Holly Altman Director of Alumni Affairs AHSC Room 2125 (520) 626-9423 haltman@email.arizona

1. Holly AltmanDirector of Alumni AffairsAHSC Room 2125(520) 626-9423haltman@email.arizona.edu The mission of the Office of Alumni Affairs is to connect, celebrateandinspire University of Arizona College of Medicine alumni.

3. Arizona’s First University. College of Medicine Financial Aid

4. Get Organized Organize Your PortfolioAAMC.org/first

5. https://www.aamc.org/services/first • AAMC

6. Interest Rates Interest Rates

7. During Medical School • Refer to page 12 DIRECT PLUS LOAN Interest Rates (before ’13-’14) 7.9% STAFFORD LOAN FIXED 6.8% PERKINS LOAN* FIXED 5.0% FIXED * PCL Loans and LDS Loans are also at a fixed 5%

8. During Medical School • Refer to page 12 DIRECT PLUS LOAN Interest Rates (’13-’14 loans) PERKINS LOAN* 6.41% STAFFORD LOAN 5.0% FIXED 5.41% FIXED FIXED * PCL Loans and LDS Loans are also at a fixed 5%

9. Forgiveness Loan Forgiveness Programs

10. Loan Repayment/Forgiveness and Scholarship Program • Loan Repayment/Forgiveness and Scholarship Programs

11. Arizona Loan Repayment Program • Arizona Loan Repayment Program • The Arizona Loan Repayment Programs (ALRP) are administered by the Arizona Department of Health Services (ADHS), Bureau of Health Systems Development (BHSD) also known as the Primary Care Office for the State of Arizona. • ALRP has two components: the Primary Care Provider Loan Repayment Program (PCPLRP) and the Rural Private Primary Care Provider Loan Repayment Program (RPPCPLRP). • NOTE:Loan repayment is in addition to a compensation package provided by the service site and is considered tax-exempt.

12. Other Loan Forgiveness for Service Programs • National Health Service Corp • Loan Repayment Program Primary Care Physicians • Typically application cycle opens in spring (February) for the following year • You select site (they don’t assign you) • Levels of Funding based upon HPSA score • 14 or above up to $60,000 for 2 years of commitment • 13 or below up to $40,000 for 2 years of commitment • Non Taxable • NHSC Sites

13. Other Loan Forgiveness for Service Programs • Indian Health Service • Loan Repayment Program (LRP) • After Residency • Application cycle opened year-round beginning October 1 through the Friday of the second full week of August. • LRP will assist in matching you to an IHS-approved site. • Do not have to be American Indian or Alaska Native to receive LRP awards • Levels of Funding • Up to $20, 000 per year in exchange for minimum of 2 year service obligation, plus 20 percent of federal income tax on the award. LRP will withhold the employee’s portion of FICA taxes.

14. National Institute of Health Loan Repayment Programs • National Institute of Health Loan Repayment Program • You do the research. NIH will repay your student loans. That is the idea behind the National Institutes of Health Loan Repayment Programs (LRPs). NIH wants to encourage outstanding health professionals to pursue careers in biomedical, behavioral, social, and clinical research. If you commit at least two years to conducting qualified research funded by a domestic nonprofit organization or U.S. federal, state, or local government entity, NIH may repay up to $35,000 of your qualified student loan debt per year. If you are or will be conducting qualified research funded by a domestic nonprofit institution outside NIH, you may be eligible for one of the five extramural LRPs: • Clinical Research • Pediatric Research • Health Disparities Research • Contraception and Infertility Research • Clinical Research for Individuals from Disadvantaged Backgrounds

15. Public Service Loan Forgiveness • Public Service Loan Forgiveness • Make 120 payments to Direct Loans (FFEL Loans will not Qualify for PSLF) • Must work 10 years in Public Service • Does not have to be continuous work • Payments made after October 1, 2007 • What is considered Public Service • Non-profit, tax exempt, 501(c)(3) organizations. Many teaching hospitals qualify ask your residency coordinator • Federal, state or local government • Military service • Public schools and Colleges • One Servicer Public Service Loan Forgiveness: • Fed Loan Servicing

16. Public Service Loan Forgiveness • If Loans aren’t “Direct” Loans, you may consolidate your loans into the Direct Consolidation Loan Program.

