As I reflect on the whirlwind year that was 2019, I find myself overcome with emotions especially as I think about all that I have accomplished personally and professionally. In shining a light on my professional feats, leaving the university that I have called home for 17 years (first as an Upward Bound student, second as an undergraduate, third as a professional, and lastly a graduate student) to soar new heights at an new organization was dual parts exhilarating and frightening. Settling into my new role, I can confidently state that I have found an ease in knowing that my vast experiences and knowledge would be integral as I now work with a new caseload of New York City public high school students. These students’ post-secondary pathways are as unique as they are and as such, attention must be paid and care must be intentional. Moreover, as I work to discover just how unique their academic and personal needs are, I am also working to uncover what knowledge they already possess about the college application process, specifically as it relates to financial aid.
From introducing concepts such as award letters, FAFSA, subsidized and unsubsidized loans, Pell Grant, TAP, and taxes to dissecting what encompasses an institution’s sticker price, I find that the level of education varies and the gap is wide. Likewise, when introducing additional concepts that are often related to college such as a checking and savings account, credit cards, debt, interest rates, money as a medium of exchange or unit of account, I find that knowledge is minimal to non-existent. As a result, I am eager to delve deeper to uncover why such knowledge is low. In the interim, I believe I can point to one source of this illiteracy – a lack of early action education. In analyzing the many positive effects that early action financial education and planning has on a child’s personal development, I decided to participate in a #CreditChat hosted by Experian that centered on the various ways to introduce banking, debt, money, and saving to children of different ages. Here are my responses: Q1: How would you explain where money comes from to a child? WW: My first introduction to money was through a coin counting game. As such, when accompanying my parents to stores, I was given coins and had to use the dimes, nickels, pennies, and quarters to add up to the total amount. I will be playing a similar game with my child/ren. Q2: How would you explain to a child that credit cards are not free or infinite money? WW: Because most children are learning how to expand their vocabulary, using and explaining term such as borrowing, lending, monthly statements, etc. is a start. I would also show them my monthly statement as an example. Q3: How would you explain to a child what money is and what it does? WW: When teaching my introductory course, I always talk about the three functions of money and their purposes. For my child, I would use a dollar bill to simply break down each function. Q4: How would you answer a child who wants to know how much money you make? WW: When I first asked my mother how much money she made she grabbed her paystub and explained the “net” and “gross” amounts and what taxes were. I am certain that I will do the same, explaining each line items in an easy-to-understand tone. Q5: How would you answer your child when they asked, “Are we rich or poor?” WW: First, I’d ask what their understanding of “poor” or “rich” is. Next, I would use this question as an opportunity to talk about the differences between families and individuals with an abundance of access, money, and resources versus those who are not as fortunate. Q6: What’s your strategy for explaining why you can’t or don’t want to buy something for your child? WW: Being transparent without overloading them with advanced concepts and terms. As a result, I would be honest about not being able to afford an item/items of the moment because payment is needed elsewhere. Financial honesty is truly the best policy. Q7: What are some ways to explain the importance of savings to kids? WW: Tried-and-true methods of piggy banks and savings jars are an optimal start! To begin, have your child outline what their saving goal is and the timeframe in which they want to execute this goal. Then, have them start small by saving leftover change and bills. Q8: What are some ways to show kids how to spend within their means? WW: An early introduction to budgeting never hurts! Once they become aware of what their spending limit is that week, the next two weeks, or the entire month, they will (hopefully) begin becoming intentional about purchases and overall spending. Q9: How do you talk to kids about debt in ways they will understand? WW: Easing into the conversation is important. Show them your credit score and explain why the numbers are high or low. Show them your monthly credit card statement and explain why the amount is high, why the interest is high, and why it is taking longer to pay off. Q10: Any final tips on teaching kids about money? WW: As always, I highly encourage early action planning. Thus, whether your child’s introduction to money is through interactive games, hearty discussions, or tutorial through documents, their education starts now!
