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Graduation-Wake Up Call



Your Health Depends On It

Don’t let graduation reverie and the excitement of that first teaching job ahead blind you to a very real concern during the hiatus between school and work: health insurance coverage.

Depending on which state you live in, many insurance companies drop dependents from parents’ policies once they cease being full-time students or reach a certain age (usually 22 to 25).

But there’s no need to panic. Soon-to-be college grads have at least three ways to obtain “gap” health insurance.  First, insurance companies specializing in the student market offer extended policies, but they must be purchased before graduation. 

Second, short-term policies are available through major insurers, but generally cost more and are good for only six months to a year. 

The third option is for your parents to continue covering you under their existing health insurance plan through COBRA, the federal law that allows an adult child to remain on a parent’s policy for up to 36 months. It’ll likely provide the most comprehensive coverage, but also the most expensive.

The important thing is to get yourself covered until your new job does it for you!

Wheel-Wise: Buying a Used Car

Okay—you’re in college and you know how to do your homework. Once you’ve figured out what type of used car you want to buy, follow these steps to minimize your risk:

  1. Get recommendations on reputable used car dealers from family and friends. Your local consumer protection agency and Better Business Bureau are also good sources of information.
  2. Make sure the car you want to buy “checks out.”  The dealer should have already verified that the car has a clear title and has not previously sustained serious damage by, for example, collision or flood.  The Federal Trade Commission requires dealers to post a Buyer’s Guide in every used car with important information such as whether the vehicle is being sold “as is” or with a warranty.
  3. If you’re buying a used car from a private individual, you can obtain vehicle history information for a reasonable charge from services like CARFAX (www.carfax.com). All you need to know is the Vehicle Identification Number (VIN).  You can also request to have the car inspected at your own cost prior to purchase, although the seller does not have to comply.

The Fine Print: Cell Phone Contracts

It’s your responsibility to read and fully understand the terms of a wireless calling plan before signing on the dotted line.   Important questions to ask to prevent surprises: 

  • What is the duration of the contract and how do I cancel or renew? A contract may renew automatically unless you contact the company to terminate it at the appointed time.
  • What happens if I cancel my calling plan early? A $100-$200 penalty is not uncommon for early termination.
  • When do “peak” and “off peak” times occur? Consumers pay the highest rates at “peak” times.
  • Does the cellular service have adequate coverage in the area I use the most?  Know what constitutes your “home calling area.”
  • What are “roaming” charges and long distance rates? These are fees for calls made and received outside of your home calling area.
  • What is the bottom-line cost of my first bill? Besides the monthly fee associated with a one- or two-year contract, there will be other costs such as the price of your cell phone, postage and handling charges, an activation fee, and possibly a deposit.

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January, 2007