7 Smart Money Habits For College Freshmen.

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As featured in Nerdwallet & CS Monitor.

There’s a lot of financial temptation surrounding college students: credit card offers, the availability of student loans, the excitement of being on your own and in control of your spending money.

college freshmen

Freshman year can be a whirlwind of activity. But make some time for one more lesson: Form smart money habits. If you give it a little thought now, you can jumpstart a successful long-term relationship with money—and not end up crushed under a mountain of student loan or credit card debt.

The positive habits you set this year will remain with you long after you’ve earned your cap and gown. I’ve coached many students on how to be savvy with their money and maximize the financial potential of the college years. Here are seven of the most successful ideas.

Random Thoughts:

1. Assume one year’s worth of student loan debt and no more. No matter what.

The average student loan is now $33,000, which makes the class of 2014 the most indebted class in history. Do what you can to stick to one year’s worth of debt, even if it means attending a community college first or working for two years before beginning classes.

It’s radical thinking for some; you may believe this suggestion too austere. But the last thing you want is to be saddled with heavy debt burdens. The college graduate unemployment rate is currently 8.5% and the underemployment rate (new grads who are jobless, hunting for employment or working part-time) stands at 16.8%, according to a report from the Economic Policy Institute.

2. Begin a social media strategy.

And I don’t mean Instagram. Using a social media outlet such as LinkedIn, where you can connect to thought leaders, managers and prospective employers, can pay off down the road when you’re job hunting. Post articles daily—three sentences of poignant commentary reflecting your thoughts and a passion to share knowledge. Set a goal of acquiring 600 LinkedIn contacts by the time you graduate.

Drunk on toilet Not a good pic for social media.

Also use your first year as an opportunity to “clean up” personal social media accounts like Facebook, which is increasingly under scrutiny by human resources departments.

3. Watch your credit.

Take out no more than one credit card to obtain and strengthen a credit score. When I was in college, credit card providers were everywhere. I signed up for two cards and needed to work a couple of jobs to pay off the debt. Don’t do it. Based on recent legislation, credit card vendors are no longer omnipresent on campuses.

There are many attractive cards available to college students. Most likely, you’ll need a co-signer, as you won’t have full-time income. There should be a limit placed on the card, anywhere from a $500 to $1,000 maximum. The lender will most likely place strict limits on your available credit without you asking for it, but inquire anyway.

4. Consider a Roth IRA.

Believe it or not, it’s not too early to begin saving for retirement; think of all the time you have to benefit from investment appreciation. It’s OK to start small; remember, you’re trying to create a lifelong savings habit. Earnings from a part-time job are perfect for funding a Roth IRA.

For 2014, the contribution limit is $5,500, and at retirement, the money is available tax-free. Also, contributions (which are made with after-tax dollars) can be withdrawn at any time before retirement, without penalty.

5. Don’t get carried away with school spirit.

In college, I needed to own every T-shirt, sweatshirt, pen, mug—you name it, all emblazoned with the school logo. I spent hundreds of dollars on stuff I didn’t need due to my out-of-control school spirit. Limit your enthusiasm to two wearable items a year.

6. Begin a budgeting behavior.

Heck, not even an actual budget; I know how busy you’re going to be. A budget mindset is enough. Be aware of your spending habits. Understand once you run out of cash, you’re out. Do not go to the credit card for relief.

And keep a conversation going with your folks. The most successful students have parents who jointly review spending with their kids on a monthly basis. It takes less than 10 minutes to discover the expenditures with the greatest impact on cash flow.

7. Study one money tip each day or week.

It’s not that difficult. Pick any financial topic. Read one article in the business section of a local newspaper daily before you hit the books. One graduate I know read about one basic investing topic weekly at www.investor.gov. She developed a great intuitive sense about stocks, bonds, money markets—enough to ask smart questions that allowed her to maximize her 401(k) savings when she landed a job.

There’s a lot to learn as a freshman; enjoying your college experience to the fullest is important.

