How middle school students play the finance game – Marquette Wire

Renzo Silvera plays chess, but not with pawns. For Silvera, a senior at the College of Engineering, managing money in college is like this game of strategy.

“You have to see who your opponent is,” said Silvera. “In this case, it’s the financial system. And then, instead of just looking ahead, try looking five or more steps forward. ”

Silvera speaks from experience and easily lists the books of self-made millionaires: When he was ten, his family moved from his home country of Peru to San Jose, Calif., Which borders entrepreneurial Silicon Valley. Soon after, his parents introduced him to the concept of personal financial management.

“They just let me do it on my own,” said Silvera. “Since I was 17, I haven’t asked them anything.”

So when it came to college, Silvera knew the numbers game. Thanks to external, private scholarships, institutional grants and savings on the one hand, he says he was able to avoid taking on student debt. In his second year and first year he became a resident assistant and saved money that way as well.

“It’s a big advantage, for sure. Instead of paying loans, I can use it for investments that can pay off, ”says Silvera.

But for many other students, grappling with the financial system alone is scary, and budgeting bills can be a mind-boggling process. In addition to accumulating large debts, day-to-day money management remains the most formidable challenge, with nearly half (47%) of students saying they don’t feel ready to do it, according to one. 2019 survey conducted by EVERFI, an organization focused on social inequalities within the American education system.

“It’s a tough game,” said Silvera. “It’s very complicated.”

Spend Go and collect loans

The EVERFI report, entitled “Money matters on campus,”Also found that while six in ten students have taken out or intend to take out loans to cover their tuition fees, only 65% ​​plan to repay them on time or in full.

These trends are a source of concern for some professors at Marquette University, one of whom shared his own struggles at school.

“When I was in college, my dinner was microwave popcorn with Parmesan,” says Lora Reinholz, finance professor and Marquette alumnus. “I was so broke, in my last semester I worked part time because it was cheaper than full time.

Reinholz has taken out thousands of student loans, recalls finding campus groceries too expensive, and in the 1980s and 2021s she says students are asking the same questions: “‘How will I repay my student loans in addition to my rental insurance, my transportation, my food? Will I ever buy new clothes, hang out with my friends, or travel to see my parents? ”

When Taylor Morant, an elder from the College of Communication, arrived on campus as a commuting first-generation student, she was wondering some of these questions, especially about her tuition coverage. Because her mother had turned to student loans to fund her high school education, it was an option Morant herself took, she says.

“I don’t know if there will be a time when I stop paying off college loans,” Morant says. “So far, I have taken out a loan every year. “

According to Pew Research Center: “About two-thirds (65%) of first-generation college graduates owe at least $ 25,000 or more, compared to 57% of second-generation college graduates.

But whether or not they are in first-generation status, students from various economic backgrounds do not feel prepared to responsibly manage student loans, Reinholz explains.

“There are students walking around with over $ 100,000 in debt, which is really scary,” she says.

Over the past decade, student loan debt has grown 107%, according to an analysis by Federal Reserve figures from CNBC News. Today, nearly 44 million Americans have accumulated nearly $ 1.7 trillion in student debt, with the average total student debt standing at $ 30,000, per US news data.

Second draw: Financial health and emotional health

Stress levels rise in college students when it comes to managing their money, as financial health and emotional health are so closely linked, Reinholz explains. And according to EVERFI’s 2019 financial survey, the three highest stress points are: fear of rising tuition fees, having enough money to last the semester, and getting a job afterwards. graduation.

There has been no increase in Marquette’s tuition fees for 2021-2022 because the rates are set by the board of directors after examining certain costs. According to the school’s website, 46% of the tuition fee is used for the remuneration of professors and staff, 27% is used for scholarships and 16% is used for student support. The remaining 11% goes to installation and administrative services.

So, without worrying about an increase in tuition fees, the two highest stress points are having enough money to last the semester and getting a job after graduation, says Morant.

“I have savings, but they are dwindling rapidly. There is always something wrong, ”says Morant.

Like his broken down car, for example.

So that she can have enough money for the semester, Morant goes to campus and works two part-time jobs at Marquette. And while auto repairs are a necessary expense, such surprises eat into his wallet savings.

And because of his two part-time jobs, Morant feels that she cannot afford to take an unpaid internship, even though it could be beneficial for her career: 90% of university graduates who have done internships more likely to receive job offers than graduates who did not, according to an analysis of data from a National Association of Colleges and Employers (NACE) survey by WIRED.

“I don’t know if I’m going to get a job in journalism,” Morant says.

But Morant is not alone. For Vanessa Morales, a junior at the College of Arts and Sciences who is also a first-generation student, these stress points can distract from classes at the university. She says she feels like she had to choose between going to class and clocking in “a lot of times” because she needs to earn money.

This is a concern for professors like Reinholz, who says that if students in the class is stressed because it works too much, its main goal is not necessarily to learn the material.

“Work helps you pay for things, but you really have to focus on school,” says Reinholz.

But as Morant and Morales say, focusing on school is difficult. For them, it’s a game of balancing risk and reward.

Risk and reward

But even with student debt and rising stress levels, evidence shows that having at least a bachelor’s degree pays off in the long run, as adults who have completed college tend to accumulate more wealth, according to Forbes.

Ian Gonzalez, vice president of finance at Marquette, echoes this sentiment.

“You can take out loans to pay for that degree, or you can take on additional jobs,” says Gonzalez. “Obviously it’s hard to get there, but I can tell you the end result is high. ”

While Reinholz echoes this sentiment, she says pain can impact students’ ability to stay engaged in their professional lives, which in turn impacts productivity and future pay.

In other words, she says, if the risk outweighs the reward, it’s important to seek help.

“We want the best for our children,” says Reinholz. “If you don’t tell anyone, no one will know. And if no one knows, how can we help? “

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