What to Put on and Take Off Your Holiday Shopping List

by Gerri Willis

Don't miss our special "User's Guide to Shopping" tonight on The Willis Report 6pmET FOX Business. Black Friday beckons shoppers to malls all over the country with the promise of good deals. Last year, day-after Thanksgiving sales totaled $59.1 million and this year 55 percent of us are expected to shop on Black Friday. But getting good deals is more art than science. In truth, some of the so-called deals aren’t all they are hyped up to be. In fact, Black Friday may benefit retailers more than it helps consumers. After all, that’s where Black Friday gets its name. It marks the first day of the year that some retailers actually stop operating in the red, and begin to make a profit. The good news is this: Because forecasts for the season show consumers may be stingier this year, spending 2 percent less than 2012, retailers are likely to be more aggressive with markdowns.

 So what should you put on your shopping list and what should you leave off? According to the folks at dealnews.com, there are three things you will want to avoid buying on Black Friday. First off, toys are typically better bought closer to Christmas. No doubt you might get some kind of discount on Black Friday, but ask yourself how you will feel if you buy now and see a lower price later. Likewise, stay away from the brand-name high definition televisions.  Other sets are typically discounted at this time of the year, but not the brand name ones. You’ll have to wait until after Christmas to get the best deals. And, finally, hands off the Christmas decorations (for now at least.) You’re probably not shopping on Black Friday to snag decorations, but it’s all too common to add them to your shopping basket. Hold off on the impulse buys and wait till closer to the holiday (or even after) to get that Musical Charlie Brown Christmas tree.

 To get the real deals, the biggest markdowns will go to the most creative. Demand for wedding dresses nearly disappears at Christmas, so the markdowns are the biggest. Likewise, most of us aren’t shopping for apparel or shoes. Apparel, especially high-end apparel, is heavily discounted at luxury retailers on Black Friday. Last year, Nike, Puma and Rockport had site wide sales of up to 50 percent off. For the techies in the crowd, watch for Microsoft Surface tablets – the first generation – to be marked down.

Good luck, and remember, the best deals will go to those with the most patience. 

Holiday Shopping: Not So Simple Anymore

by Gerri Willis

Don't miss our special "User's Guide to Shopping" 6pmET tonight on FOX Business. Remember the good old days when you would go to an actual, physical store to get a look at a product you wanted to buy, and then go back home and purchase that same product online for less money? This year, it just won’t be that simple anymore. That’s because major retailers and big box stores who experienced the brunt of the “showrooming” trend, that is to say squeezing the Charmin in the real world and going home to buy online, are having their revenge. They are beefing up their price matching policies this year and hoping more of us “webroom,” that is shop online and buy in store.

They may win. A survey of shoppers conducted by Accenture, shows 65% of shoppers this year will browse online and buy in store versus 63% who will buy online.

If the trend is the friend of brick and mortar retailers, they are trying to exploit it to their advantage. More and more of them are opening their doors on Thanksgiving. Best Buy will open at 6 p.m. next Thursday, while Toys R Us will open for four hours from 5 p.m. tp 9 p.m. Target will open at 8 p.m. Macy’s and Kohl’s will open on Thanksgiving for the first time this year. And, then there are the stunt promotions. Best Buy just announced the exclusive sales of the blue Samsung Galaxy S4 starting Nov. 14.  

There is a lot at stake in this year’s holiday shopping season. Sales are expected to be down 2% from last year and retailers are using every trick in the book to land sales. For example, retailers have found that people who access a store’s website or app while in the store are 33% more likely to buy an item that day, says Andrea Woroch of Kinoli Inc. For that reason, Target is offering free Wi-Fi in its 1,750 stores. Macy’s is using what it calls “social retailing” to lure buyers, for example, promoting a “Magic Fitting Room” in which shoppers can try on styles virtually and put up the results online.

Watch, too, for location based deals. Brick and mortar retailers, taking a page from daily deal and flash websites, will offer coupons and discounts to shoppers via their mobile devices. Watch CouponSherpa, Foursquare and Shopkick for rewards and “check-in” deals.

