Mark Mielke, CFP ® Money Education (ME) Center Texas A&M University

Learning Now Will Reduce Stress Later Being financially literate can be a huge advantage for you – both personally and professionally. Big Factor 70% Financial stress is the most common cause of stress

Overview Understanding Your Federal Student Loans Balancing Academic & Financial Goals Setting Up an Easy Money Management System Different Ways to Budget Establishing a Credit History

Understanding Your Federal Student Loans Previous Student Loans Eligible for Deferment as Long as You’re at Least Half-Time in Degree Seeking Program Proof-of-Enrollment Can be Sent After 12 th Class Day Check NSLDS.ed.gov for Servicer(s) Unsubsidized Loans Accrue Interest You Can Always Make Pre-payments or Interest Only Payments

Balancing Academic & Financial Goals Academic Degree is the Gold Ring Financial Goals Need to be Determined Finances May Need to be Re-Allocated Accordingly Completing Academic Goals Probably Big Effect on Financial Goals

You are Your Best Investment

Setting Up an Easy Money Management System “Budgets aren’t straightjackets to keep you from spending your hard-earned money. Rather, they are the key to financial freedom, ensuring you have ENOUGH money to spend on what you want.” -Erin Burt, Kiplinger

Setting Up an Easy Money Management System Establish Financial Goals Determine source(s) of income Estimate monthly expenses Track all expenses for a month Analyze your expenses Establish a budget for each expense Don’t be afraid to make adjustments Achieve your Financial Goals!

Financial Goals Short Term Emergency Fund, Rent, Tuition & Fees Medium Term Paying Off Student Loans, Buying a Car Long Term Buying a Home, Retirement

Sources of Income Show Me The Money! Remember, income isn’t just from jobs – Financial Aid – Family – College Fund You can budget these sources just like normal income.

Estimated Graduate Resident COA (MBA and other programs will differ significantly) Resident Tuition & Fees $6,918 Loan Fees 152 Room & Board 10,626 Books and Supplies 920 Travel 2,404 Personal Expenses 4,630 Total$25,650

Fixed Expenses Same every month: Rent Cable/Internet Car Payment Insurance Goals/Emergency Fund

Variable Expenses Varies month-to-month : Entertainment Food – Dining Out Hair Cuts/Styling Clothes Birthday/Mother’s/ Father’s Day Gifts

Financial Quiz - Question 2 What is the cost of a cheeseburger, fries, and a drink at the College Station Cheddar’s? a)$9.80 b)$10.80 c)$11.80 d)$12.80 Cheeseburger - $6.29 Fries - $2.49 Soda - $2.09 Plus tax and tip

Financial Quiz - Question 2 What is the cost of a Grande Caramel Macchiato at the local Starbucks? a)$2.50 b)$3.00 c)$3.70 d)$4.30 $ $0.35 tax = $4.30

Save vs. Spend Example: Buy a coffee and breakfast every morning at the local coffee shop for a total of approximately $5.00. Month 1 - $150 Month 2 - $300 Month 3 - $450 Month 4 - $600 $600 spent on daily coffee …alone! $600 x 4 Semesters = $2400!

The Latte Factor “A latte spurned is a fortune earned” – People magazine What is a Latte Factor? –All unnecessary expenditures that you buy each month How do you find a Latte Factor? –Track your expenses –Am I buying too much of something? –Do I really need this item?

Latte Factor Examples

Different Ways to Budget Creating a Budget

Different Ways to Budget The type of budget you use is entirely up to you! Just make sure that it is: Understandable Easy Quick Doesn’t Eliminate All of the Fun Flexible Requires Discipline Right for You

Different Ways to Budget Method Monitor and restrict your expenses to totaling no more than the following of your after- tax income:

Different Ways to Budget The Envelope Method Write the name of your monthly expenses on separate envelopes. Determine how much money you want to spend next month on each type of expense and put that much cash in the corresponding envelope. If an envelope runs out of cash, you’re done spending on that expense for that month. Put all unspent cash into a savings account at the end of the month.

Different Ways to Budget Use Microsoft Excel This is one of the most common methods.

Different Ways to Budget Budget Online Several websites are available which allow students to track bank account, credit card, loan, and investment account information as well as help them to easily manage their money. –mint.com –money.strands.com –budgettracker.com

TitleURLInformation Mint Track your bank accounts, credit cards, investments, and loans graphically. Automatically tags expenses. * Before deciding which website to use, make sure that you look into all of the security information to make sure that you feel completely safe uploading your banking account information. Online Budgeting

TitleURLInformation Mint Track your bank accounts, credit cards, investments, and loans graphically. Automatically tags expenses. * Before deciding which website to use, make sure that you look into all of the security information to make sure that you feel completely safe uploading your banking account information. Online Budgeting

Budgeting Tips Establish an Emergency Fund Pay yourself first! Save 10-15% of your monthly income Prepare meals during weekend Potluck dinners with friends Don’t make impulse purchases Buy Generic brands Careful with paying for excessive services – i.e.. tanning or gym memberships

Establishing a Credit History Consider Obtaining a Credit Card Use it Sparingly (<10% of Credit Limit) Pay Off the Balance Each Month If You Can’t Use it Wisely, Don’t Get One Check Credit History at Least Annually – FICO Score Used Most Often

Thought for the Day The biggest barrier to becoming rich is living like you’re rich before you are. -Knight Kiplinger

The Money Wise Aggie FREE Individual counseling or group presentations available Money Management for Graduate Students Saving and Investing Credit Cards and Credit Scores Love and Money I’m Graduating: Now What? Eating Smart on a Budget Financing Your Study Abroad Buying a Car Car Maintenance Buying a Home Repaying Your Student Loans

SALT TM We have partnered with SALT TM to provide students with the following FREE online financial resources: Scholarship advice and resources Student loan repayment information Financial tools, videos, and information You can register for SALT TM now! Go to

The Money Education (ME) Center Scholarships & Financial Aid will be opening a fully staffed financial literacy center (the Money Education Center) in Fall 2016! The ME Center will provide: –One-on-One financial coaching –Student loan repayment and debt counseling –Money Wise Aggie Presentations –Personal assistance with budgeting and financial planning –Increased online resources

Money Education (ME) Center Scholarships & Financial Aid First Floor, The Pavilion (979) 845-SAVE (7283) us to join the Money Wise Monthly for monthly financial education tips. Web: moneywise.tamu.edu