As students get ready to go back for the fall semester of college, I thought it would be a great time to take a moment and share some tips for saving a few dollars and getting started on the right financial foot. This is an article that I wrote for HBCU Digest.
Love my articles? Don’t forget to come out and see me as I drive cross country to spread simple financial literacy tips in a 1994 Ford Aspire.
When talking about financial literacy, credit scores come up often. Credit scores are made up of complex algorithms that take many behavioral aspects into account. It might seem complicated, but there are only five main parts of a credit score:
– Payment history
– Debt ratio
– Types of credit used
– Length of credit history
– Inquiries
Today, we’re going to talk about inquiries. There are two common types of inquiries on your credit score: “hard” inquiries and “soft” inquiries.
Hard inquiries are when you allow a institution to check your credit score or “run your credit” in order to decide if they will extend you credit. When you allow an organization to make a hard inquiry on your credit report there will be a notation made on your credit report that will stay for two years. The fewer the hard inquiries on your credit report, the higher your credit score will be. Only let organizations that you really want credit from to check your credit score.
Soft inquiries are when you pull your own credit report and/or scores. There is no downside to taking a look at your own credit score. Now, you can pull your credit reports, not scores, for free. Knowing what’s going on will often empower you to make changes or give yourself a pat on the back. Many times credit scores are higher than you thought.
Keep in mind that there are three major credit reporting bureaus in the US. To get an accurate picture of your financial health you’ll need to pull reports and scores from all three bureaus for $40.
Read more about credit scores and reports in Money Matters: The Get It Done in 1 Minute Workbook and 10 Things College Students Need to Know About Money. Check them out.
He's a business, man!
I took a close look at The Decision and thought about how we all can apply Lebron’s strategies wealth building strategies to the average employee. Do you know your worth? Are you building your brand? Check out my personal finance suggestions on Shalena D.I.V.A.
Watch the new video from Shay on using your career to build your wealth.
What are you doing Tuesday, August 4th? I’ll be delivering a webinar entitled “Need help getting your financial literacy program in schools?”
Learn effective ways to get your program in front of the students who need it!
Do you ever struggle to “get your foot in the school door” to provide your much-needed financial literacy program to students? If so, you’re not alone and now there’s a webinar addressing this important topic.
Join us on August 4 for “Best Practices: How to Get Your Financial Literacy Program into Schools,” the third-quarter webinar from the California & Nevada Youth Involvement Network (CNYIN).
In this webinar, you will:* Learn ways other credit union professionals have successfully entered into schools.
* Understand the time and effort needed to implement a successful financial literacy program.
* Discover how to make your financial literacy program appealing to schools.The webinar will be presented by Shay Olivarria, a consultant, speaker, and author on finance; Michelle Lawrence, education coordinator, American First CU; and Dhara Sanchez, COO, Inland Empire CU.
Who Should Attend:* CNYIN members
* Branch managers
* Marketing & Business Development professionals
* Operations professionals
* Training professionalsM
* In-school education CU staffMeet the presenter, Shay Olivarria:
Olivarria is a consultant, speaker, and author of Money Matters: The Get It Done in 1 Minute Workbook and 10 Things College Students Need to Know About Money. You’ve seen her in Redbook and read her articles in The South L.A. Report, SquareRootz.net, and HBCU Digest, among others. She’s appeared on domestic and international radio shows and worked with high schools, colleges, and community organizations. For more information on Shay, go to http://www.BiggerThanYourBlock.com.FREE for all CNYIN members
$50.00 for non-CNYIN members
Individual Development Account (IDA) are one of the tools that encourage people to save. These accounts are managed by community organizations in every state in the US. and usually offer a monetary “match” to those that save a specific amount of money. For example, if you open an IDA with the promise to save $1,000 to open a business the community organization will promise to contribute an extra $3,000 giving you a total of $4,000 to open your business.
Community organizations claim that IDAs are great ways to help low income families save, but I’m not so sure. The motivation behind the IDAs is that low income families will be able to save money quickly and, hopefully, start making some long-term behavioral changes. My concern is that the matching is what motivates people to save. What motivates people to save when there is no matching? Everyone working in financial education understands that giving people more money isn’t the answer to ending poverty. Unless people decide to make different decisions they will be just as broke as they were before they received the money.
There are 4 money topics every couple should talk about asap.
It’s a sad fact to acknowledge, but money and security is more important to lots of folks than love. You can be as upset with me as you like, but that’s the truth. You think your relationship isn’t like that? Let’s see one of the partners in a relationship lose their job and have no income for a year or two. Let’s have one partner that’s a super saver and one that’s a super spender under one roof and you tell me how it works out. Some of you ardent defenders of love are now say, “well, that’s a specific instance” and “those are gross exaggerations of the situation” … riiiight. We all know people in situations like these. They are more common than we want to talk about.
With all the excitement over folks getting a mate, I notice there isn’t much discussion about keeping a mate. To that end, this post is about strengthening a relationship that’s already in place. There are 4 things that every couple should talk about asap. Of course, conversations about money should be ongoing however these are topics that you cannot put off and cannot be overlooked:
Credit scores and reports
I know you’re going to be upset, but you can’t trust anyone to tell you what their credit scores are. The reason? Most people don’t know. Each of us has 3 separate scores from each of the 3 major credit agencies and those scores go up and down every month depending on our behavior. It behooves each partner to pull their credit scores and reports and sit down to talk money strategy. If you’re building a life together, you have to know where you’re starting from. It’ll cost each partner about $50 to pull all three reports with scores, but it might save you thousands of dollars over your relationship and possibly … you’re relationship too.