It’s a brave new world when it comes to shopping for the holidays. Let’s just hope Mom and Dad can keep up!  

Is Black Friday Turning into Black November?

by Gerri Willis

Don't miss our "User's Guide to Shopping" special starting 6pmET tonight on The Willis Report. Does it feel like holiday shopping sales are starting earlier and earlier? You’re not wrong. Faced with a short holiday shopping season and forecasts of lower spending, retailers are expected to be more aggressive than ever in rolling out early sales before Thanksgiving. According to the National Retail Federation, we’ll spend $738 on average for gifts, that’s 2 percent less than last year. But the retail industry’s pain is going to be your gain. Retail experts say to watch for big discounting as retailers try to lock in sales early.

So what should you put on your shopping list if you are headed to the mall the day after Thanksgiving? Black Friday is typically the only day of the year Apple discounts its products. If they don’t offer discounts, check out retailers like Best Buy to see if they are offering any price breaks or discounts for people who buy multiple Apple products at one time.

Other categories which are typically discounted this time of year: non brand-name televisions, cookware and household appliances and clothing (but not coats or other winter apparel). Better label cookware seldom gets discounted and so it’s a good opportunity to get a low price for you or a loved one.

What should you leave off your shopping list? According to the folks at dealnews.com, there are three things you will want to avoid buying on Black Friday. First off, toys are typically better bought closer to Christmas. No doubt you might get some kind of discount on Black Friday, but ask yourself how you will feel if you buy now and see a lower price later. Likewise, stay away from the brand-name high definition televisions.  Other sets are typically discounted at this time of the year, but not the brand name ones. You’ll have to wait until after Christmas to get the best deals. And, finally, hands off the Christmas decorations (for now at least.) You’re probably not shopping on Black Friday to snag decorations, but it’s all too common to add them to your shopping basket. Hold off on the impulse buys and wait till closer to the holiday (or even after) to get that Musical Charlie Brown Christmas tree.

Cyber Monday is typically the biggest day for online discounts. Candice Cerro, a consumer savings expert, says the big theme this year will be online deals and sales, which could be bigger than Black Friday sales. So, in your search for the best price on any given gift go online first this year.

Obamacare: What to Expect

by Gerri Willis

Join us for a special show tomorrow night starting 6pmET – a panel of experts answers all your Obamacare questions! E-mail me, tweet me @GerriWillisFBN & call our show at 1-877-249-9626 to have your questions answered LIVE!

All week we’ve been talking about open enrollment for the Obamacare insurance exchanges but October is also when sign ups start for corporate health plans. Of Americans who are of working age, 58 percent get their health insurance coverage through employers and for those who do it’s an essential part of their compensation.  Last year, employees paid just 21 percent of overall health care premiums. Employers picked up the rest.

So what can we expect this year?

  • You’ll pay more for coverage. Aon Hewitt’s experts see prices rising – not because employers are spending less but because they are keeping the percentage of their contribution at year-ago levels while overall healthcare prices rise. Aon forecast last year that for 2013 premiums would rise a whopping 6.3 percent. Employee costs  were expected to rise to $2,385 for premiums and  $2,429 for out of pocket costs like co pays and employee contributions. Employer costs were expected to rise to $11,188 for the year. What’s more, almost one in five employers are facing increased surcharges for adult dependents for access to coverage elsewhere.
  • Watch out for more high-deductible plans, also called consumer-driven health care. These plans carry low premiums but employees with this coverage can be on the hook for huge costs if they experience an emergency health problem or life-threatening illness. But the low costs of these plans have made them popular with younger workers, and employers are moving to satisfy that demand. In fact, some employers are making these plans more attractive by subsidizing premiums at higher levels than other plan options.
  •  More free stuff for people who engage in healthy behaviors, like smoking cessation classes or gym memberships. (Of course, more companies may offer more penalties, as well.)
  • A redrawing of the lines of who gets coverage. Aon says Obamacare and the individual mandate is pushing companies to reconsider who can get coverage.

Bottom line, employers are trying to reduce or at least hold even their costs for employee health care. For that reason and the fact that the plans are changing, you’ll want to do more than just check the box for the plan you had last year. Aon health and welfare benefits leader Craig Rosenberg recommends carefully reading and understanding the details of each of the plans you are offered.