Just keep your money in mind, and think about how the actions you take today can either set you on the path to financial success or leave you lost in the woods.

The Colors, The Times, of Your Life – Will You Remember?

Originally posted on Random Thoughts of a Money Muse:

We were free. Moving quick in a white hot breeze. 1977. When the world flew by in lime green.

Slit through a black bowel of public housing. Deep in the middle of the aged carnival colors of blueviolet, aquamarine and bisque. Coney Island. A narrow way forged between the metropolis, slick brown with rot. The summer New York heat penetrated, bounced from dead, white alley cats forming a yellow haze floating neon pungent sluggish slow in still heat. Bright orange, with a burst of unhealthy steel-gray around the edges, like a healthy pink hue that hesitantly abandoned its soul, was there too. Cats and garbage rotted just that way in July. In 1977. In Coney Island. I remember.

The odor scorched the outer part of our pink nostrils until they flared red. But we didn’t care because this moment was designed to be fleeting. The clear blue of escape from…

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The Tolle of the Governor: 6 Steps to Rebirth.

Originally posted on Random Thoughts of a Money Muse:

“Been on the road a couple of months.”

“By yourself?”

“Yea.”

“Where did you live before that?”

“I was in a town.”

“Were the monsters there?”

“No.”

“It was safe. Full of good people.”

“What happened?”

“He just – lost it.”

“Who?”

“Man in charge.”

“I barely made it out alive.”

Brian Heriot aka “The Governor – Philip Blake.”

governor beard

As you rip from the past, forge a path to the present, there’s a good chance the man in charge will unravel.

Actually, it’s guaranteed.

There will be.

A tumble, a spiral down, to discover who you really are inside.

And burn out what’s haunting your sleep.

Because fire cleanses.

Extinguished fires leave imprints.

Black stains scar foundations.

governor burn three

I’ve learned to fear and respect fire of the mind. 

You won’t notice change; at the surface you’ve built high fences. However, underneath, today’s thoughts are directing steps to a place you must…

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Have Kids? 4 Ways to Save Money: 4 Ways Dave Ramsey gets it Wrong.

Originally posted on Random Thoughts of a Money Muse:

“Money is more than money, sometimes it’s memory.”

I’ll never forget the March day in 1973 when the birthday gift from my parents – a new lime-green Schwinn 10-speed with a prism-like banana seat (complete with black double-stripe down the middle) was stolen from outside the Brooklyn neighborhood toy store – Cheap Charlie’s.

green schwinn

I believed I did all the right things to ensure my prized possession was secured tightly to a small tree.  It was in my line of sight; no matter where I was, even checking out stacks of Hasbro Colorforms’ boxes at the back of my favorite five and dime, I could glance out the large plate glass windows and observe some part of the bike’s beautiful, clean lines.

Padlock checked twice. Pulled on the lock again, just to be sure I wasn’t fooling myself that the bike was secure.

It wasn’t enough to keep this new birthday…

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Have Kids? 4 Ways to Save Money: 4 Ways Dave Ramsey gets it Wrong.

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“Money is more than money, sometimes it’s memory.”

I’ll never forget the March day in 1973 when the birthday gift from my parents – a new lime-green Schwinn 10-speed with a prism-like banana seat (complete with black double-stripe down the middle) was stolen from outside the Brooklyn neighborhood toy store – Cheap Charlie’s.

green schwinn

I believed I did all the right things to ensure my prized possession was secured tightly to a small tree.  It was in my line of sight; no matter where I was, even checking out stacks of Hasbro Colorforms’ boxes at the back of my favorite five and dime, I could glance out the large plate glass windows and observe some part of the bike’s beautiful, clean lines.

Padlock checked twice. Pulled on the lock again, just to be sure I wasn’t fooling myself that the bike was secure.

It wasn’t enough to keep this new birthday purchase from disappearing.

