Sweet Forgiveness

If you received aid through the Federal Perkins Loan Program, you may qualify to cancel up to 100 percent of your loan. But you must work full-time in a public or nonprofit school system as a

• teacher in a school serving students from low-income families,
• special education teacher, or
• teacher in mathematics, science, foreign language, bilingual education, or
  other field your state determines has a shortage of qualified educators.

If you received a Stafford Loan on or after October 1, 1998, and teach full-time for five consecutive years in a designated low-income school, you also might be able to have up to $5,000 of the loan forgiven. This applies to FFEL Stafford Loans, Direct Subsidized and Unsubsidized Loans, and, in some cases, consolidation loans.

Check with your university financial aid office or visit http://studentaid.ed.gov to learn more.

Ready to retire?

You may not be teaching yet, but it's never too soon to prepare for the far side of your career: retirement. Depending on where you work, you likely will participate in either a 403 (b), 403 (b)(7), or 457 retirement savings plan. Each plan is a tax-deferred account, a contract under which you make periodic contributions (usually from each paycheck) through your employer to a company that invests the funds. Your objective? Build as much retirement income as possible in the account in exchange for your investment.

If you start investing in your 20s, you could accumulate a substantial sum by retirement age through the discipline of regular contributions and the beauty of compounding interest. If you invest $2,000 annually for the next 35 years and the retirement plan earns 8 percent every year (annualized), then you will accumulate $344,634. That's pretty impressive given you would have invested only $70,000 during that time!

So don't wait. Talk with a qualified retirement specialist as soon as you start pulling down that long-awaited paycheck, and lock in your future financial security.

What's your life worth?

None of us likes to think about what would happen if we died unexpectedly, but planning ahead can provide you—and your family—with peace of mind. And that means getting life insurance. But how much and what kind?

First, see if you get life insurance as a benefit of employment. Employers often provide a set amount or one to two times your annual salary in life insurance as part of your compensation.

Second, determine if this amount of life insurance meets your needs. If you're single and have no dependents (and you don't own any property other than a vehicle), then you probably do not need additional coverage.

If you own property and/or have dependents, though, or your employer doesn't provide any coverage, you definitely should consider purchasing it. Term insurance, where you purchase a policy with a specific benefit amount for a specific time period, is usually the most economical type. A good rule of thumb for most consumers: obtain enough life insurance to equal approximately six times your annual salary.