Surprise! College Costs Even More Than You Thought

photo credit: Reuters

By Carole Moore
Published August 16, 2011
Bankrate.com

Read more: http://www.foxbusiness.com/personal-finance/2011/08/16/surprise-college-costs-even-more-than-thought/#ixzz1VJ4c2V9z

You’ve calculated your college savings, loans and grant money, and have crunched the numbers to develop a workable budget. Now, how much was set aside for the occasional pizza?

“If a college student eats one pizza a week (off-campus), he’ll have spent $2,000 on pizza by the time he graduates from a four-year program,” says Mark Kantrowitz, publisher of FinAid.org, a resource for student financial aid.

That two grand probably wasn’t accounted for when you were calculating your typical college costs. Most families plan their college expenses based on figures provided by the colleges and universities themselves, which are very loose estimates on a degree’s cost and essentials such as transportation and textbooks.

Is college still worth the investment?

“The College Board reports that in 2010-2011, students could expect to spend an average of $1,137 on textbooks and supplies. A new financial accounting textbook can cost $150 to $200,” says Carole Walters of Flat World Knowledge, a publisher of free and open textbooks.

Graham Haskin, who graduated from Emerson College in Boston, says he was dismayed by the cost of textbooks, but the really big college expense came from using public transportation. “I took the T (subway) everywhere. The cost of the monthly pass or the cost of the per-trip rate was a surprise,” Haskin says.

The website for the University of North Carolina at Wilmington estimates student transportation costs at $1,452 per year, whether a student lives on campus or commutes. Since some students commute to their campuses from as far away as 50 miles, it’s good to keep in mind that individual college expenses will vary.

So That’s Where Your Money Goes

Because not everyone can be like Rodney Dangerfield’s rags-to-riches character, Thornton Melon, in “Back to School,” students have to rely on traditional financial planning methods. This involves anticipating rising college costs. However, few can forecast the rates at which today’s gas and grocery prices rise.

According to a College Board study, basic public college tuition alone has increased, “from 2000-01 to 2010-11 rang(ing) from 79% in the Middle States region to 161% in the West before adjusting for inflation.” Add in unplanned college expenses, and many who think they’re prepared are in for wallet shock.

“The dorm and dining hall provide the basics, but students will need everything from laundry money to shaving cream and probably cell service,” says Greg Karp, author of several books on personal finance. Students agree and, although some college costs are predictable, others sneak up on them.

Luke Mayberry, a drummer and music major at East Carolina University, in Greenville, N.C., says carrying a major like his costs extra bucks. “I was definitely surprised by how much money I was spending on sheet music and mallets/drumsticks outside of the required materials list I’d been given during the summer.”

Mayberry says he spent about $500 extra on equipment and sheet music at the beginning of his first semester. And music majors aren’t the only ones: Art and graphic design majors, for example, must often purchase expensive software as well as materials.

Kantrowitz adds that in some states, such as Florida, universities tack on an additional charge once a major is declared. “Those fees aren’t necessarily planned for,” he says.

A Few (Expensive) Things to Consider

After budgeting for the dorm or apartment, shelling out for a meal plan, paying tuition, activity and insurance fees, experts say you should plan for an additional $300 to $400 out of pocket each month to cover day-to-day extras. Here are some of the culprits most likely to drain your bank account.

Parking: Most universities charge to park on campus, even for dorm-based students. Expect to pay upward of $500 for two semesters of parking privileges at most major universities; less at community colleges and rural schools. And watch those parking tickets: An illegal five-minute parking job can end up costing anywhere from $2 (a no-parking zone at Brandeis University) to $75 (a handicapped parking ticket at Vassar College) in fines.

Sororities and fraternities: If your student pledges, then he or she (or you) will be on the hook for upward of $2,000 in fees and other Greek-associated expenses over the course of a college career. The University of Southern Mississippi at Hattiesburg estimates the average total new member cost for the first two semesters at $1,050.