 

 

Congratulations, You've Graduated! Now what?

by Gerri Willis

Join us for our week-long series on education on The Willis Report 6pm & 9pmET on FOX Business.

If there’s one thing I learned this week listening to the pros talk about college and the job market, it’s this: Nothing is going to come easy. The truth is, even though the unemployment rate for people aged 20 to 24 is well above the national average at 13 percent, good candidates are still finding jobs. Just this morning, I spoke with a college administrator who said her university had placed 60 percent of their graduates.

The question is this: How do you get to be one of the lucky ones? One answer to that is to attend one of the many institutions that place a priority on helping graduates get jobs. Some schools are just better than others. Penn State University’s job office starts meeting with students in their Freshman year to get them thinking about how they will apply their education in the real world.

“Some students think the only way to get a job is to simply find a job announcement and apply for it, or simply go to a career fair and approach an employer. It’s not as simple as that,” says Jeff Garis, the university’s Career Services Director. “It’s all about the student taking personal control with the help of their university in developing their goals, and developing a good, proactive job search. Most students get their jobs by going out after positions.”

Taking personal control can take many forms. One way is to get experience in your chosen field before you graduate. Even if that experience is unpaid, it’s valuable when it comes to finding a real job.

And, be sure to bring a little something extra to the table. Too many marketing majors, for example, pitch themselves as the perfect salesman for any product. Instead, they would be better off developing a niche or specialty that they can show off in an interview. By showing that you can narrow down and be specific in your approach to a problem or task, you give a potential employer evidence that you know how to problem solve and shape your talents to a specific client.

And, speaking of being specific, if you do use a print resume (not everybody does these days), be as concrete and detailed as you can in your description of your work history and experience. Leave out the high faulting language about your aspirations for your career. Human resource executives don’t have time for the boilerplate nonsense.

And finally, as everybody told me this week – it’s all about networking. Listings on the major job sites like www.monster.com can draw hundreds of thousands of resumes in seconds. Standing out in a crowd that big can be tough. Worse, a lot of human resource departments use computer programs to separate the wheat from the chaff.  In an automated HR world, you’re better off developing relationships with people who get to know you over time.

Consider your job search an exercise in seven degrees of separation. If there is a particular company you want to work for, you need to develop a relationship with people who already work there. Social media is key to getting in the game and making contacts with people who can help. These days, companies maintain active Twitter feeds, follow your prospects to learn what they are interested in and talking about.

 And, for anyone out there looking for a job: Good luck!

The Do-It-Yourself Degree

by Gerri Willis

Join us for our week-long series on education on The Willis Report 6pm & 9pmET on FOX Business. When it comes to paying for college, desperation was the soul of invention for Jay Cross, the founder of www.doityourselfdegree.com. As a junior at the University of Connecticut, Cross was in the uncomfortable situation of needing 30 credits to graduate and get his bachelor’s degree, but the college was not offering the classes at the time. Infuriated, he began researching how he could get the course credit and get out into the real world without spinning his wheels.


“I came across this credit-by-examination strategy where you could take a test instead of a course,” Cross recalls. Inspired, he decided to join the few thousand students across the country who were already testing out of course work and he finished his degree and promptly started the website to help other students get access to the information on credit-by-exam which had been scattered all over the Internet.


Cross admits that a DIY degree isn’t for everybody and says that some study areas are more likely candidates than others, such as business, accounting, psychology and computer science. However, many of the so-called STEM courses in math, engineering and the sciences are not a good fit because of the need for hands-on learning.


Cross’ solution is one of many that parents and students across the country are seeking out to reduce the costs of going to college. With outstanding student loan balances approaching $1 trillion, the heat is on to find ways to lower fees and tuition. Lynn O’Shaughnessy, author of The College Solution, says that one of the problems is that parents have no idea what they will end up paying. Most of them see the “sticker price,” that is, published tuition numbers, but it’s difficult to know exactly how much aid your child might get. Fortunately, the College Board has a net price calculator that can help you figure out what your real costs will be. Go to www.netpricecalculator.collegeboard.org for details.


