BFF Robert J. Holland visited Towson last week. He sat in my two PR Writing classes, offering insight and wisdom from his years of experience. He also spoke to our Student PR Group on what students need to know to be successful in their careers. Robert’s involvement with my students constituted a wonderful professional development opportunity.
But there was another aspect to Robert’s visit that has me thinking. When we weren’t talking about communication/PR/IMC, Robert and I were talking about personal financial management. At 45 and a successful independent communication consultant, Robert is concerned with financial management. So am I. I always have been.
Robert and I talked personal financial management strategy from our respective viewpoints. He has two sons, ages 15 and 11. My son is 31 and has a family of his own. Therefore, our financial needs and considerations are different. He is raising and educating his two fine sons. He must manage his money to do this effectively. He must also plan for retirement. I have been there, done that. At 60, my most compelling need is to plan for retirement (but not any time soon, for I love what I am doing far too much to quit).
Our conversations crystallized my thinking into this: I believe that every college student ought to be required to take personal financial management courses. What better gift for students than to help them become competent money managers. I believe the purpose of college is to prepare students for careers that will enable them to be independent, productive members of society capable of managing all aspects of their lives. Money management is critical to success.
Disclaimer: I am not a certified financial manager. It is not my place to advise people on financial management. There are many qualified experts available for that. However, I have studied financial management all of my life out of necessity and interest, but I retain the services of a qualified, certified, credentialed financial expert to manage my personal portfolio. My advisor is with Edelman Financial Services, LLC. I am not the one to tell you what to invest in, but I will tell you to learn to manage money. It is a life skill that will serve you well, and you can learn it.
In order to get to a point where I needed a financial adviser, I had to learn to manage money effectively on my own. This I did with great enthusiasm. From my first paycheck from my first real job, I followed a simple, yet powerful, strategy: I saved money and lived within my means. That simply means that I practiced a concept all-too-foreign to many today, that is, delayed gratification. I refused to let myself fall into the trap of “must have it now no matter whether or not I can afford it.” I did not run up debt to have things. I saved and invested 25 cents out of every dollar I ever made. That was my simple financial management strategy for many years. And you know what? It worked.
Now, students who are nearing graduation must begin to think about issues like personal financial management. It will soon fall to them to earn their own money and manage it in order to meet the daily obligations of living productively and independently. It is now time to adopt a longer-term perspective. I strongly urge graduates to practice delayed gratification. When you begin earning your first paychecks, do not rush into buying expensive cars, clothing, or things you don’t really need. Wait. Build up your resources. Save and invest money. Before you know it, you will have amassed a substantial reserve to help you in troubled times or to use for some enjoyment or the down payment on a great house.
Thinking long-term, if you wish to marry and raise a family, current estimates are that raising a child from birth to age 18 requires expenditures of approximately $200,000. Add a college education, and the total rises to $250,000. Plus, that is added to general day-to-day expenses of running a household.
So, where can you turn for advice? Edelman Financial Services’ founder, Ric Edelman, offers us all we need to know in his book The Truth About Money, Third Edition. This book is a solid investment for anyone who wishes to become a competent personal financial manager. If you want to learn to manage your money, then this book will teach you how.
Les, clipped to my fridge is an article from one of Toronto’s commuter papers talking about a new course at George Brown College targeted to 25-to-35-year olds – it’s called Financial Basics: Manage Your Money for the Long Run. I’m no dummy, but it’s on my fridge for a reason. Fortunately, I’m going to compensate for my lack of financial planning over the past decade by being ridiculously successful over the next one.
phjenkins, you are a credit to Centennial College. And I love your blog, especially its name, “since you didn’t ask.”
Your supportive comments are enlightening and appreciated. Good for George Brown College, or more specifically, its students.
Yes, phjenkins, you are no dummy. I love the way you write, You have a distinctive style in making the excellent points you make in your blog. I have no doubt that you will be wildly successful in your career. A suggestion: begin looking for an appropriate financial manager. I think you will need one soon.
Awww, don’t listen to Uncle Les, kiddies! There’ll be 6-7 good bullmarkets before you retire, and — hey! — what’s a little debt? It’s just leveraging a little!
(And there is a Santa Claus, Virginia….he just doesn’t deliver money).
Like all too many people, I came to (some degree) of financial management all too late in life — about age 40. Because I live in Denmark (where my very high taxes ensure my children’s university education, and my medical for life and their medical until they are 18), I don’t have the same worries as many Americans my age.
Still…. salt away a little bit of your paycheck every month until you are 40 or 45 and you are home clear. Playing catchup from 35 is hard; from 40 up, it’s a tough nut.
And never think health isn’t a fragile thing.
I got Les’ advice when I was 22, from someone else, I wish I had listened.
Listen to Les.
Les,
Your philosophy of “living within your means” is so crucial to financial stability. Fortunately for me, my Mom is a financial advisor for Wachovia and I call her sometimes daily seeking advice for financial matters.
I look forward to graduating and earning my first “real” paycheck to (1) begin paying off student loans and (2) smartly investing for my future.
The advice my Mom reiterates to people is to be proactive in their financial matters and be realistic with your expenditures because the majority of people are in denial.
P.S. Remember to always pay yourself first, (like Les did by putting away 25 cents for every dollar). This doesn’t mean buying yourself something nice. It means setting up an automatic recurring deduction every month that transfers money into a savings account – better yet a savings account you cannot touch.
Here’s a link to top 10 financial tips:
http://financialplan.about.com/cs/personalfinance/a/TopTenMoneyTips.htm