Hidden apartment costs: Opting out of the dorm can be expensive in ways you might not realize. Most campus-style apartment complexes require 12-month leases, so you or your child will be paying for the summer months, even if he or she isn’t enrolled in school. If you sublet, benefit from Haskin’s unfortunate experience: He sublet his share of a home without a contract. When the renter didn’t pay and trashed the place, “I had no recourse. If you’re subletting, get a contract,” he says.

Laundry: Mom won’t be doing it anymore. If your kid has to pay to wash clothes, the costs of detergent and dryer sheets, as well as several bucks a load to use a community washer and dryer, will add up. Don’t laugh — doing two loads a week at approximately $3 per load (not including the price of detergent) could run college expenses up by more than $200 a year. It will cost even more if a student leaves his or her clothes unattended and someone walks away with them — an unfortunate but not uncommon occurrence.

Computer malfunctions: As soon as the warranty on your student’s laptop tanks, so will it — or at least it seems that way. If available, buying a computer through the college can be a potential route to take. While it can cost a bit more, the college often offers free or reduced tech support, which can help cut college costs and reduce long-distance parental anxiety. Laptop rental may also be an option, so check in with the university to find out if this is an option.

Unless your student is comfortable handling personal finances, resist the temptation to plunk a semester’s spending money on a debit card and trust it will last. Kantrowitz says that it’s best to start releasing your hold on your child’s funds gradually. Otherwise, you may find the money you earmarked for a bus pass has paid for a new iPod. And that’s one unexpected college expense that you can head off at the pass.

Amazon Battles States Over Sales Tax

from the TaxProf blog:

WSJ: Amazon Battles States Over Sales Tax

Wall Street Journal, Amazon Battles States Over Sales Tax:
Amazon.com Inc., the world’s largest online retailer, hasn’t charged sales tax in most states since its founding in 1994. And it has taken some extreme measures to keep it that way.

Among them: Staff traveling around the U.S. have been required to first consult a company map that shades each state red, yellow or green, said three people who have worked for the retailer. These people said they needed permission from managers or company lawyers before entering “red” states because a worker’s actions might trigger laws that force Amazon to collect taxes in those states.

Such steps to avoid local levies allow Amazon to undercut in-state retailers by the amount they must add in sales tax, which can exceed 8%.

A close examination of Amazon’s corporate practices, based on interviews with more than a dozen former employees and people who have done business with the Seattle company, as well as a review of corporate documents, indicates that the company believes its sales-tax policy is critical to its performance.

Credit Suisse recently estimated that if Amazon were forced to collect sales taxes in all states, it would lose as much as $653 million in sales this year, or 1.4% out of an estimated $45.5 billion in revenue. …

WSJ

Like many online retailers, Amazon says it is obliged to add state and local sales taxes only on purchases from residents of states where Amazon has physical retail operations. But it also has defined retailing narrowly as selling, so related operations such as warehouses don’t put it on the hook to charge tax, company representatives have said.

Amazon said it follows a 1992 U.S. Supreme Court ruling. Legal experts say the retailer’s approach is aggressive but within the law.

In response, lawmakers in nine states have passed new legislation aimed at limiting Web retailers’ wiggle room to avoid charging sales tax. Amazon is now challenging the bills through a lawsuit and a ballot initiative. It is simultaneously redoubling its efforts to avert triggering their requirements for tax collection by retreating from states it deems unfriendly.

State and local governments nationwide this year will lose $10.1 billion to $11.3 billion in sales taxes not collected by Web retailers, estimated University of Tennessee researchers in a 2009 report.

Blogs for Writers: Tips and Tricks

Oregon Writers Group - Singer Song Writing 1

http://www.flickr.com/photos/wolframburner/

Every writer needs a blog, right? But do you know how to create one or what makes people want to read your blog and return for more?

Author and owner of five blogs, Carol Topp, will be giving a presentation on Blogs for Writers: Tips and Tricks at the West Chester Library(Ohio) Writer’s Group on Wednesday, August 10, 2011 at 7:00 p.m.