She also suggests getting off the beaten trail. Big schools in big cities along the coasts, she says, have the highest prices and skimpiest aid packages, like New York University, Santa Clara, and Northeastern. Value schools can be found throughout the Midwest, mid Atlantic, the South, and interior West.


And, finally, she recommends choosing a school that has high graduation rates. Only 31 percent of students at public schools and 52 percent of students at private schools graduate in four years. You can find that information at the Chronicle for Higher Education’s College Completion website, at www.collegecompletion.chronicle.com.

Getting the Right Financial Aid Package

by Gerri Willis

Join us for our week-long series on education on The Willis Report 6pm & 9pmET on FOX Business! First the good news: don't regard that eye-popping tally of frosh college costs your son or daughter just handed you as the last word.  In fact, a better analogy is that it's just the sticker price, the suggested payment that school administrators hope you fall for.  Paying for college these days isn't a matter of making good on their wish list, but putting one together that works for you.

The reality for many schools is that they are competing mightily for a declining number of students. In today's environment, don't assume a large state or public school is the best option. Even with a higher sticker price, a small, private school may still give your son or daughter more free money. The flip side of that competition is this: Shop with care. More than one higher education finance expert told us that a small number of the nation's 4,495 degree-granting institutions may not even be around in four years because of declining state funding dollars and enrollment.  The last thing you want to do is pick an institution because of its great aid package only to find out it's not open the following year. Watch out for a new tactic by out-of-state public schools. With federal aid dollars dwindling, they are looking to make up the difference from out-of-state students. That "safety school" plan you envisioned may need an update.

The building blocks of a typical aid package are the following: Federal need-based grants, work-study funding, and subsidized Stafford loans. Subsidized means the government pays the interest on your loan while you are in college. Plus, there are merit-based scholarships offered by the institutions themselves. Then there are unsubsized federal loans and parent PLUS loans for mom and dad. The last of the list are private loans offered by banks. Generally, the further you travel in this laundry list, the more you pay in interests and fees.

You have to fill out the Free Application for Federal Student Aid (FAFSA) to be considered for any of these options. To get the best results, start early, way early. According to Kal Chany, author of "Paying for College without Going Broke," parents should think about college planning like they do tax planning. He suggests applying for aid as early as the ninth of tenth grade to get a sense of how you fit in.

As you begin to assess what you can afford, understand this: If you think there is any chance of getting financial aid, don't put any money in your child's name. That's because federal aid assessment formulas will require that you put more of your child's money to work. The name of the game is keeping control over your money. According to those formulas, typically 20 percent of your child's assets and 50 percent of the child's income will be assessed in determining how much they can afford to pay for school.  For parents, those levels are 47 percent of income and 5.65 percent of assets.

In other words, federal rules would require a $2,260 payment from a $40,000 college fund held in the parents' name versus an $8,000 payment from a fund of the same size held in the child's name.  At that rate, your college fund will be depleted fairly quickly.

"The schools won’t tell you how to position yourself for the most aid," says Chany. "You have to be savvy with process."

Chany also suggests that parents minimize discretionary income. Adjust withholding to minimize refunds, avoid early distributions from retirement plans, minimize capital gains, and don't cash in savings bonds in the years your income is being analyzed for student aid and loans (typically a year before you need the money.) The college expert says he's he has seen parents take college planning too far by turning down raises or having a spouse quit their job. Chany says that's going to extremes. Delaying a bonus into the the next tax year makes sense, but turning down income does not.

It's not just the parents who should be on the hook for financing a college education. Prospective students can contribute as well. I was a work-study student, earning money that helped pay for my education even as I took classes. That's still a good option. Another is applying for scholarships. Some college counselors urge students to apply for every possible scholarship imaginable, hoping some obscure fund will pick up 100 percent of Johnny's costs. Truth is, lucrative scholarships attract thousands of applicants. A better option for many students is applying for local, small scholarships awarded by community organizations, like your church or chamber of commerce.

