2014 Scholarship-Earning Essays, Schemes and Mind Maps of Finance

Download 2014 Scholarship-Earning Essays and more Schemes and Mind Maps Finance in PDF only on Docsity! 2014 Scholarship-Earning Essays What can you do to help yourself become financially literate? Winning Essay # 1 Financial literacy is knowledge gained about financial matters. I have been learning about money matters for several years to prepare for life apart from my parents. Financial literacy is like any other learning, an ongoing process, yet I am aware of several sources for that education. I have watched and been instructed by my parents over the years in financial matters. I have also used other tools to become financially literate. I have taken classes for credit, participated in the family budget plan, and joined the credit union’s Foolproof program which informs people about wise money management. As a high school senior, I am currently enrolled in an economics class. This class has helped me to see the larger picture of trade and economy. The knowledge of supply and demand can build an awareness of prices and interest rates. As an online student I have taken a college math class that included practical aspects of money management. It addressed debt and interest rates. I learned about compounding interest and loan rates. By taking this class, I feel prepared to navigate the loan process, first to finance my education and in the future to help me with my dreams of owning a home. It is my goal to avoid the overload of debt. The instruction also informed me of evaluating loans and their offers. Because the credit union was founded on service, I know that the interest rates for loans will be more reasonable for a working person than at any other financial institution. I have seen the benefits of membership in action. My brother, who is newly married and living out of state, was able to secure a newer vehicle based on the benefits of membership to the credit union. I am certain these benefits will be availed to me exactly when I need them. My participation in the family budget process has prepared and execution has prepared me to live under my means. A budget allows one to see all income and expenditures in compact form. Budgets do change with increases in income or expenditure but should never be consistently in the negative of the income. Savings built in to the budget allows for rare fluctuations. A budget will allow me to save for the future and for unforeseen expenditures such as car repair. I have investigated that my credit union has a feature called my Dashboard which allows me to plug in my income and expenditures to manage my cash flow. To figure out how to navigate all the decisions about money presented in our media, I have used my credit union’s Foolproof program. The credit union is dedicated to financial education and the Foolproof program has helped me to learn the tricks used in our culture to trap young people. Advertising offers of fast money, the dangers of credit cards and the importance of sound financial decisions are clearly explained. So many young people enter the world unprepared to manage money. My classmates seem woefully unprepared to handle money and are in need of education. Education is clearly the way to be better prepared, and banks do not offer these types of opportunities. I am thankful for the credit union for taking an interest in my family by suggesting that I apply for this scholarship, for providing opportunities to manage my money, and giving me the education I need to be financially successful in the future. I am confident that I can search any financial topic on my credit union web site and receive resources to help me understand it. This ensures my continuing education in financial matters. My goal for my future is to avoid the burden of crushing debt. The independent steps I have taken and the services provided by the credit union have given me a unique advantage toward reaching my goal. 2014 Scholarship-Earning Essays What can you do to help yourself become financially literate? Winning Essay # 2 As a college student with only one year standing between me and entering the “real world”, I know that I will soon be faced with a host of new responsibilities and decisions. Many of these choices will pertain to my own personal finances – making it now more important than ever for me to build a strong foundation in my financial knowledge. Although finances can seem overwhelming to those with little personal experience in handling their own expenses, there are countless resources readily available to assist anyone in improving their understanding of the financial world. By becoming financially educated at a young age, one can ultimately increase the likelihood that they will benefit from financial stability throughout his or her life. One of the best resources for improving my financial knowledge rests in the various career and finance offices found on my school’s campus. Throughout the year, different institutions offer seminars and workshops to improve students’ financial understandings and to prepare students for future financial obligations. The financial aid office also provides information on funding college education, handling student loans, and much more. The office has even developed a pilot program with the goal of improving financial literacy among students through educational courses on a variety of financial topics. The office’s website also includes links to many other informative sites that include matters such as creating