Looked up from the new GI Joe Adventure Team play sets and in less than two minutes the bike was history. I bolted out the front door, looked around, up and down Avenue U as fast as my head could turn and eyes would dart.

mummy tomb My favorite!!

Nothing.  How did the bastard get away so quickly? Oh yeah, he was on wheels.

How do I now tell my parents the expensive gift that surprised me three hours earlier was now history?

Recently, Dave Ramsey or his people (he’s big time, he has people), wrote an article that rubbed me the wrong way. Usually, I agree with the information that Dave provides however, this piece (link below) inspired the line about money linked to memory.

10 Ways We Waste Money On Our Kids.

The Ramsey article was the catalyst to re-live a painful life episode from over forty years ago.

What happened after the incident was memorable, too.  In a good way.

And I’ll never forget.

Back to Dave’s article: Used bikes, no hamsters as pets – Made me grateful to not be a kid or grandchild under the Ramsey roof.

Is there a balanced approach here so rodents can still scurry through colorful Habittrail tubes in happy homes?

I think so.

habitrail I bet Dave would hate Habittrail (too expensive).

Let’s break it down.

Here are 4 ways to save and 4 areas where Dave Ramsey is way off the mark.

 Random Thoughts:

1). Go used or reused. I don’t believe our money has achieved the maximum return on thrift stores or consignment shops.

Thankfully, the stigma of shopping at a Salvation Army is dying; perhaps it’s the disappointing economic recovery where much of the middle class feels like the Great Recession never ended. Recently, my daughter and I went shopping for a winter week-long trip to New York City and found some astounding cold weather wear deals at a neighborhood place that sells gently-used teen clothing. Check out www.thethriftshopper.com for a national thrift store directory and a shoppers’ forum where all topics thrift are discussed.

2). Arts and crafts fun not boring. Crafting dollars still go a long way and what a method to engage your child in a family creative endeavor. I know it sounds old school, however some of the best returns on memory I have with my daughter is the Halloween and autumn-related crafts we did at home. We finished multiple joint projects including fall wreaths and small sentiments for family and it was short on cost, long on satisfaction. Sign up for Pinterest and investigate fall craft ideas. I was floored by the number of inexpensive DIY Halloween projects.

3). Get tricky. When I was a kid I drove my mother crazy because I was only interested in popular name brands of food. I was a sucker for television advertising. For example, I would only eat the bacon with the Indian head profile complete with full headdress, on the front of the package – can’t recall the name now. Of course, it was the most expensive and as a single parent household, mom was on a tight budget. I still remember catching her placing a less popular bacon in an old package of the brand I liked.  Come to think of it, I think she did this often. I recall on occasion my Lucky Charms not having as many marshmallows. Oh the shame! She was attempting to trick me. As I age I realize I’m fine with tricking children. Buy the Frosted Flakes, keep the box and replace with the generic brand to save money. Today, less expensive brands are tough to tell apart from the premium ones. Try it.

4). Don’t miss the forest for the trees. Visit local venues first. This time of year many autumn fairs pop up at farms, places of worship and even retail parking lots. Peruse the local fair festival guides in community impact newspapers and take inexpensive journeys.  It’s a great time to have children select and prepare fresh vegetables and fruits available from local vendors.

The stuff Dave Ramsey is saying is a waste may not be to you because money is not just a medium of exchange, it purchases long-term lessons and memories of places and people long gone.

So, despite what the Ramsey group says:

1). Get, or if you can, adopt a pet. The hamster or whatever suits your family. My hamster Benjy lived five years. Yes, five years! And he taught me great responsibility and love. He brought happiness and accomplishment to my life as a nine-year old. I thought he’d live forever. I taught him tricks. He chased my mother around our tiny Brooklyn walk-up (an added bonus). Dave says no Benjy. I’m sorry, this advice is wrong.

2). Say yes to movie tickets. Ok, you don’t want your six-year old to see The Equalizer, I get it. Although my father took me to The Godfather when it first hit theatres and Sonny getting converted into human Swiss cheese at the tollbooth affected me for years, there is a bonding experience between parents and children at the movies. So, you sit through Little Fluffy Bunny Finds a Carrot or whatever kids’ flick is playing. Take your children to the movies. Splurge on the overpriced candy and popcorn.