17. Consolidation Loan Consolidation

18. Consolidation • Consolidation is the combining of one or more of your existing loans into a new loan. (The consolidation loan pays off the underlying loan) • Consolidation Cons: • Lose out on Grace Period (but you may always apply for Public Service Loan Forgiveness, Pay as You Earn or Forbearance) • Lose Borrower benefits that may have been associated with your previous loans. • Consolidation Pros: • Ease and simplicity during residency have a single loan servicer for all of your eligible federal educational loans • Take Advantage of Public Service Loan Forgiveness • PAYE

19. Postponement Options Postponement Options Forbearance and Deferment

20. Postponement Options Forebearance • Forbearance • Used to postpone payments • Request annually from lender/servicer • Interest accumulates on subsidized and unsubsidized loans • All medical residents are eligible for this • Does not impact your credit score • Capitalization How often? • Evaluate over-all cost to you • Page 27 illustrates Forbearance during residency Assumes 175k in principal during medical school with Sub Loans during first two years.

21. Postponement Options-Deferments • Deferments • Suspends payments for a period of time • Subsidized Loans retain subsidy • Must apply and meet criteria established • For a complete list and details contact your servicer • Types of Deferments: • Graduate fellowship deferment • In-school deferment • Military deferment • Post active duty deferment • Unemployment deferment

22. Repayment Plans Repayment Plans

24. Income Based Repayment and Pay as You Earn Income Based Repayment Pay As you Earn

25. Which Repayment Program Pay As You Earn • Pay As You Earn: (Also Called PAYE) • Do you qualify? • Did you have debt prior to 10/1/2007 (academic year 2007-2008) • If Yes, then you don’t qualify for PAYE, • IF NO then • Did you receive a disbursement after 10/1/2011 (academic year 2010-2011) • Based on your 2013 Income or 2014 Pay-stubs • If you can answer correctly to both these questions, then you may apply for the Pay as You Earn Repayment Program. If not, then you may attempt to repay through IBR. • Important point, only Direct Loans qualify for Pay as You Earn Repayment program • Qualifies for Public Service Loan Forgiveness • Payment capped at 10% of discretionary income

26. Which Repayment Program? IBR • Income Based Repayment (IBR) • Based on your 2013 Income or 2014 Pay-stubs • Both FFEL Loans and Direct Loans are qualified Loan types for IBR repayment program • Qualifies for Public Service Loan Forgiveness • Caps your payment at 15% of discretionary income

27. Compare IBR and PAYE • Both IBR and Pay As You Earn require that you demonstrate a Partial Financial Hardship to qualify for entrance into the program. • A Partial Financial Hardship exists when the annual amount due on all of a borrower’s eligible loans, as calculated under a standard 10-year repayment plan, exceeds 10 or 15 percent of “discretionary income” • Discretionary Income: Discretionary income is defined to be the adjusted gross income minus the federal poverty line that corresponds to your family size and the state in which you reside. (example 1 in in HH) based on 2013 regs. • 3 year partial interest subsidy • Payment adjusts annually • Typically Capitalization occurs when you enter repayment. • In IBR capitalization will occur again either when PFH ceases or when you leave the IBR program. • PAYE the amount of unpaid interest that willcapitalize under the PAYE plan is limited to 10% of the principal amount borrowed when entering into this plan. While in this plan, once the maximum amount has capitalized,interest will continue to accrue but will not be capitalized. • Submit your documents on time!!

28. Married Students with Debt • Lenders will factor in both spouses’ federal loan debt-and their joint income-when calculating payments. Each spouse’s payment will be proportional to their debt amount.