0 Comments
There are four weeks until we collectively bid farewell to summer 2019 and welcome back the anticipated season: fall. For a majority of individuals, fall is the most wonderful time of the year due to all-things pumpkin, brisk weather, the change of color in foliage, fall fashion, Halloween, and Thanksgiving (should you celebrate). Thus, as individuals take stock and reflect on summer as a whole, it is my hope that financial reflections were had, too. As such, when examining bank accounts, credit card balances, loan balances, and monthly statements, it is important to highlight the successes, as well as outline amendments and changes that need to be made moving forward. Therefore, if one is looking to either boost both their checking and savings accounts, lower monthly bills and statements, and tangibly plan for a financially solid remainder of 2019, an option to explore is financial dieting.
Financial dieting allows one to thoroughly assess their current financial circumstances and then create a realistic plan to cut, or rollback, on excess spending. Thus, should overspending on dining out contribute to a rapid depletion of funds, scaling back can occur. As a reminder, because every individual, level of income, and financial need are unique, assessing where to begin scaling back, and how much to scale back overall, will be equally unique. As one begins identifying problem areas that need correction, be mindful that the goal is not deprivation, but preservation. Financial depravity is not encouraged for the mission is not to punish those who indulge in excess spending but use such behaviors as the foundation for education. Additionally, encouragement as one begins bargain shopping, canceling subscriptions, creating budgets, reading financial literature of effective saving techniques, and more is needed. Moreover, encouragement as one financially and mentally prepares for another impending recession is needed, too! According to Neil Irwin of the New York Times, while the United States is not currently in a recession, and may well avoid one in the future, the “chances that the nation will fall into recession have increased sharply in the last two weeks.” What has heightened this probability is the “unmistakable message that global investors in the bond market are sending. Longer-term interest rates have plunged since the end of July” (Irwin, 2019). Moreover, Irwin writes that the shift “historically tends to predict slower growth, interest rate cuts from the Federal Reserve, and a heightened risk that the economy slips into outright contraction.” As a lifelong student of economics, the thought of further studying these trends fascinates me. As a financial educator, such information excitedly propels me to break down the information so that is readily understandable for my audiences. However, as an individual existing under corrupt capitalism, the thought of yet another financial crisis leaves me anxious and panicked. Yes, I know that this impending recession will (hopefully) not be as huge as the 2008 Fiscal Crisis, but the thought of fiscal uncertainty for a large percentage of Americans is plaguing. For this reason, and many more unnamed, it is time to become serious about financial dieting. To be clear, financial dieting is not the be-all and end-all to solving how to survive should the recession hit. Moreover, financial dieting will not drastically move one from a lower tax bracket to a higher bracket, and it certainly will not close the gender, race, and wealth gaps, or eradicate poverty – only practical, real-world state and federal policies can help to achieve this. But, for the sake of employing tangible, positive fiscal habits, financial dieting is a start. To expand upon financial dieting and fasting further, visit financial expert Winnie Sun’s Twitter page and peruse her insightful thread from August 14th. Below you will find my thoughts on the subject. Enjoy! Q1: Only buying what you NEED mean something different to everyone. What are some good rules/guidelines to follow during a financial fast? What do you still spend money on, what no longer makes the cut, and where do you draw the line? WW: During a financial diet, it is important to remember that while saving for, and spending on, necessities is key, there should be no shame when buying items outside of your list. Therefore, spending on needs vs. wants should not result in prolonged buyer’s remorse. #WinnieSun Q2: The talk of tariffs also mean things are going to cost more, and we’ll have less to spend. What steps do you take as you prepare to cut off your unnecessary costs? How do you change your shopping and spending habits? WW: Begin shedding financial deadweight now. For example, begin examining which subscriptions can be canceled, as well as which memberships no longer bring you joy. Employing practical, fiscal techniques now will help cultivate consistent habits once the markets drastically shift. #WinnieSun Q3: Feeling frugal? What is the biggest benefit to ceasing your spending? How can going on a cold turkey spending fast help you become more conscious of your spending and break