budgets, tips for raising credit scores, and how to manage money and debt. All of these helpful resources are readily available for me, making it easy to become financially educated and successful. While away from my college’s campus, I can continue to improve my financial literacy by utilizing the resources found through my own personal credit union. In the past, I have taken advantage of my credit union’s knowledgeable employees by asking them numerous questions about my personal finances and financial plan. I think it’s safe to say that all of these employees have far more experience in handling financial matters than myself and are therefore able to offer valuable advice. I have learned that it is always best to ask questions first, no matter how seemingly insignificant, so as to avoid future mistakes or confusion. My credit union also provides informative online resources, including financial tools and answers to common questions. If I have exhausted the resources available at my college and credit union, I can always turn to the Internet for advice. A simple Google search of “financial literacy tips” pulls up millions of results – ranging in sources from reputable organizations to anonymous bloggers. The Internet is full of people wanting to give financial advice. While not all of these people may have the necessary credentials for dishing out financial tips, I can improve my financial literacy by critically sorting through the available materials. In my opinion, some financial concepts are confusing when explained verbally, so online sources that include images and video can help me to better understand these ideas through the use of diagrams and other imagery. The Internet also provides the benefit of reflecting the most up-to-date information and advice in regards to financial matters. Furthermore, I can easily find the answers to specific or minute questions through a simple search on a search engine, making the process of improving my financial literacy easy and convenient. The final strategy I can use to improve my financial understanding involves two of the smartest people I know: my parents. While growing up involves gaining more independence from your immediate family, I believe that in the case of financial decisions, involving your parents or other family members often proves to be beneficial. My parents have extensive experience in handling financial situations and developing stable systems of personal finances. They can educate me on how to use a credit card and maintain a good credit score and when I should use loans and how to invest in stocks. I can also learn from their financial mistakes and make my personal financial plan stronger through their advice. In order to improve my financial literacy to my fullest potential, I should use a variety of resources to gain a comprehensive understanding of the financial world and how it works. I should never hesitate to ask questions and I should take initiative in becoming educated on matters regarding my own personal finances. With some hard work and determination, I know that I can improve my financial understanding with the help of all of these useful resources and materials. 2014 Scholarship-Earning Essays What can you do to help yourself become financially literate? Winning Essay # 5 One of the most import skills in today’s time and age is the ability to understand and manage money. Just 13 years ago, I remember the distinct feeling and smell of holding my entire paycheck in my hand. I'm not talking about the one piece of paper that you take into the bank, but that green stuff called cash. Now, I have no idea what my paycheck feels like. It's nothing but digits in an account somewhere out there. Unlike before where I regularly used physical cash, now things have gotten a little more complex as transactions are digital and invisible. Since transactions rarely involve physical cash these days, people easily spend thousands of dollars a month without actually feeling it. That’s a little scary to me, because not only do you need to be concerned with keeping track of your check, but you also need to understand a little about cyber security to protect against theft. To handle all of these complexities around money, I have taken the initiative to learn a little bit about financial literacy. One way that I have educated myself is by taking classes that teach me about financial math. In a personal finance class I learned about mortgages, budgets, and investing. To have some fun, in my spare time I found games such as the one offered by Investopedia that teaches you how to make calculated decisions when each path will require loss. Hungry to understand interest, I read multiple articles on understanding ordinary annuities and annuities due. To better get a grasp of my retirement account, I requested to meet privately with a reprehensive from the financial company holding my account to learn about the different ways I could invest my money. The hardest disciplines that I’ve found are spending on a budget, practicing long-term growth, and controlled spending on credit. One of the ways that I learned about properly using a credit card is by listening to experts who tell you to only spend what you can pay off by the end of the billing cycle. Practicing this has increased my credit score. Getting good at this, I’ve been able to take advantage of cash back deals and use those benefits as a separate savings account. I used to think credit was evil, through educating myself by researching different cards