Stomping the Yard: A Lesson on Finances
After meeting with my relative about going away to college, I knew it was time to pen this piece. As we talked about his plans to go off to college and his necessities such as purchasing a car, obtaining a part-time job and what he needs to know about student loans, the puzzled stare on his face made me realized he had so much to learn.
The educator in me wanted to make sure he made the right choices for college and wise financial decisions. I am a huge advocate of personal finance and I, too have made many bad financial decisions in college.
If only my college degree came with instructions about what I should set aside for retirement upon starting my first job.
If only my college experience would have gone beyond traditional electives that I would more than likely never use in my life, but teach me about personal finance concepts that I would need to know from day one in college.
If only someone would have told me the simple things about the “ins and outs” of managing my money.
Please don’t get me wrong, I am not knocking my college degree or experience. It is because of that experience I am the woman I am today! But what better place to learn about the real cost of those frightening student loans? or any other money-related question for that matter.
Research shows that many individuals lack the basic understanding of personal finances. Because of their lack of knowledge, they are less likely to invest in the stock market and more likely to take on overwhelming debt. Simply put, a lack of understanding of how to make your money work could result in you building less wealth over time.
So what do you do when you want to learn more about money, but your college offers limited resources? Here are 3 tips to point you in the right direction.
1. Get organized.
First, realize one thing: the choices you make today concerning your finances will impact your financial future in so many ways! A great way to conquer your finances is simply to get organized. I often share my financial planner with those who are looking to get organized. It is a great place to start with creating a simple budget, getting a handle on your bills and simply understanding where you stand financially. More importantly, it will get you in the mindset to create a system for your finances well into the later years of your life.
2. Know before you borrow.
Before committing to any student loan, get an idea of what you can expect to earn when selecting a major. And while you should consider more than your earning potential when choosing a profession, it is important to get an understanding of what you can expect to earn. This way you can determine what is a reasonable amount to borrow before committing to any student loan.
Do your homework. Get an understanding of what amount you will be responsible to pay back upon graduating. Lastly, before borrowing consider other resources as well. There are many scholarships that are available with many ready to shove out the dough. See if you qualify for free money that you can use toward your college costs.
3. Become financially literate.
Finally, learn as much as you can as it relates to your finances. There are tons of resources geared toward helping college students learn about their finances. If you have questions about how to conquer a budget, what it takes to boost your credit score or simply how much money should you set aside check out kemberley.com to become financially literate!
Kemberley Washington, CPA is a professor at Dillard University and the co-founder of the B.A.D.G.E. plan. She is also the author of “The Ten Commandments of Financial Healing.” For more on Kemberley and her work, visit www.kemberley.com.