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Feds break up Chicago’s Head Start monopoly, sparking fresh change



The federal government will break up Chicago’s monopoly on $145 million for Head Start programs — the last “supergrantee” among large cities in the U.S.— and divvy up about $95 million to five community organizations, including one led by former Illinois First Lady Diana Rauner. City Hall will hold on to $51.8 million of the grant.

It remains to be seen whether the change will yield stronger competition, higher quality programs, and more seats for children under 5 in the neighborhoods that need them — or create confusion on the ground.

Chicago’s shrinking oversight role is the second major early learning change under Mayor Lori Lightfoot’s watch and has prompted vast reshuffling of early learning programs. The city will go from managing 40 programs that serve 8,000 children to 14 that enroll fewer than 3,000. Twelve organizations, including the YMCA of Metropolitan Chicago, could lose Head Start funding as of Aug. 1.

Two community organization heads said hundreds of children enrolled in programs that lost funding may need to be enrolled elsewhere, but City Hall officials said it was too soon to confirm that number.

Between children aging out for kindergarten and families moving out of Chicago during the pandemic, the city’s Department of Family and Support Services is still trying to assess the number of children impacted, Commissioner Brandie Knazze told Chalkbeat on Tuesday. She said a transition plan is in the works.

“We are working through understanding what the impact of the changes will be, but there’s no loss to the city of Chicago as a whole,” said Knazze. “This funding is just being redistributed among five grantees, and we are committed to working with them.”

The five new “delegate” agencies say they plan to boost salaries and benefits, do more for parents and grandparents, extend after care and evening programs, and step up marketing and outreach. Enrollment of young children plummeted during the pandemic and not just in the public school system. Across Illinois, only one in five centers was operating at 80% capacity or better toward the end of last year.

“We have a big job around us around reengaging and recruiting new families,” said Claire Dunham, the senior vice president of programs and training at Start Early, one of the five community organizations that received a chunk of the Chicago grant.

Pandemic-related enrollment declines and staffing churn hit Chicago’s early learning system hard, and even then, some programs were struggling. In 2019, the city held a grant competition and, while several new centers picked up public funding, other stalwart community organizations lost out. Some closed classrooms; others closed their programs entirely.

Chicago, meanwhile, was under federal scrutiny after safety problems were reported in centers in 2019 and 2020. The U.S.Department of Health and Human Services said last year that it intended to rebid Chicago’s Head Start grant..

Until this month, Chicago’s City Hall steered the bulk of the federal dollars that flow here for thousands of low-income children, giving the city an advantage when it rolled out universal pre-kindergarten. The grant changes will not impact the universal preschool rollout, now largely being driven by the school district.

Immediately, the changes also will boost the number of seats for low-income infants and toddlers, said Knazze — an outcome advocates had been pushing for as more preschool classrooms opened in public schools.

Under the break-up, six groups including the city will call the shots on early learning, not just one. The fate of the centralized early learning application preschool families are supposed to use as a one-stop shop for applications also remains unclear.

“There are a lot of unknowns currently,” Jennifer Alexander, the mayor’s director of early learning, acknowledged. “But we are continuing to work with our public and private partners to leverage our relationships.”

Program directors say they hope decentralizing administration will boost experimentation and better outcomes for children. At Start Early, one priority will be studying kindergarten transitions and how to boost “kindergarten readiness.” In recent years, new data showed that only one in four Chicago children show up to kindergarten prepared.

Each of the new federal grantees will oversee a small group of partner agencies. Start Early’s roster will include two charter schools that run preschool programs and kindergartens.

Bela Moté, the CEO of the Carole Robertson Center for Learning, said she’ll focus immediately on doing more to boost salary and benefits for educators and help stem the loss of teachers to the public school district, where pay is on a unionized pay scale.

“We together need to work on a better pipeline for the early childhood workforce. A pipeline that is quite dry — and work to really retain staff and compensate them,” said Moté.

Edgar Ramirez, CEO of Chicago Commons, said his organization is thinking through how to boost parent engagement and invest in programs that support multiple generations, such as credit repair and job training support for parents and grandparents. He’s also ramping up programs for pregnant women.

It will take time to assess the impact of the reshuffle, said Ty Jiles, a professor of early childhood education at Chicago State University.

On her list of burning questions are whether programs will still have the money, and flexibility, to offer extended day care for working parents — and after-care for students who attend school-based preschool programs that end around 2:30 in the afternoon. She also wonders how decisions will be made among the new federal grantees, how they plan to coordinate with the city, and whether there will be transparency about decision-making.

Mostly, though, Jiles is thinking about the children who could be impacted if their centers have to close classrooms. “For a high-risk population, it’s another transition.”

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Are Sallie Mae Student Loans Federal or Private?



When you hear the name Sallie Mae, you probably think of student loans. There’s a good reason for that; Sallie Mae has a long history, during which time it has provided both federal and private student loans.

However, as of 2014, all of Sallie Mae’s student loans are private, and its federal loans have been sold to another servicer. Here’s what to know if you have a Sallie Mae loan or are considering taking one out.

What is Sallie Mae?

Sallie Mae is a company that currently offers private student loans. But it has taken a few forms over the years.

In 1972, Congress first created the Student Loan Marketing Association (SLMA) as a private, for-profit corporation. Congress gave SLMA, commonly called “Sallie Mae,” the status of a government-sponsored enterprise (GSE) to support the company in its mission to provide stability and liquidity to the student loan market as a warehouse for student loans.

However, in 2004, the structure and purpose of the company began to change. SLMA dissolved in late December of that year, and the SLM Corporation, or “Sallie Mae,” was formed in its place as a fully private-sector company without GSE status.