Money attitude
Once you have your reports you may start to ask questions. If your partner is an ardent saver with a pristine report you may want to know how they did it? Does your partner live on less than what they make because they haven’t contributed a penny to a retirement account? Do they use coupons? Do they borrow money from parents to cover shortages? It’s important to know what behaviors are contributing to their credit report. Those behaviors may class with yours.
I’ve learned the hard way that money isn’t what makes people poor or wealthy. Attitude is what makes people poor or wealthy. If someone has $100,000 in debt because they like to buy expensive things, giving them the money to pay the dent off won’t make a difference. When the debt has been paid off they will rack it up again because they have not changed their behaviors. What behaviors does your partner have?
Who’s in charge?
You will be responsible for paying the bills? Who is in charge of purchasing groceries? You will choose what retirement strategy you use? You can take turns, you can do it together or you can choose one of you to be responsible for it, but you must make a decision. There are no wrong choices. Sometimes it’s easier to play to the strengths of each partner and delegate that one partner deal with the retirement plans while the other partner pay the bills every month. Once it’s settled you both still need to sit down once every 3 months to make sure that you’re reaching your goals. If you’re not, with only 3 months of miscalculations things are pretty easily correctable.
Workarounds
No one is perfect. Each of us has shortcomings and things that annoy our partners. The best thing to do is own up to it and create a set of workarounds for each of you. For example, I know that I love to travel. I used to have all the travel deals come to my inbox every day. As a new trip to some great place showed up in my email I would start to plan my escape only to realize that it didn’t fit into my spending plan. Which made me sad for a minute. Then it made me upset. Then it made me want to eat noodles all week to be able to pay for it and not mess up my spending plan. This is a horrible cycle that would happen at least once a week until I created my own little workaround. I stopped having those travel deals sent to my inbox. You know what? I don’t even think about them any more. What easy workarounds can you figure out to help you and your partner stay on track?
When we choose partners we do it for many reasons. Very few of us will see someone walk down the street and think, “wow! look at the credit score on that one!” but many of us end potentially awesome relationships over who spends too much money or who nags about how many video games are purchased each month. If the person isn’t a good fit for you emotionally or spiritually, let them go. If they aren’t a good financial fit for you there is a possibility that person can change, and if not isn’t it better that you know from jump?
If a person tells you who they are, believe them.
PEACE
In case you haven’t heard, the California Community College District has entered into a Memorandum of Understanding with Kaplan University whereby students at CCs can take classes at Kaplan for a discount. Sounds good until you read the small print:
#1 Kaplan’s courses cost almost 10 times more than courses at California’s Community Colleges.
#2 Students would have to make sure that the Kaplan class would be acceptable for credit at the community college.
# 3 Even if the Kaplan course is accepted at the Community College there is no guarantee that the school that they transfer to will accept the Kaplan course.
Thanksfully, none of the Community Colleges in Kaplan have signed up to take advantage of the “help” offered from Kaplan, but Kaplan has helped themselves to the reputation of the California Community College system. Kaplan’s plan might be to “encourage” Community College students to transfer to Kaplan to complete their undergraduate degree. Kaplan’s reputation in high education circles is so-so, at best.
Be aware of what’s going on in higher education as costs are going up and what you get for your money seems to be less and less.
According a study conducted by Charles Schwab, “nearly 9 in 10 say they want to learn how to make their money grow (89 percent). Two-thirds (65 percent) believe learning about money management is ‘interesting,’ and 60 percent say that learning about money management is one of their top priorities.” Do you know what that means? Young people want to learn about spending plans, acquiring appreciating assets, and creating emergency funds.
Order 10 Things College Students Need to Know About Money on Amazon. Click the photo for more information.
Don’t spend more than you earn.
Put your money into appreciating assets.
Invest for retirement as early as you can.
Etc.
Etc.
The challenge is getting these stogy old ideas to the younger generations in a fresh way. You’ve told your students/children/relatives to set goals for themselves, right? Have you every put it in the context of rapper 50 Cent’s career? You’ve talked to them about creating a budget, but you explained the merits of spending plans? Sometimes it’s not what you say, it’s the way you say it. You think they’re not listening, but they are. You think they don’t see your behaviors, but they do. Teens want to know more about financial literacy. Meet them half way.
I’m excited to be featured Saturday, July 10th on African Speak “Honoring Powerful Black Women in our Community”. As usual I’ll share some financial literacy tips, but I’ll also be talking about my journey from foster care to professional speaker and author in the personal finance arena. Along with me will be:
Jewel Carter – Community Activist / President Urban De’Version
Zekita Tucker – Author / CEO Zeniam Publications
Shanquil Merriwether – Community Activist / Milwaukee Chapter Pres. Action Network.
Join us every Saturday at 6:00pm (Central) for our Live Radio Show. We are dedicated to a rise in awareness of Afrikan people World-wide. We will cover topics that concern our Nation. Come share your views in our Chat Room with individuals of like mind. Call in your questions: (646) 381-4162 / Email your questions at AfrikanSpeak@yahoo.com or Text us at 414-379-7969 http://www.AfrikanSpeak.com
As a special treat I’ll be providing a discount code to purchase 10 Things College Students Need to Know About Money and Money Matters: The Get It Done in 1 Minute Workbook. Listen in online or by phone Saturday 4pm PST and 6pm CST.
Answer 4 questions for your chance to win one of 10 copies!
SORRY. THIS CONTEST IS CLOSED.
Anyone that knows me, knows that July is my favorite month of the year. To that end, I’m giving away 10 copies of 10 Things College Students Need to Know About Money during a month long contest starting July 1! Just take the 4 question survey for your chance to win! The giveaway will only be available from July 1 to July 31.
Winners will be notified by email Monday, August 2nd.
Click here to take the survey.
Bigger Than Your Block 