The WCL writers’ group is hosted by and meets at the West Chester Library on the 2nd Wednesday of each month at 7:00 p.m. in the Conference Room.

The writers’ group is open to all writers, at all skill levels, and of all genres. The group meets for peer support and critique. Occasionally outside speakers will be brought in to discuss issues/concerns pertinent to the group. Contact: Amy Kleman,Librarian atamykleman@middletownlibrary.org or 513-777-3131

West Chester Library is located at 9363 Centre Pointe Dr., West Chester, OH 45069   513 777-3131    www.middletownlibrary.org

Basics of Accounting Are Vital to Survival for Entrepreneurs

New York Times

Business Day
By DARREN DAHL
Published: August 3, 2011
Business owners do not necessarily need to know how to prepare a balance sheet, but they do need to know which gauges to watch.

Few people start a business because they are good with numbers. In fact, the terms “accounting” and “financial analysis” tend to put business owners to sleep or send them screaming from the room. But to run a business effectively, most owners need to have some understanding of their finances.

Eric Schultz for The New York Times

Bart Justice, owner of a paper-shredding operation, credits his business’s survival with his decision to hire an accountant.

It is, for example, entirely possible for a company to be profitable but fail anyway because it does not have enough cash coming in to pay its bills.

“It’s like a racecar that goes too fast and runs out of gas,” said Doug Tatum, a serial entrepreneur who is a visiting professor of entrepreneurship at Middle Tennessee State University in Murfreesboro. Business owners do not necessarily need to know how to prepare a balance sheet, but they do have to know which gauges to watch.

One obvious step is to work with a bookkeeper or accountant, someone who can help navigate arcane accounting and tax rules and organize your affairs. But owners should understand that accounting is not just about paying taxes or reporting results.

“Small-business owners tend to hate accounting because it’s boring,” said Brian Hamilton, chief executive of Sageworks, a company in Raleigh, N.C., that tracks financial data for privately held businesses. “The mistake they make is not thinking about how they can use certain numbers as tools to better manage where their business is headed tomorrow.”

What follows is a guide to better understanding the numbers that drive a business. As the examples make clear, even smart people with advanced degrees can become confused by accounting issues.

Read more here.

even smart people with advanced degrees can become confused by accounting issues.” So true!

Carol Topp, CPA

How to Teach Your Kids About Money radio interview

I’m being interviewed on The Sociable Homeschooler today (Friday July 22, 2011) at 9 am EST on teaching our kids about money and starting a micro business.

Listen in at http://toginet.com/shows/thesociablehomeschooler

How to Teach Your Kids About Money

Link to Micro Business for Teens.com

Hope you enjoy the show!

Carol Topp, CPA

Audit flags and easy recordkeeping

I’ll be giving two sessions at the 2011 Ultimate Women’s Expo

Avoiding IRS Audit Flags (pre-recorded. Buy a ticket for all sessions. See below!)

Making Business Record Keeping a Breeze (live for free!)

May 19 Thursday at 2:00 PM EST

Carol Topp, CPA: Business Record Keeping a Breeze

Listen ONLINE CHAT Here or Call to listen live: 347-215-9316

Ready for a fun Virtual Women’s Convention??? One that promises to inspire you, encourage you, and equip you for your call as a godly woman? This is your event…or EVENTS! (Yep! We host regular events here just for women!)

Right there in the comfort of your home you can join us! We always have an amazing speaker line-up PLUS a Mommy Grab Bag that is completely amazing! Just imagine….

No crowds!
No makeup!
No parking!
No walking for blocks and blocks!
No expensive trips or hotel stays!
No babysitters!

Talk about FUN! This is one that you will not want to miss!

Everything is recorded live online so you can join us for each and every workshop–no conflicts with the schedule! You can listen bit-by-bit to every one of our wonderful speakers! AND! We have a WONDERFUL Membership Site available for all attendees–filled with articles, audios, and free ebooks to help you kick-off your best year ever!

