey senators came down on the state’s college loan program, Financial Planners stress the importance of developing a strategy early.

August 23,2016
the staff of the Ridgewood blog

Ridgewood NJ, After an article in the New York Times that detailed one family’s nightmare in dealing with their son’s death and his student loans through the Higher Education Student Assistance Authority (HESAA), New Jersey State Senators heard testimony on the program, which some have called “predatory” and “loansharking.”

“My own experience was very similar even in 1980 student loans we a scam and students were not provided with proper accurate information to make a rational financial decisions” the Ridgewood blog Founder James Foytlin

Financial Planning Association of New Jersey (FPANJ) Advocacy Chairman John Crosby was also in attendance in Trenton. He has counseled clients in similarly tough situations with HESAA. The program has been characterized with extraordinarily stringent rules that can easily lead to financial hardship. Loan repayments cannot be adjusted based on income, and few breaks are given for unemployment or other hardship.

“While there were no representatives from HESAA present, a letter from Executive Director Gabrielle Charette was submitted for testimony. I’m happy to say that things will be forced to change,” Crosby said. The testimony led to a unanimous vote by the higher education committee to approve S-743, which would require HESAA to forgive the student loan of someone who dies before completely repaying it, as the federal government does.

The experience with HESAA for many families is in stark contrast to Francis Astorino’s. His diligence in planning for college with his family began early, especially as his triplets eyed college with another already enrolled. A CFP® and President of The Astorino Financial Group, he recalled the struggle to put himself through school, and didn’t want the same burden for his children. He said it still took a lot of discipline and sacrifice to fund college for his four children, and it had to be a family decision.

“We put our kids to work early as early teens, helping in the office. And at about 16 years of age we sat them down and showed them the file with their balance sheet,” Astorino said. “However nice it was to say we could send our kids anywhere, we wanted them to know we weren’t going to fund their lifestyle, because we thought it was important that they had some skin in the game.”

Crosby said, “The key takeaway I get from both of these stories is how incredibly important it is – whether or not you’ve planned early – to have a CFP® Professional there. It goes beyond building wealth…it really is about protecting your home, your family and your livelihood.”

ABOUT FPA of New Jersey and FPA:

Financial Planning Association of New Jersey is part of The Financial Planning Association® (FPA®). FPA connects those who need, support and deliver professional financial planning. FPA believes that everyone is entitled to objective advice from a competent, ethical financial planner to make smart financial decisions. FPA members demonstrate and support a professional commitment to education and a client-centered financial planning process. Working in alliance with academic leaders, legislative and regulatory bodies, financial services firms and consumer interest organizations, FPA is the community that fosters the value of financial planning, and advances the practice and profession of financial planning.