Road to Financial Wellness

Jason Vitug@jasonvitug

Road to Financial Wellness and Success in College

College Bound

At the age of 18, you are now prime

targets for creditors and lenders.

Why Financial Education?

• We learn the area of a triangle but not the value of the dollar.

• We can calculate the circumference of a circle but not the power of compounding interest.

• Money is a taboo subject but we learn our financial habits through family and social interactions.

• Tremendous amount of information leading to confusion

• Knowledge over finances means greater control.

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What we hear about money?

Why Financial Education For You?

• American consumers owe:– $854.2 billion in credit card debt

– $1.12 trillion in student loans

• Consumers paid $32 billion in overdraft fees

• 70 million Americans are “underbanked”

• Financial relationships, credit reports and credit scores impact your well being.

Education empowers you to make better informed financial decisions.

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Understanding Money Basics for Teens

• Pay yourself first.

• Don’t spend money you don’t have.

• Avoid paying for unnecessary fees like ATM surcharges or overdraft fees.

• Credit is not the problem but it leads to debt. Debt is the ball-and-chain preventing you from living YOLO.

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You Only Live Once

• YOLO is knowing the value of your time to create experiences and memories.– Spend what you make only leads you to “living at the

workplace” more often than you need.

– If you only live once, why not spend it doing the things you want to do all the time rather than just the weekends?

• YOLO is using knowledge, resources and time to achieve desired lifestyle in this lifetime. – You can spend your days/nights working to pay for a

lifestyle you can’t afford.

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Wealth is not measured by how

much you spend but how much you’ve

saved.

At age 23, you made $40,000/year and by 30 years old you’ve saved $40,000 into your 401(k). If you decided not to contribute another dime till retirement and realizing an 8% return, your $40,000 would be

over $600,000.

Thoughts on Financing

• Purchase on credit only when buying long lasting assets with short lasting financing.

• Don’t finance items for longer than their usable life.• The importance of credit and impact to lifestyle.• Necessity of loans as an investment (education, home,

car).• Just because you’re approved doesn’t mean you can

afford it.• Ask yourself, “How does the loan or line of credit

improve your life long term?”

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Debt is reserving your future time to

work rather than fun.

Establishing Your Credit

• The sooner you establish your credit the stronger your credit score may be in the future.

• Establish credit through a secured credit card offered by a bank or credit union.

• Get added to a parent’s existing credit card. • Pay the amount in full each month.• Note: As a full-time college student, you cannot get

approved for an unsecured credit card under the age of 21 unless you can prove you’re working and can repay.

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Paying for College

1. College Savings Funds

2. Federal and State Grants

3. Scholarships

4. Federal Loans

5. Work-Study Programs

6. Private Student Loans

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Find Scholarships

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+ Fastweb (http://www.fastweb.com/college-scholarships) – Search a database of more than 1.5 million scholarships.+ NerdWallet (http://www.nerdwallet.com/nerdscholar/scholarships/) – Search scholarships from over 10,000 financial aid programs.+ CareerOneStop – Search scholarships through the website that is sponsored by the US Department of Labor.+ Chegg Scholarships (http://www.chegg.com/scholarships) – A college portal website that allows students to create profiles and connect with other students and learn more about colleges and search for scholarships.+ StudentScholarshipSearch (http://www.studentscholarshipsearch.com/) –Provided by Edvisors network to help students search, investigate and apply for scholarships.+ Your parents’ employers. Inquire about scholarships offered through their jobs.+ Call your credit union and inquire about college scholarships. Many credit unions offer scholarships to members or children of members.

Ways to Save in College

1. Buy your textbooks secondhand or rent your books. (www.campusbooks.com)

2. Use your student discounts. College students can get discounts from retailers, restaurants and theaters.

3. Graduating on time.

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Financial Aid and College Resources

Phroogal

1. College and Student Resource Center

2. Planning for College

3. Financial Aid Center

4. Find Scholarships

5. Student Loans

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Additional Reading Material

Phroogal – The Smile Lifestyle Blog1. My Financial Mistakes Made in College2. How To Save Money When You’re A Student3. 4 Ways To Be Financially Proactive In School4. How To Save Money On College Textbooks5. 7 Things You Wish You Could Tell Your 21 Year

Old Self6. 6 Ways To Save Money In College And Still Have

Fun

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