Two-thirds of college students take out loans. For that reason, keep in mind that some are better than others. Exhaust federal loans first because they lock in fixed interest rates and have flexible repayment options, such as reduced monthly payments for low earners. Stafford is the best, and in late July, Congress passed legislation that ties undergraduate Stafford interest rates to the 10-year Treasury, adding 2.05 percentage points. Your rate is locked for the life of the loan, but can readjust each summer for new borrowing to a cap of 8.25 percent. This academic year, they have a fixed 3.86 rate for undergrads.

Dependent students can borrow up to $5,500 for their first year of college, with no more than $3,500 subsidized. Beyond that, parents can take out federal PLUS loans to a maximum of the cost of attendance. But watch out Mom and Dad, the interest rate is 6.41 percent (Treasury plus 4.6 points). The cap is 10.5 percent.  Another possibility that some parents have found attractive is using home equity loans that carry a lower rate of interest than the Plus loans.

The landscape of college loans and grants is changing and mightily. Chany reminds parents that once you strip away the ivy, what you have is an education business. And, that means parents should negotiate for the best aid package they can get.

 

 

 

Picking the Right College

by Gerri Willis

Join us for our week-long series: It's the ultimate guide to college on The Willis Report 6pm & 9pmET on FOX Business. You’d think that picking a good college for your young daughter or son would be easy. After all, maybe Susie or Johnny wants to attend your alma mater, though, more likely, they’ve always had their eye on the short list of party schools. In truth, there are more than 4,500 degree granting institutions to choose from and figuring out the best institution for your child is no easy problem to solve. And while college was once considered a great place to “find yourself,” the escalating costs argue against wasting any time at all.

Fortunately, there are lots of guides for parents and their kids to help sort through all the options. Brian Kelly, editor of U.S. News & World Report’s Best Colleges, guides the exclusive rankings of 1,800 institutions based on half a million data points. He says the first thing to consider is which institutions your son or daughter’s grades and SAT scores will make them eligible for. Fortunately, there is a shortcut. Enter in the names of the schools on your shortlist at the website www.cappex.com for a scatter gram of SAT and ACT scores and student acceptances.

Other metrics that will help you narrow the field and choose quality institutions, says Kelly:

  • School spending per capita on educational programs. Escalating tuition costs aren't necessarily being spent on instruction. Instead schools are putting their money into fancy    student unions, climbing walls and sushi bars. None of that will help your child prepare for the real world.
  • Alumni giving is a good way to feel out how well graduates perform in the workforce. The higher the proportion of alumni who contribute, the better.
  • Freshman retention is also key. Are students happy? Or, are they leaving in droves?
  • Likewise, graduation rates are worth checking. Overall, dropout rates over four years are approaching 50 percent -- an astonishing figure. The last thing you want to do is pay for half of a college career and have your child drop out.

But it's not all about the numbers. It's all too easy in the rush to apply to forget the fact that the institution you and your child are choosing will be more than just the place where they graduate; it will also be their home for four years. Steven Roy Goodman, an admissions strategist, advises parents and students on how to find the right fit. He says the goal is to find the college where your child is most likely to succeed. "You want your child to go where they feel comfortable," he says. "It has to do with questions of social class, and politics. It's where you fit in. Some kids think it would be cool to go to Harvard, but a lot of people would be uncomfortable there."

And, that means considering things like -- is it important for Junior to be close to home? Does he learn best in large classes or smaller ones? Is your student absolutely pre-med or pre-law?  How does he learn best? Costs, of course, will be critical as well, but Goodman advises not to forget some of the softer issues that can make a big difference to students getting acclimated to a new environment.          

              

User's Guide To Education

by Gerri Willis

When everybody agrees on something, it’s usually worth questioning conventional wisdom. And, so it is with the value of a college education. Over the years, parents have been told that a mere college degree will guarantee little Johnny a secure future and even a million-dollar pay premium over high school grads. But these days Johnny is lucky if his sheepskin buys him a job.

All this week we will help you fight back against the high cost of education with our series, User’s Guide to Education. Check this space for updates and log onto Twitter @GerriWillisFBN and Facebook for more information or to voice your concerns and questions.