3). Yes to electronic games, too. My friend Jordan Shapiro, professor, teacher, author, contributor to Forbes and modern-day Socrates would advise you that electronic games can teach children much about life and ignite cognitive development. There are many ways to save here – plenty of gaming systems available used and in great condition, especially at pawn shops. I spent hours with my Batman coloring books; I agree crayons have a place in kids’ rooms, however, I don’t see how electronic games are a waste of money.

4). Buy the kid a new bike for gosh sakes. There’s nothing like the thrill of a new bike for a kid. All the adventures ahead – the feelings of freedom. Nothing but priceless. My head is reeling thinking about the places I went on two wheels.

Ah, so you’re wondering how I had so many great adventures when my bike was stolen the same day I got it.

Well, when I called my father from the kitchen Trimline phone crying hysterically, he immediately left work in the middle of the day (which only happened twice during my childhood),  and drove me to Frank’s Schwinn Shop on East 6th Street and bought me an identical replacement.

He said it wasn’t my fault.

On his deathbed, while he lapsed in and out of a coma, I whispered in my dad’s ear, reminded him about how I was grateful for him. And that damn bike episode. How it changed my life. He was there for me through a traumatic event.

It’s unfortunate when financial types become so successful they forget what money is truly all about. It’s “eat your vegetables, don’t have fun.”

No it isn’t.

“Money is more than money, sometimes it’s memory.”

So screw that advice.

remember moments

The Life In The Mirror. 3 Ways to Save It.

Richard Rosso:

I bolted. Ran out the door. Down three flights of stairs. 3am. Screaming. For a Brooklyn street it was eerie quiet. Dark. Street lights out. A desperate sprint. In pajamas. To the only pay phone close by. Would it be working? It had to be the most vandalized pay phone in the city. Odds weren’t good.

Directly across the avenue from Harold’s Pharmacy.

Originally posted on Random Thoughts of a Money Muse:

I bolted. Ran out the door. Down three flights of stairs. 3am. Screaming. For a Brooklyn street it was eerie quiet. Dark. Street lights out. A desperate sprint. In pajamas. To the only pay phone close by. Would it be working? It had to be the most vandalized pay phone in the city.Odds weren’t good.

Directly across the avenue from Harold’s Pharmacy.

Neon beacon in the night. Still around.

It was a shabby three-room apartment in a pre-WWII three-story walk up.  But it was shelter. That’s all I cared about. It was my world for a time and to me it felt big when things were good and amazingly small and cloying when things were bad.

Lately it felt as if I was living on a pin and the head was about to run out of room.   For an old building, the steam heat worked amazingly well. New York cold was occasionally harsh, so I was grateful. Turn the valve for…

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When Fear Turns to Strength – 4 Ways to Stand for What you Believe.

Richard Rosso:

There’s a switch inside your brain. Maybe deeper than that. A beacon, a light, buried under the ice. Takes a lot to turn it on – the switch to warmth comes from faith and fight. A passion for what you believe, because you know it’s the right thing. For others.

Originally posted on Random Thoughts of a Money Muse:

“She may never come out of this Richard, but she may. You never know.”

Some doctor at Coney Island Hospital blurted these meaningless words at me. Advised me how this time around, this attempt to take her life was most likely, going to be successful. Or not.

Mom really did it this time, that I did realize. Now in a coma. I saved her. Just in time. At least I thought I did. Obviously, to the doc anyway, my “just in time,” was not timely enough. Or was it? I couldn’t tell from his words.

And I was scared. She was hooked to a respirator. Last time she tried to take her own life, mom was home the next day, following a stomach pumping. This felt different. Or didn’t.

It looked bad. And at ten years old I was scared. Shaken. Perhaps this doctor was right. Or not. The system…

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