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College Days


Choosing a college or university need not be a life changing decision for most individuals. Naturally some students pride themselves in attending a specific school due to family ties, sports activities or if all else fails because of the academic standing enjoyed by certain institutions. In my humble opinion, high school and college counselors should spend a little more time analyzing some of the local institutions such as community colleges and smaller four year state institutions.

Why would I choose a small institution over a large research institution? Usually this would depend upon my average high school grades, my financial status or my transportation options. More and more students returning to school after long absences find the small local institutions offer more flexibility in their scheduling of classes. Often the staff and faculty are more empathetic toward working adults in smaller local institutions due to the large population of students falling into this category.

The main point to any of this is to look in your own back yard before you spend a lot of effort and money applying to and attending large colleges and universities that may be a long distance from your home. A great percentage of first year students arrive on campus full of vigor and wanting to immerse themselves in the entire college experience. More often than not the first quarter or semester removes all optimism regarding passing grades while spending most evening hours chasing after love interests and drinking oneself into oblivion. Living at home for at least the first year and attending a local Jr. College or 4 year institution could establish a base line for grades and behavior that would follow students to the next level. Once bad habits are established they are difficult to change even when the desire is present.

Like a lot of individuals I spent a many hours bending my elbow and being amazed at the transformation process that takes place with young females after midnight. Had I spent a little more time with the books and in class I might have found myself a little less stressed in midlife trying to make a living and supporting a family. The real world experience is best explained by one who has been through the same experience. In my case I was the first person in my immediate family to attend college and consequently my family had no idea as to the temptations to which I would be exposed.

When my children were deciding upon college one of them chose to go attend a college away from home. I made this promise to her. If you make less than a C in any subject you will come home and attend the local JR. College for 2 quarters. Her second quarter in college found her with 2 D’s and a C. True to our word her mother and I drove to her apartment, loaded up her belongings and took her home to a Jr. College as promised. She make A’s for 2 quarters and was allowed to go back to her previous life. Why do I relate this story? Because it is true and it worked for my family. Smaller institutions offer a lot of opportunity and one should hasten to take advantage of these before grades get totally out of hand.

By the way, my younger child decided to attend a local Jr. College for two years and afterward received a scholarship to a private Regional University. Normally, the tuition for the private school would have run me well over $20,000 a year (this was in the mid 90’s) but with her scholarship we only paid $3000 per quarter. Why am I a firm believer in local institutions? The previous two personal examples say it all for me.

Presently, I am fortunate to be employed as an instructor at a local 4 year state college. The majority of my students live within 20 miles of the college and are receiving a quality education at a reasonable cost. A majority of the professors and instructors in our business school have years of practical business experience and the class sizes are small enough for a lot of personal attention.

Should you be wrestling with a family member regarding where they should attend an institution of higher learning please do not overlook any local Jr. College or 4 year institution as you will do yourself and your family member an injustice. For the most part those attending college will get out what they put in and you do not have to mortgage the house and go into overwhelming debt to accomplish the goal.

Terry


Financial Education or The Lack thereof in The United States

A former client of mine loved the expression “You cannot cure stupid.”  This was not meant necessarily as a demeaning comment, the context in which it was used was to define mistakes made by individuals in his employ.  For example, stupid decisions were usually made by individuals who lacked the intellectual capacity to make an intelligent decision.   Ignorant decisions were usually made by those lacking information or lacking all of the facts.  In other words some individuals do not have the mental acuity to make good decisions while others make uninformed decisions. My client believed management should be able to know the difference in employees and use them according to their ability.  Not a bad philosophy in my opinion.

Now, what does any of this have to do with finance and education?  I believe the current financial crisis in our country is due in part to the same two terms, stupid or ignorant.  According to Forbes Magazine, consumer debt is currently at a seasonally adjusted rate of slightly over 2 Trillion. Yes, that is a T for Trillion, so you can add 12 zeros to the end of the two.  I have been told it would take around 30 years to count to one trillion.  I have no intention of finding out.  Revolving credit card debt averages slightly over $9,000 per household in the United States.  Fortunately my wife and I do not carry any credit card debt so we skew the average slightly.  Is all of this debt due to stupidity or to ignorance or a combination of both?

Having reached the age of maturity and growing weary of hauling laptop computers through airports, I took up instructing at a local 4 year institution a few years ago.  My classes are primarily freshman and sophomores and one of our projects involves determining payments and amortization schedules.  The project is straightforward and includes calculating payments for one used and one new vehicle at different interest rates and time periods.  We also include taking the difference in the two payments and investing in a savings account paying a fixed rate for five years.  The purpose of this exercise is to help students understand the power of interest over time and dollar amounts and to show how investing on a regular basis can increase ones wealth at a surprising rate.  The sad part of this exercise includes comments from students such as: What do you mean by taking the difference in two payments? What is a payment? Do I add the down payment into the amount financed” Why do I care about interest if I can afford the payment?  The list goes on.  Naturally, not all students have such a lack of knowledge regarding money and interest but the vast majority has no idea how the real world operates.  I might add that over 90% of my students own at least one credit card and over 60% are not employed while in school.  Let me see; credit cards, no income, college student, entertainment, clothes, food and all the other necessities of a normal young adult.  Where does the money come from and when if ever will it be repaid?