PLUS! That is not all! We have the most AMAZING gifts for you from fellow writers/speakers/sponsors. They are already being added into our Membership Site, ready for you to dig into expo week. It is one of the most amazing offers ever! You will definitely want to join us!

PLUS! When you sign up! You get more!

  • Free ebooks!
  • Free bonus audios to help you get started on the right track!
  • Doorprizes and special gifts–ALL WEEK!!
  • Membership to our Ultimate Women’s Expo Membership Site–With lots of free articles, bonus Mp3 download audios, free printable planning pages, and wonderful savings from our speakers and sponsors!

Get Your Ticket TODAY!!

*************************************

What Your Child Can Learn From Starting a Business

The Ultimate Homeschool Expo 2011 starts Monday May 2!

UHSE2011Block1

I have pre-recorded two sessions:
5 Ways a Homeschool Co-op Can Benefit Your Child
and
Career Exploration for Homeschool High School Students

and on Wednesday May 4 at 11 am EDT, I will be presenting:
What Your Child Can Learn From Starting a Business

Does your child have a desire to earn money or share their talents in the marketplace? Encourage them to start a micro business. By running a micro business you child will develop skills in business, time management, speaking, writing and grow and mature in confidence all while making some money of their own!

The Ultimate Homeschool Expo is the largest on-line homeschool convention with over 100 sessions and 50 speakers.

Here’s a schedule for the week:
May 2 @ 11:00 AM EST Cindy Rushton:Lord, Give Me a Vision–YOUR VISION!
May 2 @ 2:00 PM EST Marnie Swedberg–Kitchen Shortcuts.
May 2 @ 4:00 PM EST Lorrie Flem:The Ten Suggestions for Moms.
May 3 @ 11:00 AM EST Rick Boyer:Take Back the Land.
May 3 @ 2:00 PM EST Debbie Strayer:Reviving Your Teaching and Your Students
May 3 @ 4:00 PM EST Coach Rick Andreassen-SAINTS Ministering to a Child’s Heart
May 4 @ 11:00 AM EST Carol Topp:What Your Child Can Learn From Starting a Business.
May 4@ 2:00 PM EST Kim Kautzer:College Prep: Is Writing on Track?
May 4 @ 4:00 PM EST Cathy Duffy:Learning Styles: Choosing Curriculum to Fit Each Child.
May 5 @ 11:00 AM EST Cyndi Kinney:Using the Psychology of Color in Education.
May 5 @ 2:00 PM EST Dr. “Doc” Thomas Sharp:Truth in Science: Biblical View of Dinosaurs.
May 5 @ 4:00 PM EST Regina Hicks:Incorporating a Thomas Jefferson and Classical Approach to Your Educational Adventure.
May 6 @ 11:00 AM EST Maggie Hogan:Highly Effective Habits of Happy Homeschool Moms.
May 6 @ 2:00 PM EST Denise Mira:7 Keys To Unlocking the Leader Within Your Child:
May 6 @ 4:00 PM EST Brian D. Ray, Ph.D. If Homeschooling Is So Good Why Don’t Educators Promote It?

Isn’t that a great line up?
But there are more audio sessions, a virtual vendor hall, with freebies like ebooks, audios, giveaways and door prizes.

Learn more here.

If you can’t join the Expo live, the workshops are recorded and you can listen on your computer or download to your mp3 player and listen at your leisure. I like to listen as I take my morning walk!

Tickets are $39.95, but on special for only $24.97 for a limited time.

Buy your ticket here

Carol Topp, CPA

All the Various Ways You Can Work From Home

Heart of the Matter Online has posted an article I wrote titled

All the Various Ways You Can Work From Home

“Work from Home!” the ads scream and get your attention. The offers sound great and all promise you can make excellent money working from home, but you may be confused by the opportunities that are offered for work at home moms. Are they  real jobs or just business opportunities? Are the workers employees or self-employed salesmen? Is all the work performed at home or are they only based at home and require time outside the home?

The options for working at home can be confusing. As a work at home mom who has been both an employee and a self-employed business owner, I will explain some of the opportunities available to moms that want to be at home but still earn a living.