and benefits, I’ve learned that it’s important to keep in mind that you have to pay back what you spend, and that shopping around for a card is important before signing up. Needing to keep track of my household spending, I found a free open source accounting program that allows me to keep track of all of my monthly expenses as well as checking and savings accounts. This has allowed me to keep a watchful eye on the inflows and outflows of my income. I spent some quality time reading the online manual and learning about important accounting terms. This software has been a useful tool in helping me manage my household budget. Lastly, I learned about the importance of understanding the different benefits each financial institution has. After researching about banks and credit unions, I decided to open long-term savings accounts in two credit unions because I know my money will be safe. What’s great about credit unions is that you don’t have to worry about random fees or hidden fees. Just as important, I was able to take advantage of low interest rate auto loans. Because credit unions are smaller and can focus on the customer more than traditional banks, many offer seminars that teach on important subjects such as identity theft, managing credit cards, and how to budget. To better educate myself more on credit unions, I can visit the NCUA website to research any credit union in the nation as well as take advantage of the wealth of information offered on their website. I have outlined the many different ways that I have educated myself to improve my financial literacy. Managing money is no longer just about learning how to balance your checkbook. To be financially literate, you must also learn about cyber security and how to safely spend your money without risking the chance of theft in today’s Internet dependent world. I also pointed out the importance of researching financial institutions and taking advantage of their educational resources. Due to the plethora of these resources available, I am confident that I will be able to continually improve my financial literacy skills. 2014 Scholarship-Earning Essays What can you do to help yourself become financially literate? Winning Essay # 6 There are numerous resources available to help college students become financially literate. The most valuable to me, up until this point, has been taking the Personal Finance course that my university offers. It was taught by one of the Accounting and Finance professors and covered topics such as budgeting, automobile and home purchases, investing, career planning, taxes, banking, insurance, and managing credit. I even kept my textbook so that I can refer to it as my life continues. A rather easy thing that makes a big difference is to start reading articles relating to business and finance. Purchase a financial journal, peruse through the library's subscriptions, or simply scan the newspaper headlines. Whether the content covers the day's stock market changes, events related to specific companies such as mergers or fraud, or new government regulations, everything helps to familiarize oneself with the vocabulary, practices, and mindsets of the financial environment. At first it can all seem very daunting, but it does not take long for things to become clear. Another great method to increase financial literacy is to speak with adults and gain from their years of experience navigating the financial world. Parents, grandparents, professors, employers, local business owners, and others are often ready and willing to share their knowledge and impressed by an active desire to learn about a difficult topic. Ask them questions about a bewildering concept, for their opinions on current financial events, or, if they are willing, to share a bit of their own financial history. Often college students are completely unaware of the true cost of living, as they may live in campus- provided housing or at home, eat in their school's cafeteria, and mostly make discretional purchases. A great thing to do is to start researching what a normal budget would be for a young professional. Find out what it costs to buy or rent a home in the city where you would like to live. As far as transportation goes, compare the costs of gasoline and auto maintenance to using the public transport system. Consider expenses such as food, insurance, entertainment, and loan repayments. If one already knows what to expect ahead of time, there will be less shock and stress when the time comes to actually start making these purchases. An eye-opening exercise that I have done is to track every expense for a given period of time, be it just for a week or a couple of months. When I saw how much I spent on different types of expenses, it showed me what I hold to be more important, that is, what I am willing to spend more money on. It also can alert one to the fact that they have been spending a lot of money on something they do not really care for. In a society where credit cards are used for everything, it can be surprising to see how much little, spur-of-the-moment purchases can really add up. This also helps to create a realistic budget, as one's history of spending in certain areas is readily available. Attaining financial literacy may appear to be an insurmountable goal, but with time and determination it is easily achievable. Take classes offered by your school and start familiarizing yourself with financial literature. Discuss the topic with experienced adults and get to know your personal situation by discovering the