Although we cannot assign blame to any one person, issue or circumstance we can do something to help the next generation of adults before they become victims of consumerism.  As adults we owe it to ourselves to help cure this problem.  Who will be burdened with this debt in the future?  All of us because those who default or simply cannot pay will force the debt to be written off or declare bankruptcy.  The young people of today will be responsible for paying the social security of those currently in their 40’s and 50’s and they need to be gainfully employed without the specter of overwhelming debt.

What can we do in addition to wringing our hands and singing the blues?  Demand of your legislators that basic finance be taught no later than the 10th grade in high school.  Demand of your legislators to stop the ease with which credit cards are issued by financial institutions and so called credit card repairers!  More importantly we all owe it to ourselves and to the younger generation to learn the pain associated with the yoke of heavy debt.  Credit cards can be very useful tools for traveling, avoiding carrying large amounts of cash and for identification but they are not and should not be meant to satisfy our need for immediate gratification.  Basic understanding of personal finances should not be brain surgery.

Terry


The following compilation of stories is based on true happenings. Some of the events may be slightly exaggerated but for the most part they really happened. The names may be changed to protect the innocent. Now there are a few stories from grammar school and high school that personify bubba but the true measure of a modern bubba is found in his college days. Ah college, the heady days when one learns that his bed need not be made up every day and that drinking beer any night of the week is accepted.  Going to class is an option and generally becoming involved in foolish and sometimes dangerous acts is commonplace.  The most memorable bubba I have ever know was an acquaintance of  mine during high school and once in college we were able to forge a friendship that has lasted for 4 decades.  (If I forgot to mention it Bubbas are loyal also.)  For the sake of saving a marriage and preserving some dignity I will refer to this individual as Jerome.    

Jerome and I managed to squeak by our freshman year in college with minor bouts of debauchery and alcohol abuse. Little did we realize we were in training for our sophomore and junior year?   One must keep in mind that the Vietnam War was in full swing and the military draft was alive and well.  For example in April of 1968 the total number of individuals drafted was 50,000.  The United States Marines were even taking draftees in 1968.  This was the largest draft since 1943-44.  The draft is important because the only way most of us stayed away from the draft was to make decent grades in college or as an alternative, get married and have a baby.  We were so young and stupid we envisioned the marrying and baby idea as worse than going to Vietnam.  A key comment in the prior sentence is the “decent grade” comment.  Now this seems like a fairly simple task.  All one must do is go to class and study enough to keep their young ass in school.  If this feat was accomplished then no worries concerning being shot at by some 5 foot oriental who was protecting his homeland. Fail to keep up your grades and it was “GOOoooood Mornin VietNam.”  We somehow managed to make it until spring quarter of our sophomore year before the reality of the real world set in.  (More on this later.)   

Fall quarter of our sophomore year.  Man what a great time.  I had a grade point average of about 1.7, my roommate had about the same and Jerome and the rest of our crowd had all achieved the sought after status of being drunk and stupid, but well liked by the student body, the local bartenders and some of our professors.  This distinction was not lost on my mother who often lamented that she hoped I saw her tears in the bottom of every beer that I drank. ( No, she is not Jewish but would have made a great Jewish mom.)   The art of assigning guilt was finely honed in our family and since I am an only child I managed to be on the receiving end more than the giving end.  After receiving my 1A status (eligible for the draft) she once told me that if I did not straighten up that I would go to Vietnam and end up coming home in a box.  Instead of feeling guilty I was now determined to prove her wrong.   Several circumstances during my sophomore year helped set the stage for my remaining college career.  One of these circumstances involved drinking beer at a local slop shoot, (a redneck bar).  Four of us, including Jerome, had ventured to an establishment we had named The Star.  The Star got its name from a beat up old fluorescent sign that was shaped like a Star.  This fine establishment would serve alcohol to anyone tall enough to reach the top of the counter and lay down some money.  The legal age in Georgia at the time was 21 and we were all between 18 and 19 with ID’s from various colleges that said we were 21, not that anyone at The Star every asked us for and ID.  Anyway after a few rounds of beers, the door to the bar opened up and one of our buddies said  “ohhh Sheeeit!  A neighbor from his home town over 220 miles away had dropped in for a cool one.  Upon seeing Mac, the neighbor came over and spoke to all of us and asked if we were having a good time prior to sitting down with his group.  Once the neighbor left our table Mac said, “Son of a Bitch.” And it was at that point that we knew were in deep kimchi.  As it turned out the neighbor was a state revenue agent and a great friend of Mac’s family.  During the dark ages of 1967 you could get into real trouble by drinking under aged and returning to the college campus drunk.   

A couple of more pitchers of the local draft beer took our minds off of the potential trouble we faced and once the locals arrived and cranked up the juke box we were all lost in the frivolity of the moment.  Hell, once we quaffed several beers we all were too tan, too tall, too smart and too good lookin.  We could do no wrong.  Then we screwed up big time.  We returned to campus to find the dean of men and his assistant waiting at the dorm steps for us.  When asked by the Dean if any of us were drunk Jerome spoke up, or rather the alcohol spoke and said “hell yes I am drunk and so are the rest of us.”  We did not receive double secret probation but social probation was tacked upon our records and believe it or not we were put on a curfew and relocated next to the dorm mother.  Our dorm mother was a closet wino and this turned out to be a great move.  More on that subject will appear in the next chapter. Life ain’t brain surgery but is sometimes more complicated. 

Bubba Terry