Home-based or Completely-at-Home?

Be careful to distinguish between “work at home” and “home-based” businesses. The latter means your work is based at home rather than in a store or factory. It may mean that a lot of the work is done outside of your home, such as meeting and serving clients, or delivering products. This may mean juggling childcare and family demands.

On the other hand, many businesses can be run completely from home including daycare, transcription, virtual assistant, web design, writing and editing, and  internet-based businesses. Shaunna Howat is the Academic Coordinator for the Potter’s School, an on-line school offering classes for homeschool students across the globe. She works completely from her home—except the time a power outage meant she had to work from from a nearby coffee shop with Wi-Fi!

My website designer, Kelly McCausey, is a work at home mom. Her business is internet-based and completely-at-home. Kelly has moved her business twice in the past 3 years as she moved her home.

Employee, Independent Contractor or Business Owner?

Both home-based and completely-at-home opportunities can be as self-employed business owners, such as Kelly, my web designer, or as an employee such as Shaunna. Before you begin working for any business ask the owners if you will be an employee. If they say you will be an independent contractor, then you are considered self-employed for tax purposes and will be responsible for making your own income tax and Social Security tax payments. It’s recommended that you consult a tax expert to discuss your tax obligations as an independent contractor.

Telecommuter

Telecommuting means you are an employee of a business, but work via the telephone (or internet)   from your own home. Some telecommuting jobs come about from a current employer who allows workers to work from home. I worked full time for six years before I had my first daughter. Then I arranged to work from home part time as a telecommuter. I did the same job as before and for the same employer—I was just at working from my home instead of at the office.

Finding a new job as a telecommuter can be difficult because you must already have the skills a potential employer is looking for such as writing, bookkeeping, computer software design, medical transcription, editing, etc. Be careful to avoid scams. Tishia Lee, a work-at-home mom posts telecommuting jobs weekly on the WAHMTalkRadio.com blog and warns readers:

While these (telecommuting jobs) have been researched and seemed to be legitimate work at home jobs you still need to be careful and watch out for scams! Just remember that you should NEVER have to pay someone to work for them! If someone asks for money that’s a red flag! [1]

You can use Tishia’s site to find telecommuting jobs or try employment web sites like Craig’s List and Monster.com. Search for jobs that match your skill set. Avoid jobs that prominently mention “work at home.” Working at home is a benefit, not a job title.

Homeschooling mother Katy D. of Loveland, Ohio found a job working as an on-line tutor  helping students with essay writing and English homework. She works from 8 p.m. to midnight several evenings a week. “I wanted a job that allowed me to be in my home, but also not have clients or students come into my home; my 2 year-old is too disruptive.” She finds that the evening hours are very productive. Her biggest pitfall is that she makes only half of what she could make by doing private in-home tutoring, “Right now at this point in my life, on-line tutoring is a good fit,” she explains.

Sales for Another Company

Many advertised home-based businesses involve as selling products produced by another company such as Mary Kay, Pampered Chef and Usborne books. These are considered “home-based” because you will work some time at home making phone calls and placing orders, but many hours are spent outside of the home also.

Many homeschooling mothers enjoy this type of work because their selling “parties” offer an opportunity to get out a bit and are frequently held in the evenings when a spouse is home with the children. Cindy, a jewelry sales representative from Forest Park, Ohio, finds that the best part of her work is dealing with people. “Getting people to commit to booking a party and return my phone calls can be difficult,” she admits. “But I have met the nicest people, too.”

Business Owner

Many home businesses are operated by people who do not work as an employee or independent contractor, but rather own their own business. People are finding hundreds of ways to make money from their homes. The internet opens the door to several ideas including:

  • Web design
  • Advertising via websites and blogs
  • On-line auctions
  • Information products and electronic books
  • Virtual assistant helping businesses with newsletters, marketing, and administrative tasks

Cindy Rushton converted her home-based book selling business to a completely-at-home business selling electronic books. She used to travel the country selling her books and CDs at homeschool conventions, but now sells only ebooks and audio  files of her books. It’s the same business, but has a different way of delivering the products that allows her to be home all the time.