29. Federal Student Loan Ombudsman Resolving Processing Issues • Federal Student Loan Ombudsman • https://studentaid.ed.gov/repay-loans/disputes/prepare/contact-ombudsman

30. Taxpayer Relief Act of 1997 Limited to first 60-months of repayment Student loan interest deduction max $2,500 per year Voluntary payments & capitalization may be eligible Refer to page 46 www.irs.gov/publications/p970

31. Resources

32. Starting a New Job To receive a paycheck, an employee must: • Complete a Form W-4 • Employee’s Withholding Allowance Certificate • Complete a Form I-9 • Employment Eligibility Verification

33. Form W-4 Employee’s Withholding Allowance Certificate • Determines the percentage of gross pay which will be withheld for taxes • Allowances • Used to determine the amount of federal taxes withheld from the paycheck • A person may claim a personal allowance if no one else claims the person as a dependent • Dependent – a person who relies on the taxpayer for financial support

34. Steps to Completing a Form W-4 • Print or type legal name on Line 1 and home address directly below the name • Write Social Security number on Line 2 • On Line 3, check the appropriate box to indicate marital status • Enter a zero on Line 5 if not claiming any allowances • Sign name and date the form before giving it to the employer • Keep a copy for personal records

35. Form I-9 Employment Eligibility Verification Form • Used to verify the eligibility of individuals to avoid hiring undocumented workers or others who are not eligible to work in the United States • Must provide documentation which establishes identity and employment eligibility • Examples include driver’s license, Passport, Social Security card, and birth certificate

36. Family Economics & Financial Education Reading a Paycheck

37. Paycheck Stub Paycheck Stub • A document included each pay period which outlines paycheck deductions

38. Personal Information • Personal Information • States the employee’s full name, address, and Social Security or Employee Identification number • Always check to ensure this information is correct

39. Pay Period • Pay Period • The length of time for which an employee’s wages are calculated; most are weekly, bi-weekly, twice a month, or monthly • The last day of the pay period is not always payday to allow a business to accurately compute wages

40. Gross Pay • Gross Pay • The total amount of money earned during a pay period before deductions • This is calculated by multiplying the number of hours worked by the hourly rate • If a person is on salary, it is the total salary amount divided by the specified number of pay periods

41. Net Pay • Net Pay • The amount of money left after all deductions have been withheld from the gross pay earned in the pay period

42. Deductions • Deductions • The amount of money subtracted from the gross pay earned for mandatory systematic taxes, employee sponsored medical benefits, and/or retirement benefits

43. Federal Withholding Tax • Federal Withholding Tax • The amount required by law for employers to withhold from earned wages to pay taxes • The amount of money deducted depends on the amount earned and information provided on the Form W-4 • Largest deduction withheld from an employee’s gross income

44. State Withholding Tax • State Withholding Tax • The percentage deducted from an individual’s paycheck to assist in funding government agencies within the state • The percentage deducted depends on the amount of gross pay earned

45. FICA (Federal Insurance Contribution Act) • FICA • This tax includes two separate taxes: Fed OASDI/EE or Social Security and Fed MED/EE or Medicare • These two taxes can be combined as one line item or itemized separately on a paycheck stub

46. Social Security • Social Security • Nation’s retirement program, helps provide retirement income for elderly and pays disability benefits • Based upon a percentage (6.2%) of gross income, employer matches the contribution made by the employee

47. Medicare • Medicare • Nation’s health care program for the elderly and disabled, provides hospital and medical insurance to those who qualify • Based upon a percentage (1.45%) of gross income

48. Medical • Medical • The amount taken from the employee’s paycheck for medical benefits • Occurs when the employer has a medical plan for employees but does not pay full coverage for his/her benefits

49. Retirement Plan • Retirement Plan • The amount an employee contributes each pay period to a retirement plan • A specified percentage of the contribution is often matched by the employer • May be a 401K, a state, or local retirement plan

50. Year-to-Date • Year-to-Date • Total of all of the deductions which have been withheld from an individual’s paycheck from January 1 to the last day of the pay period indicated on the paycheck stub