Turns out, the financial benefits of a college degree are way overstated. The million dollar advantage for students earning undergrad degrees, if it ever existed at all, is largely being discounted today. Some experts say a more accurate value is $300,000 and others say $500,000. Regardless, the numbers are an average and there is no guarantee your child will earn the same. And, it’s cold comfort for parents who watched an enterprising 17-year-old Brit sells his news reading app to Yahoo for $30 million last year. Clearly, you don’t have to have a degree to earn money.

Even so parents and their kids cling to the advantages of the four-year undergrad career despite the fact that prices are only going up. Annual tuition inflation continues to perk along at 3 to 4 percent above the broader economy’s price hikes. CourseSmart estimates that over the past 30 years tuition costs have risen 1,120 percent while healthcare has gone up just 600 percent and housing has risen 375 percent. An education is four times as expensive as it was 30 years ago. Today, a single year at a public institution can run you $22,261 if you count everything from room and board to beer. If you don’t qualify for scholarships,  it’s easy for a four-year tab to run into six figures. If gas prices rose this quickly, there’d be a move in Congress to tap the strategic petroleum reserve. Remember when students would take jobs and pay for school as they learned? You can’t do that now.

It’s no surprise then that total student debt tops $1 trillion dollars, and that the average grad enters the workforce (if he’s lucky), with $25,000 in debt. College debt is taking a toll on mom and dad too. People over 60 hold $36 billion in college debt. College debt is dogging generations of Americans, with no end in sight.

And, yet mom and dad – even ones who work in finance – can’t even imagine applying a basic financial test to one of their most expensive purchases – return on investment. And, it’s a good thing nobody seems to be holding college administrators to a higher standard because the results aren’t impressive. Richard Arum is a professor at New York University who wrote the book “Academically Adrift,” which documents the erosion of academic standards and performance. He says today’s fulltime college students on average report spending just 27 hours per week on academic activities – less time than a typical high school students spends at school. Average time studying fell from 25 hours per week in 1961 to 20 hours per week in 1981 and 13 hours per week in 2003. Only one in five fulltime college students report devoting more than 20 hours per week to studying.

And instruction? Forget about it. Despite the wave of federal funding, recent government reports show that the percentage of full-time instructional faculty in degree granting institutions declined from 78 percent in 1970 to 52 percent in 2005. On average, faculty spend just 11 hours per week on advising and teaching college students. Only 40 percent of college students are taught by tenured or tenure-track instructors.

So where are the billions of dollars in rising tuition fees ultimately backed by taxpayer dollars going? Education experts say finer gyms, sushi bars and climbing walls suck up an ever increasing amount of higher ed dollars. Richard Vedder, who directs the Center for College Affordability and Productivity and teaches economics at Ohio University, describes the situation as an “academic arms race” with schools spending more and more on infrastructure to attract more students who much spend more money to afford the nicer digs. Says, Vedder, “Even classroom buildings have to have atriums – if not, it’s downscale. “

Another pricey accoutrement are luxury dorms – suites, private bathrooms or baths for no more than four people.” He describes one Ivy league dorm as having  35-foot ceilings in the dining room with triple-leaded glass windows. The cost of this nirvana? $120 million or $350,000 for each of the 350 beds in the building. “It’s crazy,” says Vedder. There are even schools that do laundry for their students or offer valet service for those who need to get to class ASAP. The Harvard campus that Ryan O’Neal and Ali MacGraw floated through in the movie Love Story couldn’t hold a candle to what’s happening on school campus today. Even the non-Ivies are forced to compete.

And, maybe all of this would be okay if students were learning, Arum, says, though on this most important test our nation’s colleges are struggling. The shocking findings of his investigations are these: A third of students gain no measurable skills during four years of college. None. Instead, students and parents alike see the four-year degree as a credential, a qualification or resume line item that they are willing to pay dearly for in return for career legitimacy. But this emperor has no clothes on and today’s parent’s need to understand the limitations of the college degree. In the coming week, we will help you understand the tricks and tips that will allow you to stretch your education dollars, find the institution that is the best match for your child. Our User’s Guide to Education continues all this week. Check this space and Fox Business Network at 6 pm and 9 pm daily to get our exclusive take on education.

 

 

 

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