bad money habits? WW: One benefit is having options associated with income saved. For example, with the money saved, I have the option to invest in professional development opportunities tied to my 9am – 5pm or investing in items related to my 7pm – 2am (financial literacy business). #WinnieSun Q4: They don’t call it a Financial Fasting Challenge for nothing. It’s challenging if you’ve done a financial fast, what was the hardest part to you? If you haven’t what do you imagine will be the most difficult part and how can you prepare yourself for the struggles? WW: I embarked on a financial fast last year and remaining consistent proved to be difficult at times. Possessing this abundance of knowledge, and often not practicing sound fiscal habits, is complex and unearthed truths that I was not ready to confront. #WinnieSun Q5: How long do you go? What is the best amount of time to financially fast? How do you determine the best durations of time and frequency to hit the pause button on your spending? WW: I financially fasted in increments: 30 days, then 60 days. One looking to financially fast has to find the duration that best fits their circumstances, commitment, and schedule. #WinnieSun Q6: Cash or card? Do you prefer to pay for your necessities with credit cards or cash> What are the pros and cons to both? WW: Drake may not carry cash because his money is digital, but I am a tried-and-true paper in the wallet kind of gal! Additionally, I am still weary of credit (because of identity theft) and have found that I best budget when I can see and physically count my money. #WinnieSun Q7: Track your journey! When it comes to a money experiment like financial fasting, do you end up relying on a budget or do you think it becomes second nature since the budget is so bare bones? Do you track your thoughts and expenses in a journal? WW: I am a visual learner, so having a color-coded, visual budget is essential in all of my financial processes. Additionally, I cannot stress enough how beneficial it is to have a money diary to track the day’s expenses through storytelling. #WinnieSun Q8: What deters you when you’re tempted to make an unnecessary purchase? How do you remove/resist the temptation to buy things you don’t need? What tricks and tips work best in your experience? WW: Overanalyzing previous “unnecessary” purchases and overwhelming feelings of buyer’s remorse have deterred me from making unnecessary purchases in the past. As a result, I never like feeling as if I am reckless with money. Moreover, I work overtime to ensure that every dollar earned is spent wisely. #WinnieSun Q9: OK, you completed your goal of financial fasting and have saved some money. Yay! Now what? How do you ease out of your fast without finding yourself going on a full-fledged spending spree and undoing all of your hard work? WW: If saved funds are not spent on necessary items and purchases, then the funds are deposited into my savings account for safekeeping. #WinnieSun Q10: How can you get creative finding solutions to what you’re tempted to buy while on a financial fast? What “make it work” moments are you most proud of when it comes to using what you already have instead of buying something new? WW: Being creative is as unique as the individual. Therefore, shake things up as you see fit and only purchase new items if current items are completely broken or torn beyond repair. #WinnieSun Q11: Sure, food is a necessity, but that doesn’t mean you need to go crazy at the grocery store, go restaurant hopping, etc. What are the best budgeting tips to keep your spending in check when it comes to necessity items. What practices help you stretch your dollar? WW: While eating out is often convenient and fun, resolve to dine out in moderation. As such, limit eating out to once a week or twice a month. Again, you can enjoy life’s pleasures, but pleasure in excess can be (literally) costly! #WinnieSun Q12: If a full financial fast sounds too extreme for you, what baby steps or trials could you practice so you can “train” to build up to it? WW: As previously mentioned, assess memberships and subscriptions that no longer fulfill you and can be canceled. #WinnieSun Q13: What’s your motivation? What are you looking to gain by restricting your spending? What goals are you saving for? WW: First, my motivation is the satisfaction of knowing that I can “talk the talk” and subsequently put those words into action. Second, it would be comforting to know that my small actions can yield positive results as I seek to have a secure financial future. #WinnieSun With five months left to 2019, it is my fervent wish that your financial journey thus far has been prosperous. Although I am certain that unforeseen mishaps, and unexpected costs, may have briefly hindered progress, the key is to remain diligent and steadfast in the completion of short – and long-term goals. Thus, whether you resolved to budget twice and thrice as hard as the months before, have reduced your credit card, an overall, debt, or are ready to book that long overdue vacation, again, full commitment to creating and executing steps for success is crucial.