Don’t neglect old stand-byes that are low(er) tech, but still viable businesses such as:

  • Childcare
  • Accounting and bookkeeping
  • Music teacher
  • Fitness trainer
  • Caterer
  • Tutoring
  • Consultant
  • Artist
  • Dog trainer, groomer or daycare

I love running my accounting business from my home. Usually my tax clients come to me and I rarely leave home unless I want to. Many of my clients are nonprofit homeschool groups that are not even in the same state, but because of the internet I can work for them remotely.

As you can see there are many options when it comes to working from home. As you consider the alternatives be sure to discern whether you will be home-based or completely-at-home. Also inquire as to whether you will be an employee or a self-employed independent contractor.  Finally, you could consider starting a business that is run from your home.

Carol Topp, CPA is an author and accountant bringing cents and sensibility to families, small/micro business owners, and nonprofit organizations. Through her writing, speaking and consulting, Carol converts tax rules and business language into clear, easy-to-understand English. She is the is the author several books including the Micro Business for Teens series, Homeschool Co-ops: How to Start Them, Run Them and Not Burn Out and is currently working on Business Tips and Taxes for Writers for release in June 2011. Carol worked for the US Navy as a cost analyst before obtaining her CPA license in 2000. She lives in Cincinnati, Ohio with her husband and two daughters, both homeschool graduates. You can find her site at Carol Topp, CPA

“Taxman” with Eric Clapton and George Harrison

In celebration of April 15, the traditional tax due tax, and April 18 the tax due date for 2011, I thought you’d like “Taxman” with Eric Clapton and George Harrison

Let me tell you how it will be
There’s one for you, nineteen for me
‘Cause I’m the taxman
Yeah, I’m the taxman

Should five percent appear too small
Be thankful I don’t take it all
‘Cause I’m the taxman
Yeah, I’m the taxman

(If you drive a car car) I’ll tax the street
(If you try to sit sit) I’ll tax your seat
(If you get too cold cold) I’ll tax the heat
(If you take a walk walk) I’ll tax your feet

Taxman!

‘Cause I’m the taxman
Yeah, I’m the taxman

Don’t ask me what I want it for
(Ah, ah, Mr. Major)
If you don’t want to pay some more
(Ah, ah, Mr. [..])
‘Cause I’m the taxman
Yeah, I’m the taxman

If I reduce it, can you sleep
(Ah, ah, Boris Yeltzin)
Get back [..] V.A.T.
(Ah, ah, Mr. Bush)
‘Cause I’m the taxman
Yeah, I’m the taxman

If you get a hat hat, I’ll tax your hat
If you get a cat cat, I’ll tax your cat
If you wipe your feet feet, I’ll tax your mat
If you walk away away, I’ll tax your [..]

Now my advise to those who die
(Taxman!)
Declare the pennies on your eyes
(Taxman!)
‘Cause I’m the taxman
Yeah, I’m the taxman.

And you’re working for no one, but me
(Taxman!)

Yes, I’m the taxman
Yeah, I’m the taxman

What happens to tax refunds if the government shuts down?

From the National Association of Tax Professionals;

Important Information Regarding the Possible Government Shutdown and its Impact on IRS Services

The possibility of a government shutdown at midnight April 8 has forced the IRS to make contingency plans.  This is what we know at this time:
  • The April 18 filing deadline for Form 1040 returns remains in effect.
  • Tax payments will be processed as usual.
  • Returns filed on paper will not be processed until after the government resumes normal operations. This will delay refunds on paper filed returns.
  • E-filed returns will be processed as usual with no delay in refunds
  • Taxpayers who have an appointment scheduled with the IRS (audit, collections, appeals or Taxpayer Advocate cases) during the period of the shutdown should assume the appointment has been canceled. These appointments will be rescheduled when normal IRS operations resume.

Business as usual for CPAs and tax preparers!

Carol Topp, CPA