In 2014, the company underwent another big adjustment when Sallie Mae split to form Navient and Sallie Mae. Navient is a federal student loan servicer that manages existing student loan accounts. Meanwhile, Sallie Mae continues to offer private student loans and other financial products to consumers. If you took out a student loan with Sallie Mae prior to 2014, there’s a chance that it was a federal student loan under the now-defunct Federal Family Education Loan Program (FFELP).

At present, Sallie Mae owns 1.4 percent of student loans in the United States. In addition to private student loans, the bank also offers credit cards, personal loans and savings accounts to its customers, many of whom are college students.

What is the difference between private and federal student loans?

When you’re seeking financing to pay for college, you’ll have a big choice to make: federal versus private student loans. Both types of loans offer some benefits and drawbacks.

Federal student loans are educational loans that come from the U.S. government. Under the William D. Ford Federal Direct Loan Program, there are four types of federal student loans available to qualified borrowers.

With federal student loans, you typically do not need a co-signer or even a credit check. The loans also come with numerous benefits, such as the ability to adjust your repayment plan based on your income. You may also be able to pause payments with a forbearance or deferment and perhaps even qualify for some level of student loan forgiveness.

On the negative side, most federal student loans feature borrowing limits, so you might need to find supplemental funding or scholarships if your educational costs exceed federal loan maximums.

Private student loans are educational loans you can access from private lenders, such as banks, credit unions and online lenders. On the plus side, private student loans often feature higher loan amounts than you can access through federal funding. And if you or your co-signer has excellent credit, you may be able to secure a competitive interest rate as well.

As for drawbacks, private student loans don’t offer the valuable benefits that federal student borrowers can enjoy. You may also face higher interest rates or have a harder time qualifying for financing if you have bad credit.

Are Sallie Mae loans better than federal student loans?

In general, federal loans are the best first choice for student borrowers. Federal student loans offer numerous benefits that private loans do not. You’ll generally want to complete the Free Application for Federal Student Aid (FAFSA) and review federal funding options before applying for any type of private student loan — Sallie Mae loans included.

However, private student loans, like those offered by Sallie Mae, do have their place. In some cases, federal student aid, grants, scholarships, work-study programs and savings might not be enough to cover educational expenses. In these situations, private student loans may provide you with another way to pay for college.

If you do need to take out private student loans, Sallie Mae is a lender worth considering. It offers loans for a variety of needs, including undergrad, MBA school, medical school, dental school and law school. Its loans also feature 100 percent coverage, so you can find funding for all of your certified school expenses.

With that said, it’s always best to compare a few lenders before committing. All lenders evaluate income and credit score differently, so it’s possible that another lender could give you lower interest rates or more favorable terms.

The bottom line

Sallie Mae may be a good choice if you’re in the market for private student loans and other financial products. Just be sure to do your research upfront, as you should before you take out any form of financing. Comparing multiple offers always gives you the best chance of saving money.

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Tips to do some fall cleaning on your finances



Wealth manager, Harry Abrahamsen, has five simple ways to stay on top of the big financial picture.

PORTLAND, Maine — Keeping track of our financial stability is something we can all do, whether we have IRAs or 401ks or just a checking account. Harry J. Abrahamsen is the Founder of Abrahamsen Financial Group. He works with clients to create and grow their own wealth. Abrahamsen shares five financial tips, starting with knowing what you have. 

1. Analyze Your Finances Quarterly or Biannually

You want to make sure that your long-term strategy is congruent with your short-term strategy. If the short-term is not working out, you may need to adjust what you are doing to make sure your outcome produces the desired results you are looking to accomplish. It is just like setting sail on a voyage across the Atlantic Ocean. You know where you want to go and plot your course, but there are many factors that need to be considered to actually get you across and across safely. Your finances behave the exact same way. Check your current situation and make sure you are taking into consideration all of the various wealth-eroding factors that can take you completely off course.

With interest rates very low, now might be a good time to consider refinancing student loans or mortgages, or consolidating credit card debt. However, do so only if you need to or if you can create a positive cash flow. To ensure that you are saving the most by doing so, you must look at current payments, excluding taxes and insurance costs. This way you can do an apples-to-apples comparison.

The most important things to look for when reviewing your credit report is accuracy. Make sure the reporting agencies are reporting things actuary. If it doesn’t appear to be reporting correct and accurate information, you should consult with a reputable credit repair company to help you fix the incorrect information.

4. Savings and Retirement Accounts

The most important thing to consider when reviewing your savings and retirement accounts is to make sure the strategies match your short-term and long-term investment objectives. All too often people end up making decisions one at a time, at different times in their lives, with different people, under different circumstances. Having a sound strategy in place will allow you to view your finances with a macro-economic lens vs a micro-economic view. Stay the course and adjust accordingly from a risk and tax standpoint.

RELATED: Financial lessons learned through the pandemic

A great tip for lowering utility bills or car insurance premiums: Simply ask! There may be things you are not aware of that could save you hundreds of dollars every month. You just need to call all of the companies that you do business with to find out about cost-cutting strategies. 

RELATED: Overcome your fear of finances

To learn more about Abrahamsen Financial, click here

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How to Get a Loan Even with Bad Credit



Sana pwedeng mabura ang bad credit history as quickly and easily as paying off your utility bills, ‘no? Unfortunately, it takes time. And bago mo pa maayos ang bad credit mo, more often than not, kailangan mo na namang mag-avail ng panibagong loan. 

Good thing you can still get a loan even with bad credit, kahit na medyo limited ang options. How do you get a loan if you have bad credit? Alamin sa short guide na ito. 

For more finance tips, visit Moneymax.



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