Stuff You Didn’t Learn in High School: Basic Personal Finance
Let’s start out this blog post with a quick quiz.
1. In creating a budget, what does the 50-30-20 Rule refer to?
- Spend 50% of your budget on needs, 30% on wants, and 20% on savings or debt.
- Aim to be debt-free by age 50. Aim to invest by age 30. Aim to save at age 20.
- Tax brackets: 50% tax rate if you make over $5m, 30% if you make over $500k, and 20% if you make less than $500k.
- You’ll make 50% more money over your lifetime with a Ph.D, 30% more with a master’s degree, and 20% more with an undergraduate degree than someone who has not attended college.
2. A good FICO® credit score range is generally considered to start at:
- 650
- 670
- 700
- 740
3. Approximately what percentage of college students are awarded some type of financial aid (grants, loans, scholarships, or paid employment)?
- 55%
- 65%
- 75%
- 85%
Know all the answers? Great! Don’t know any? THAT’S OKAY! As a college student, you’re only just starting out on your journey toward financial independence. Now is the perfect time to start building healthy financial habits that will help you throughout your life.
And that’s where the Financial Wellness Center can help! Miami offers this online platform filled with great information about everything from how to pay for college to how to establish your credit. Its interactive playlists give you the chance to learn at your own pace and explore subjects based on their interest to you.
Can you guess what the most popular playlist is among Miami students? Budget Hacks for College has been the most viewed playlist since the Financial Wellness Center’s inception. It covers how to use the 50-30-20 Rule to create a budget that will help you make the most of your time on campus.
This playlist is one of MANY that can help you start making smart financial decisions. To help you navigate the Financial Wellness Center’s wealth of knowledge, here’s an overview of its six sections.
1. Financing Higher Education: Learn about financing higher education, preparing for graduation, and beginning your career. Sample playlists include Financial Decisions for Your Career Path, Understanding Your Student Loans, and, yes, Budget Hacks for College.
2. The Basics: Take control of your finances by investigating where your money is coming from and going to. Popular playlists include Creating a Budget, Credit Cards, and Taxes.
3. Your Credit and You: Prepare yourself for life’s biggest moments by understanding how to build and maintain strong credit. Explore credit scores and reports, car loans, identity protection, and more.
4. Working World: Discover how you can make your money work for you, including by living a FIRE Lifestyle and by making career choices that benefit your earning potential.
5. Healthcare Finances: Learn about the U.S. healthcare system, including how to navigate medical bills, manage out-of-pocket costs, and leverage HSA accounts.
6. Building Financial Resilience: Explore how to overcome financial challenges by developing healthy habits, managing debt, and understanding inflation’s impact. Also discover how to identify social media scams and navigate uncertainty in the banking industry.
Remember, it’s okay not to have all the answers as a college student. Use this time to educate yourself not only in your field of study but also in how to build financial independence.
Before you check out the Financial Wellness Center for yourself, we thought you might want to review our quick quiz’s answer key:
1. The 50-30-20 Rule is a common method used to determine how to allocate your personal budget. It recommends you spend 50% of your budget on needs, 30% on wants, and 20% on savings or debts.
2. 670. Keep in mind different credit bureaus have their own thresholds. Your entire credit history, not only your credit score, may be taken into consideration when you apply for credit.
3 85%. Some types are needs-based while others are awarded on the basis of merit. You can learn more about the different kinds of financial aid by visiting the One Stop’s Funding Opportunities page.