Tips for finance and self investment

 

Wojcik

Ever since I have acquired my position as the Royal Purple Business Editor, I have had a desire to enlighten students about money management and present opportunities to clarify misperceptions about finance.

I want the business section to focus on the accomplishments of our business students, but also to inform our students who might not have any knowledge regarding finance.

This is quite difficult, since I am beginning to learn about the financial world, so I decided to do some research to educate myself.

I thought Liz Weston’s “The 10 Commandments of Money: Survive and Thrive in the New Economy” would be worth noting.

Weston’s first commandment is “create a budget that works in the real world.”  Earlier this semester, we published a story called “Budget 101” that had the same basic principles that Weston describes.

To write a budget, one would gather up all the money they earn, pay stubs or cash earned-and then track their monthly bill and expenditures.

They also would have to account for their savings-college, retirement, or emergency funds-and then establish a budget that allows for all these costs to coexist.

Weston suggests to follow the 50/30/20 budget created by Harvard bankruptcy professor Elizabeth Warren.  It advises that “must have” expenses never exceed 50 percent of your paycheck.

The 30 percent of your paycheck goes toward costs associated with “wants,” and the last 20 percent goes to either debt or savings payments.

Being college students, we all live paycheck to paycheck, and this is a fantastic way to split those paychecks.

Weston’s third commandment is “pay off debt the smart way,” which I think is a necessary topic when it comes to college students.  Most students have accumulated loans from attaining their college education.

Weston notes that federal and private student loans are different.  Both are beneficial to one’s future; however, private student loans usually have higher interest rates.

Federal student loans have a limit that students can receive.

Private student loans have no such limit, making it easy to acquire a great deal of unpayable debt.

Weston suggests students choose the longest payment plan for federal loans because of possible financial setbacks and lower monthly payments.

Weston notes that those working in public service jobs, such as military service, public education or social work, can get their debt payments erased after 10 years of on-time payments. However, to qualify, loaners need to be in the federal Direct Loan Program.

Weston recommends for private student loans that students pay these loans as soon as possible due to high interests rates.

I hope some of these tips assist you in your financial lives, and you all continue to pursue information about finance.  Never be afraid to ask questions and learn how to save.

I would suggest reading “The Total Money Makeover” by Dave Ramsey if you want to learn more about managing debt.

If you are interested in a “behavioral economist” approach to finance, you should read “Psych Yourself Rich” by Farnoosh Torabi.

I would recommend reading “Your Money or Your Life” by Vick Robin and Joe Dominguez to learn aobout priortizing your finances.

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