Since I will be graduating college next semester, I have been really focused on creating a plan both financially and for my career. When I graduate, I would like to be in the live entertainment industry but since you have to work from the bottom up, working low-paid jobs, I need to be more realistic with my plans. With that, I want to stay in Pittsburgh for at least one year then move to Nashville, Tennessee for their music dynamic that has been vastly growing. But, since the jobs in the industry are very hard to get, I focused on what it would be like as a relator in Nashville. I know that getting my realtors license, I can always find a market to work in and sell homes, like a back-pocket plan. I believe that working in this field temporarily will be most profitable and sounds the most appealing to me. I have always had a passion for real estate and music, finding a career in either of those industries will be great. Though, it is extremely important to consider all potential options of careers and their advantages and disadvantages.
As I continue to look at being a relator, my annual salary would be $50,000 before taxes are taken out and expenses have been paid. I grew up around real estate agents and agencies, which played a huge factor in my interest in real estate. I believe this is great starting out, fresh out of college, considering I will be providing for myself and not depending on my parents. I am hesitant to apply for a job and schooling for a real estate agent’s licenses, just in case another opportunity arises in my degree that I would not want to pass up. But, focusing again on real estate, you work with a company, you gain clients and you make commission off of sales of homes, apartments, offices and more.
My goal with working in this career is that if I ever relocate I know that I can carry my license with me and find a job in any state. Same idea with the music industry, there are concert venues and music careers located all around the world. I just want to be financially stable first and foremost. Ultimately, with the budgeting and planning strategies I have learned, I think I will achieve all of this in a timely manner.
Personal Life Map Portfolio Results:
Tools for Financial Planning-Budgeting:
The one thing from this course that I will be forever grateful of learning is how to budget my finances. I often see how easily people enter debt and financial crises, I personally never want to enter that phase in life. It is very important that I maintain a budget while planning out the rest of my life. I never realized how much I spend on a weekly basis and utilizing budgeting apps on my phone, like the app Mint, has really helped me focus more on what is important to spend on rather than leisurely spending. I need to save money to rent an apartment in Nashville for when I move out of my parent’s house, add in the repayment plan for my loans, getting my driver’s license and insurance for that, mainly anything that I will be spending money on.
Something that I learned and what I think other students would benefit from is tracking your current monthly budget as well as your future budget. It helps you stay consistent and will help you save your money. I would also say that recapping weekly, your receipts and expenses, will benefit you in the long run because you become more aware on what you are spending and what you could probably give up, for me it would be my Starbucks and Hello Bistro trips.
This is by far the most relevant section to learn in college because it is already hard enough to support yourself while being a full-time student and it teaches discipline. No more spending a ton of money on treats and nightlife college students unless you can budget it all correctly.
Managing Your Liquidity
I know going into this course I was clueless on managing my liquidity. Liquidity means assets are extremely easy to convert to cash and can be used for consumption making this topic very important because it will help you learn the necessities of these goals and when it will become accessible. I have to make sure that I have a sufficient amount of funds in my checking and savings accounts in case an emergency situation arises. I also believe liquidity plays a huge role in budgeting and should be managed just as much as your monthly budget. What I need to do during my first year after college is to see how liquid my financial goals are with my student loans and buying an apartment. I am going to need money to fulfill these goals and securing that I have that in my account and that I have access to it, helping me achieve these goals.
Something that students can take away from this lesson is always have enough funds for when any kind of situation arises unexpectedly. This is very relevant because many students like myself are paying their own expenses and we need to make sure we have all of the funds necessary to make great financial decisions. Honestly, everyone should know what liquidity is just so that they are financially safe and have leeway with their finances.
Personal Financing-Credit Management
For the next lesson, I learned about credit management. I think it was beneficial using the personal life map portfolio and the credit card assignment to acknowledge my ideal credit limit, score, and what is the best credit card for me to have considering my finances. Credit cards are an easy way to make payments but could also increase a person’s debt. Many people sign up for credit cards without realizing interest rates, payment processes, limits, and put themselves in debt. I am genuinely afraid to make large payments with a credit card in fear of accumulating interest and not being able to pay off the bill in a timely manner, hence why I do not currently have a credit card. I think a credit card would be great for emergency payment situations but I will only get one that fits my spending and what I know will be a safe option for me.
My monthly credit limit is roughly $500 and I chose this amount because I know I cannot spend above what I can actually afford and this will help me build an excellent credit score. Making payments on time or before they are due will also benefit me greatly while owning a credit card, I do not want to have a bad credit score. I do have a debit card and I find that more liquid than a credit card making me more comfortable using that instead. I would rather a one and done payment, I do not like having to owe anyone anything.
Based off of my research on these institutions, I ended up at PNC Bank, which is what I have now. I think the fact that I have had this bank for a while, I am use to their terms. For now, since I will be in Pittsburgh for at least a year, the location and fees are extremely convenient and affordable. I trust PNC Bank compared to other banks but I would like to note that since reading about the savings and credit union, I feel like I need to invest in one of those. Due to the annual fee, interest rates on purchases, credit limit and cash advances along with many other factors I want to keep all of my options open after I graduate. I like having great benefits and I believe this card is perfect for that. Which leads me to the advice I would tell students, watch your credit limit and build your credit score to an excellent standing point. A huge issue with credit cards is the ease of spending on credit and saying you’ll pay it later. That leads to a major debt issue because you accrued more than you can afford. Also, advice I shared with my roommate was to do research on credit cards and do not settle for just any. Make sure it suits your spending and needs. Read the contract, compare rates and fees to find that card that is the best fit for you and that you know you can pay back in a timely manner.
