This week we’ve received a wealth of education from America’s Financial Expert, Ellie Kay!  We’re finishing off the week with a Q and A session with Ellie Kay. These questions were taken from her regular appearances on ABC NEWS “Good Money” show.

You can comment on any of this week’s posts to enter into the drawing to win one of six books we’re giving away on Monday!  (If you’re reading this in email, you can post a comment here!)

Q and A With Ellie Kay

Q:  We have a child graduating from high school this year and want him to start out right with good credit scores.  How does a teenager go about starting to build good credit?                          

 Pam from San Franciso, CA

A:  I’ve launched two high school graduates in the past two years and I know how important it is for them to have good credit.  A good credit score will not only impact the interest rates they pay for a new car, but a the scores also determine whether they pay a utility deposit, if they’ll get a good job and how much they may pay for their auto insurance.

            First, they need to open their own checking and savings account near their college.  Second, they should apply for a credit card with a low credit limit ($500 to $1000).  They can either apply for this at their bank or find a credit card provider at .  Do not ever cosign for a credit card for your child and make sure they have accountability for the use of their card so that they do not get into credit card debt.  They should pay off their card each month or they should make a commitment to cut up the card if they cannot pay it monthly. Our oldest son, Daniel, started this way and has already built good enough credit scores to pre-qualify for a modest homeowners loan.  By starting small and paying consistently, they can begin to build good credit scores. 

Q:   I’m going to start college in the fall and my parents require that I pay for my own books.  Do you have any tips to save money in this area?                  

                                                                          Brittney from Crowley, Texas

A:    Save Big on Books by Renting  – Textbooks can be one of the most expensive items a college student needs to purchase when heading back to school this year, but they don’t have to be.  The average student pays more than $600 for course materials – the largest expense after tuition and room and board. By renting textbooks through Follett’s Rent-A-Text program, students can cut costs by 50 percent or more. CafeScribe’s digital textbooks are another great way to save, and both options are available to purchase in-store and online through

       Last year, Rent-A-Text saved students more than $130 million. And this year, Follett is doubling the number of titles in the program, which means students will have even more opportunities to save. I’m all about the ‘more bang for the buck’ when it comes to maximizing savings. We didn’t even know rental was an option until recently… we really wish it had been around when our first kids went to college.

  • While there are many options for textbook rental out there, make sure your rental program accepts payment options like financial aid or campus cards to ensure you make the most of your available funds.
  • A good rental program also saves you money by eliminating shipping costs, and allowing you to pick up materials at your campus store.
  • And, keep in mind there are a variety of affordable choices at the campus store from new, used, rental and digital.

Q:  Our twins are in their second year of college and we’ve been paying tuition for over a year.  Is there anything we might be overlooking in trying to find some ways to help pay for college? It’s really difficult financially with two in college at once!                                         Marie from Quartz Hills, CA

A:    It pays to keep looking for savings options even when you think you’ve exhausted all that is available to you.  For example, you and your student should regularly visit the university’s financial aid office, which is oftentimes a clearinghouse of information.  They not only help students determine what loans they qualify for, but they will steer them to participating lenders who are offering the best terms and service.  Parents can do their own assessment at with their “Paying for College” web page calculator.

The FASFA (Free Application for Student Financial Aid form) is the first step in applying for aid that includes:  1) need-based guaranteed loans (Staffordloans are variable and currently at 3.42% while Perkins loans are at a fixed 5%.)  2) Grants—the Pell grant and the federal Supplemental Education Opportunity Grant each provide a gift of up to $4,050 per student per student year.  3) Work-study.  Students can receive up to $2,000 per year, 25% of it matched by the participating institution, from the federal work-study program.  If a family is divorced, both parents still need to fill out the FAFSA. In fact, the only way a child can avoid having both parents fill out a FAFSA is if the child is declared emancipated or if the other parent doesn’t know about it (one is legal, the other is not). So, as much as it depends on you, be sure that BOTH parents are given the opportunity to fill out this form.

There are state loans and grants available and the financial aid office should be able to quickly asses the student’s eligibility.  Plus, this office will also direct them to scholarship applications and programs for both new and current students.

Q:    My husband and I want to help with our son’s college expenses (he graduates in two years) and we don’t want him to be straddled with huge student loans.  Several of our friends and other family members have said, “Just take out a second mortgage or use the equity in your home to pay for college.”  What do you think about that?             Marty from Topeka, Kansas

A:  I believe that you should never borrow on your own future to pay for your child’s future.  In any discussion of college costs, it’s important to keep priorities straight. Your kid’s education shouldn’t cost you your retirement. This means it’s not a wise idea to take out a home equity loan, an equity line of credit or refinance your mortgage in order to pay for school. This would reduce the amount of equity in your home, increase the risk of possible foreclosure and incur costs in interest charges that may cost more if the term on the new mortgage is greater than the remaining term on the existing mortgage.

Ellie Kay is a mother of seven (five by birth, two by marriage, all by love), a national radio commentator, frequent media guest, popular international speaker, and the best-selling author of ten books. Her newest release is The Sixty Minute Money Workout (Waterbrook/Random House Publishers,  2011)  To subscribe to Ellie’s free newsletter, go to

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