In examining credit card debt, and the eradication of this lingering debt, further, it is important to note that while education on credit is abundant, access can be limited. Additionally, because every level of comprehension is as unique as the individual, one cannot assume that the information available is easy to digest – it is not. Truly comprehending what credit is, credit laws, interest, and the consequences of poor credit management takes time. To help individuals in this process, Experian held another #CreditChat on Wednesday, July 17th. As such, financial advisors, educators, and enthusiasts spent an hour showcasing their expertise while reflecting on current and past experiences regarding credit. Below you will find my answers to these compelling questions and I encourage you to share your own answers, too! Q1: When did you start realizing how important credit is? WW: Whenever my mother’s monthly credit card statement arrived, she would focus all of her energy on this singular piece of mail before anything else. Setting aside the necessary funds to pay her credit card bill was of the utmost priority! #CreditChat Q2: How did you start building credit? WW: Through student loans. I had borrowed one $6,000 subsidized loan as an undergraduate and was diligent about successfully paying it off upon graduation. #CreditChat Q3: How often do you check your credit report? WW: Whenever Chase emails me about changes to my credit score via the Chase Credit Journey report, I immediately check. #CreditChat Q4: How do you fix an error on your credit report? WW: Similar to many of the responses throughout this thread, immediately contact the credit bureau should you believe information is incorrect. Bureaus like Experian will investigate the claim and report back with a response within 30 days. #CreditChat Q5: What are some pros and cons of being an authorized user on a credit card? WW: My uncle was an authorized user for my first credit card and the benefits were plentiful, including me building credit. However, I often struggled to pay the monthly balance due to inconsistent income and funds, so he often had to pick up where I could not. #CreditChat Q6: Is it a good idea to request a credit line increase? WW: If your credit is top notch and your track record is sold, requesting a credit increase, and subsequent approval, should not pose as an issue. Moreover, with the increase, you should be able to continue making consistent monthly payments. #CreditChat Q7: In what order should you pay off your credit cards? WW: The credit card with the highest interest rate should be paid off first. Choosing this card first will allow you to repay the debt in a shorter amount of time and will help you avoid unnecessary charges. #CreditChat Q8: Should you cancel credit cards that you don’t use? WW: Canceling credit accounts can negatively impact your credit score, especially if the balance(s) on all other cards still need to be paid. Additionally, if the credit card you seek to close is your oldest, leave it open! #CreditChat Q9: How do you stay motivated to work on increasing your credit score? WW: Remind yourself that you are working to achieve long-term financial goals, and a solid credit score assists in achieving this goal. Likewise, the road to financial freedom and security is exhausting; however, it needs to be done. Also, finance must work in the best interest of the people, too! #CreditChat Q10: Any final tips on improving credit scores? WW: Don’t close unused credit cards; keep credit card balances low; and pay all bills on time. #CreditChat On Sunday, July 7, 2019, the United States Women's National Soccer Team defeated the Netherlands Women's National Football Team in stunning fashion (2-0) to secure their fourth World Cup victory. Thus, for four weeks (June 7 – July 7), the world watched a myriad of women athletes in awe, bewilderment, and pride as these athletes played for the countries they call home. Additionally, the world watched as these women played to dispel the outdated myth that women athletes will never be equal to, or better than, their male counterparts. Well, the United States Women's National Team not only busted this myth, but they also proved that they are here to be a mainstay in the hearts and minds of fans and media alike. Unfortunately, however, one area that continues to be a thorn in these athletes' side is related to Equal Pay and the fact that the gender wage gap is ever-widening.
