Need help for revising a blog

Have you ever been pressured to go to college? Parents, friends, teachers, guidance counselors, etc all drilled into you that after high school you go to college. It’s just what you do. Almost everybody I knew who graduated within a few years after never got to use their degree. Regardless of your major or grades the job market just didn’t want to hire inexperienced recent college grads. Sometimes people with high school degrees make more than most people I know with bachelor’s or master’s degrees.

I had a friend who went to a prestige University and ended up with a debt of $30,000. He majors in Nano-engineering and graduated in June 2018. He had been trying to find a job for six months and had applied everywhere he saw available. In the end, he accepted a job as a lab assistant in University for $15 dollar an hour. His $30,000 debt is building in interest, he living on his own and must pay for his essential needs. $15 an hour is not enough especially when he lived in California. His return for his degree would not pay him back until probably in his late 30s.

The situation with my friend is not at bad as more than 2.5 million student loan borrowers have student loan debt greater than $100,000, with 610,000 of that total holding student loan debt greater than $200,000. So why should I go to college??

I am not telling people to not go to college or not get a degree but I am trying to teach people how to be financially literate. Many people are going to college for degrees that are not making much or has a high unemployment rate. I am not saying to not follow your dreams, but the reality is we need money to support our daily lives and start a family in the future. Bachelor’s Degrees such as arts major or psychology has a huge unemployment rate. The average income is average to below average. Include this with huge student debt that people must pay for the rest of their lives. What can we do?

· Meet the middle ground, find a job that you enjoy but can provide for you financially.

· Do your research, find jobs with low employment rate and huge job opening

· Go to community college your first two years and then transfer to the University. This will save you a lot of money since the classes taken during that time is almost the same as a University. You are basically paying more for the same classes.

· Take summer and winter classes, shorting your college years will save you money and allowed you to make money sooner.

· Apply for scholarships and Financial aids.

· Talk to older people in college, knowledge is valuable especially from someone much older than you. They can tell you what they went through at your age. It is priceless.

Your parents may have told you to save money giving you a chance for early retirement; however, that is wrong. While saving money for a rainy is true, keeping more than one year of rent is a waste of money. You are actually losing money, and each year your dollar becomes worthless. Think about this a house in California during the 80s was probably 100 to 180 grand. That same house in today market is probably 600 grand or more. Did the house change or what? No, what happens was your dollar not keeping up with inflation. This means your money is probably losing 2 % or more every year. The 20 grand now could be worth $2000 in twenty years.

Here is what you can do to counter that.

· Stop saving cash in your house. That money is not growing for you, and that money will keep on losing money.

· You can still save, but just save up to six months to one year of rent. (in case you lose your job)

· Start a high-interest saving and checking account. The major banks right now are only giving an interest rate of 0.01%. That is nothing and is behind on inflation. Usually, you can go to a nearby credit union who will provide a better interest rate of 1-3 percent. You can also try an online bank like “Ally,” which give a rate of 2.25% saving account. Another online bank would be, “Marcus by Goldman Sachs” which is also competitive with “Ally.” FYI, I am not affiliated with either bank.

· Start a Roth Ira, which is a tax advantage retirement account. As of 2019, IRA contributions are limited to $6,000 a year (up from $5,500 in 2018), or $7,000 if you are age 50 or over (due to an extra $1,000 allowed via a catch-up contribution). If $6,000 is invested annually in an IRA at a return of 5% after 30 years, the account would be worth over $400,000. Here is recommendation vanguard ira account or fidelity Ira. Both would not steer you wrong.

· Start an investment account. Make your money work for you. Investing in stocks today are more accessible than ever before. If you invest in an S&P 500 index funds or equivalent ETF, the average return is 8 percent. You may ask what an S&P 500 funds is, it is basically one stock that holds the top 500 holding of the market. This means you are diversifying your investment with a low risk for an 8 percent return. If you want to be riskier invest in single stocks that you believe may grow in the future. This requires a lot of research and is very high risk, but high reward. The return could be anywhere from 8 percent to hundreds of percent. My best investment was AMD, and the performance on that was 200 percent. Who knows you may get high returns as well. The overall stock market does crash once in a while, but if you buy and hold, it goes back up and beat inflation. Think about the 2008 market crash, many stocks were cheap around that time.

· An example is Apple stock which was 12 dollar then is now 200 dollars in 2019. That is almost a 20-times return, so 1000 dollar investment in 2008 is about 20 grand now. Why cause Apple is doing really well, and their phones are getting expensive each year cause the dollar is becoming less and less valuable.