This topic is one of the most relevant to students because many students just spend money without realizing what happens after you cannot afford those payments. It is important to know the process and do not sign up for a credit card without fulling understanding everything about the credit card and its terms. Something every college student should know and if they do not, they should be educated on.
Protecting Your Wealth-Insurance
Insurance is one of the most important aspects of life and finances. There are many types of insurance like health, renter’s, auto, homeowner’s, dental, life, vision and many more. I can honestly say that the only insurance I really knew anything about was health insurance and that it was through my parents. There have been many times in my life that I did not have any insurance and that is very scary. It is extremely important to have that because not having insurance and a situation arises and you cannot afford it, you are extremely out of luck. Since I do not have a car right now, car insurance is not my priority and neither is renter’s and homeowner’s considering I will be home for a year. But still understanding the concept is very important in life and finances.
There are many plans in my life for all types of insurance but I know for a fact that I want to invest in my life insurance because I do not want my parents or beneficiaries to have to pay for anything after I die, especially when it comes to my student debt. I want to look more into life insurance after I graduate and I am set on health insurance right now because I am on my parents plan. A big focus on purchasing insurance is to find a low deductible and what covers more damages even if there is a higher monthly premium.
As far as advice, I would say look into life insurance because life works in mysterious ways and we all hope to live long but sometimes that is not the case. Also, there are so many insurance companies out there and it is important to do your research, you do not want to settle for the first option you find, look for insurance that suits you personally. Also, like credit cards, read the fine print. Find out what is specifically covered, what the plan is because you do not want to agree to something that you are not fully aware of what you are signing up for.
This topic is quite relevant for college students because once you do not live with your parents anymore, or you are venturing out on your own, there are many things that will need to be covered. You do not want to lose belongings, get injured and not be able to afford it, or just not have coverage. One thing that worries me is if I were to pass away and the payment falls on my parents, that will put them in extreme debt, I would rather everything be covered. I feel very educated on this topic now, I feel comfortable talking about it and I hope other students can also feel that way.
Personal Investing and Retirement
I really enjoyed learning about personal investing and retirement because I see how my family members are either retired or are depending on social security and I want to be sure I will be set with money when I hit the age of retirement and essentially have zero worries. I also have a great interest in investing in stocks, that is something I want to master in life because it plays a crucial part in having money as we age. I want to invest in companies and funds that I know will accumulate the right amount of money for my goals in finances.
When it comes to investing I am moderate with my spending where my risk tolerance is not extremely high but it is in a comfortable spot. I plan to save roughly $10,000 to help with my savings and help me afford an apartment in Nashville as well as possibly a car, once I get my license, within the next few years after I graduate. I also want to put money away monthly for my retirement. Obviously I am twenty-two years old and am nowhere near retiring but it is important to start saving now so that I can live a comfortable life when I get older. I want to master my investing strategy and make sure I am constantly checking on my savings and investments. I just fear losing money and not increasing my rate of return when I do invest and hopefully gain money.
A piece of advice that I could give students is to invest and save as early as possible. It is truly not unrealistic to do this and it will benefit them in the long run. It will be a great feeling knowing we will be financially successful. Even just investing a small amount between $50 to $100, it is not a huge amount and it is a start. I also think students should take advantage of the resources out there like Professor Diehl and many financial advisors out there to ensure a success in their financial goals. To reiterate, invest early and accumulate interest. It is a lesson that everyone should learn as soon as possible.
Reflections:
This course has impacted my life in a major way because I was terrified of my finances. I feel much more comfortable budgeting, setting goals, knowing what I am buying or investing in and more. I learned that currently I am not great with money but now that I know strategies, I am more confident in having a successful financial outcome in the future. I now take my budget very seriously and try to be more responsible and accountable with my spending. I genuinely believe that I thought I would be fine in life but I never considered everything that I now know from this course like insurance, liquidity, credit cards, investing, and retirement. The one lesson that really stays with me from the course is the student loan repayment. I feel less anxious about paying it off because I understand it. Prior to this course, I would look at my loans and cry and not look into them. That has completely changed because I know there is a repayment plan for me and I know I will be able to pay this off when I get a job after graduation.
The course itself should be taught to every single student in college because of how important and beneficial it truly is. The assignments were very helpful, at times extremely confusing, but that is all a part of the learning process. I think I would have benefited from feedback on assignments knowing that I was following a good plan and not being unrealistic with myself. This course has so much information and that can be overwhelming. I also think if it was possible, meeting with Professor Diehl and discussing our budgets and goals to know we are on the right track would have been very beneficial. Lastly, I would say that Professor Diehl is an great professor and advisor on this subject because of his honesty on the subject and resourcefulness. I felt like I could relate to this course no matter where I am at financially, my understanding has improved greatly. Everyone needs to take this course at least once in their lifetime, the sooner, the better.