To understand why the current gender wage gap is abysmal, we must first examine the law whose mission it is to ensure that wage disparities among the sexes are prohibited, the Equal Pay Act. Enacted in 1963 under the purview of the Equal Employment Opportunity Commission, the Equal Pay Act requires that "men and women be given equal pay for the work conducted in the same establishment." Additionally, it is "job content, not job titles" that determines whether the jobs performed are substantially equal. As a result, employers are prohibited from paying unequal wages to men and women who perform the same duties that require the same effort, responsibility, and skill performed under similar working conditions. Therefore, when analyzing the effort, responsibility, and skill of the women who performed throughout the 2019 Women's World Cup, the argument can be made that they should not be paid equally, but in fact, paid more. To substantiate the overall claim of increased to equitable pay, let us refer to the immediate reaction from the fans as the woman began to celebrate and hoist their trophy: “Equal Pay! Equal Pay!”. Yes, an entire stadium compromised of international fans, from various backgrounds, cultures, and societies, under vastly different economic and political conditions, shouted in unison what we can no longer ignore – the U.S. Soccer Federation has engaged in wage discrimination for far too long and we cannot allow these unfair practices to persist any longer. Thus, one of the first steps taken to eradicate this unjust system of pay began with 28 members of the USNWT filing a class action suit against the U.S. Soccer Federation in March of this year, three months before the official kickoff of the Women's World Cup. According to Graham Hays and ESPN News, the women are seeking class-action status over "institutionalized gender discrimination" towards the team as a whole. Moreover, "despite the fact that these female and male players are called upon to perform the same job responsibilities on their teams and participate in international competition for their single common employer, the USSF, the female players have been consistently paid less money than their male counterparts” (Hays, 2019). Again, we can no longer ignore the evidence that the gender wage gap is abysmal and should cease to exist. When examining just how less these women were paid in comparison to their male counterparts, one of the forty-one complaints filed alludes to the fact that for twenty (20) matches won by the women in a single year, they would earn a maximum of $99,000 ($4,950 per game). However, for the twenty matches won by the men in a single year, they would earn a maximum of $263,320 ($13,166 per game). Midfielder Megan Rapinoe said it best when she exclaimed that “The next best step for us is to continue to fight for what we believe is right, what the law recognizes, equality under the law, equal working condition, and equal pay.” Thus, whether declared by Rapinoe, her teammates, advocates, economists, and fans, the sentiment is the same, pay these women what they are owed. Paychecks should reflect the raw, cultivated talent of these amazing women. And, while are actively working to pay these athletes, let us also pay women as a collective. According to the Bureau of Labor Statistics in 2019, women nationally earned 80.7 cents for every dollar that a man has earned thus far. In breaking this down further, for the first four months of 2019, the overall median weekly earnings were $905; women earned $806 weekly. Peeling back the layers a bit more, the median weekly earnings for Black women were $709 compared to the $826 earned weekly by white women. Latinx women earned $631 weekly as compared to white women. Asian woman earned relatively higher weekly than Black, Latinx, and White women with $1,017; however, this earning is still lower when compared to the median weekly earning of White men who earned $1,033. So, how can we join in the fight for equal pay? The first step is education, specifically knowing the various Equal Pay Days. As such, All Women’s Equal Pay Day is April 2nd; Asian-American Women’s Equal Pay Day is April 5th; Latinx Women’s Equal Pay Day is November 20th; Mom’s Equal Pay Day is June 10th; Black Women’s Equal Pay Day is August 22nd; Native Women’s Equal Pay Day is September 23rd; and White Women’s Equal Pay Day is April 19th. In knowing these important dates, and mobilizing with these dynamic ethnic and racial groups, we can continue the fight in raising awareness about pay inequities and the damaging effects these inequities have on the economic, political, and social fabric of our society. If we are going to tout that we are advocates for women, we must put action behind our words. Pay women; that’s it. That’s the sentiment. |
WhitneyEducation enthusiast whose mission it is to see Financial Literacy receive well-deserved shine. Archives
September 2020
Categories |