price of your desired lifestyle and your current spending habits. Before you know it, you will navigate the financial world with ease. 2014 Scholarship-Earning Essays What can you do to help yourself become financially literate? Winning Essay # 7 What can you do to help yourself become financially literate? But what does it mean to be financially literate? Financial literacy is basically the skills and knowledge that allows someone to make logical, informed decisions about their financial resources. You also have to understand that finances are a tool to be used that can enable independence, security, the ability to help others, and a way to educate. So how do you learn this? There are the simple ways that anyone could learn to be financially literate, like taking finance classes or asking financial advisors for their insights / recommended reading. These two things would give anyone the basic knowledge to help them make educated decisions about their financial goals. I first learned about finances when I took an accounting course in my junior year of high school. We learned about the basics of finances and their applications. One of the class projects was running a virtual store using our knowledge of finances to earn a profit and stay in business longer than the others. For that we had to know things like budgeting, production and overhead costs, pricing, and inventory/ stocking. We also learned about assets and expenses in the business world and how they relate to personal finances. One other financial experience I have had is setting up my savings and checking accounts and putting money into them. But where, a bank or a credit union? A credit union was more the reasonable choice for me since I was just starting. Why? Because they have lower costs for their services, had convenient hours, and plenty of outreach / materials that I found helpful. I set up my checking and savings to better manage my monthly expenses and to save for the purchase of a car. My only income early on came from Christmas and birthday gifts, and then I started working at McDonalds and really started learning about things like: taxes (State and Federal), returns, social security, cash inflow and cash outflow. How little one could make and how fast it disappeared. I am only making about $7.80 an hour and it is gone as soon as I cash the check it seems. As I started a new chapter in my life at Carroll Community College, I wanted to expand on my financial understanding and follow the advice from my Dad. He provided some guidance about graduating both 2 year and 4 year degree programs with little to no college debt and to enter the professional workforce with a freedom that being debt free would allow. Recently I took a financial course and got a better understanding of what I had learned back in high school. We still went over the basics: assets, expenses, cash flow, etc., but we took views on personal as well as business financial situations in this course. There I learned more about specific investments like mutual funds, bonds, and stocks and the pros and cons of each one. For example, bonds steadily increase in value over time, but they have to sit for set amount of time or there is a fee for using it early. One of the most important things we did in the course was learn to set goals and retirement planning. They were important to me because I had not heard of either one in my high school class, only through what my parents had explained. Setting aside funds for retirement now seemed ridiculous to me but after seeing some of the problems people face I am looking forward to starting a long-term slow growth retirement plan as my finances and college expenses allow. My parents made a point of telling me to pay myself first, to make sure I save and invest as my financial maturity grows. Now how do I use finances as tools? Currently I use my extra finances for: maintenance on my car (gas, parts, and the insurance), entertainment (books, music, and games), phone bill, and charities/projects. In the near future when I am on my own, I plan on using my finances for rent, insurance(s), furniture, and food. Hopefully way down the road I will be able to finance my own home, family, college accounts for any kids, and finally my own retirement. Now all that is just the knowledge part of financial literacy, but knowledge is not everything. Financial literacy is also the skills or abilities needed to make the decisions. These skills come with time and repetition, but what are the skills in financial literacy? Some of these skills might be: patience, stress tolerance, and planning. Why patience? Patience is needed because almost everything in finances is volatile. When dealing with investments, you have to be patient and wait for things to get better, but you also can not be too patient and know when to let it go (planning for such). Now where does stress tolerance come into play? Stress tolerance because again financial investments are volatile and can fluctuate drastically. So you have to decide your investments on how much stress you can handle watching the stock prices skyrocket and then sink so low again and again. So financial literacy is many things and is important to gain success living happily in this era. It can be learned and practiced thru out life, it is used to get what we need, what we would like and to aid us in helping others. Being financially literate and using that knowledge is as important as the collage education that will enable me to earn the funds to use that knowledge.