Blog 7: Managing Future Income Risk
I am the first in my family to attend college and when it was time to select a college to attend, I did not get much help from family. I went to my advisor for advice on what college to attend and was given a book about the Colleges That Change Lives (CTCL), a group of colleges that focus on personalized and transformative college experience for their students. CTCL started as a book written by Loren Pope, retired New York Times education editor, journalist, student advocate, and independent college counselor, and is now a recognized non-profit around the nation. I was not one of those kids that knew exactly which college to attend, what I wanted to major in, and what I wanted to do as a job after graduating.
Choosing my first college was the first big financial decision I made. In my college search, I knew I wanted to go out of state because I wanted to see how I handled living away from family and at the time did not realize going out of state meant higher tuition costs as opposed to staying instate. I applied to several CTCL colleges and narrowed the choices down to two: Willamette University in Salem, Oregon or McDaniel College in Westminster, Maryland. Willamette costed twelve thousand out of pocket and McDaniel costed just over four thousand. I decided on attending Willamette because I was able to visit campus through a travel voucher and really liked what I saw while for McDaniel, I was only able to read online reviews of the college which involved a lot of drug use. My plan to pay for Willamette was to take out loans for the first year, which totaled to seventeen thousand in loans, and become a Resident Advisor (RA) for the remaining years. I ultimately was not selected to be an RA and had to transfer to a community college in Chicago. All I had to show for attending Willamette was seventeen thousand dollars of debt that I am still paying off today.
I am an Economics major now but was not always one. I went to Willamette as an undeclared student and over the course of the school year, I started liking math a lot more after taking precalculus, calculus 1, and calculus 2. I was seriously contemplating majoring in Mathematics because the analytical skills and concepts taught could be applied to a broad range of topics and more importantly useful when applying for jobs. Picking a major for me was never about whether I liked the topic, that was a bonus, but rather what jobs can I get after graduating.
I decided to become an Economics major after my first semester at UIUC. I took a math course that was an introduction to writing mathematical proofs. I absolutely hated the class and almost failed it. I did not want to put my GPA at risk, which would reduce the number of jobs I could apply to, so I decided to become an Economics major instead as I am still able to graduate within four years and there is a lot of overlap between the two majors.
I have worked over the school years and summers since starting college to pay for college and have a source of income. Through these jobs, I know I do not want any career in food or nonprofit work because they require a lot more work to be put in then what is paid out and in my opinion it is more difficult to get promotions, gain pay increases, and more restrictive when looking for jobs. I am considering going into data analytics or banking now because either fields are not labor intensive, has high pay and promotion potential, and looking for future jobs for higher pay likely would not be as difficult.
Choosing my first college was the first big financial decision I made. In my college search, I knew I wanted to go out of state because I wanted to see how I handled living away from family and at the time did not realize going out of state meant higher tuition costs as opposed to staying instate. I applied to several CTCL colleges and narrowed the choices down to two: Willamette University in Salem, Oregon or McDaniel College in Westminster, Maryland. Willamette costed twelve thousand out of pocket and McDaniel costed just over four thousand. I decided on attending Willamette because I was able to visit campus through a travel voucher and really liked what I saw while for McDaniel, I was only able to read online reviews of the college which involved a lot of drug use. My plan to pay for Willamette was to take out loans for the first year, which totaled to seventeen thousand in loans, and become a Resident Advisor (RA) for the remaining years. I ultimately was not selected to be an RA and had to transfer to a community college in Chicago. All I had to show for attending Willamette was seventeen thousand dollars of debt that I am still paying off today.
I am an Economics major now but was not always one. I went to Willamette as an undeclared student and over the course of the school year, I started liking math a lot more after taking precalculus, calculus 1, and calculus 2. I was seriously contemplating majoring in Mathematics because the analytical skills and concepts taught could be applied to a broad range of topics and more importantly useful when applying for jobs. Picking a major for me was never about whether I liked the topic, that was a bonus, but rather what jobs can I get after graduating.
I decided to become an Economics major after my first semester at UIUC. I took a math course that was an introduction to writing mathematical proofs. I absolutely hated the class and almost failed it. I did not want to put my GPA at risk, which would reduce the number of jobs I could apply to, so I decided to become an Economics major instead as I am still able to graduate within four years and there is a lot of overlap between the two majors.
I have worked over the school years and summers since starting college to pay for college and have a source of income. Through these jobs, I know I do not want any career in food or nonprofit work because they require a lot more work to be put in then what is paid out and in my opinion it is more difficult to get promotions, gain pay increases, and more restrictive when looking for jobs. I am considering going into data analytics or banking now because either fields are not labor intensive, has high pay and promotion potential, and looking for future jobs for higher pay likely would not be as difficult.
You used the prompt to write some autobiography about yourself, which is okay, but I wish you had done it more critically, meaning to ask questions about each juncture and to explain why that choice was made and not something else.
ReplyDeleteLet me illustrate. As you are the first in your family to attend college, was not attending considered seriously? Alternatively, did you think of working for a couple of years, building up a nest egg that way, and then attending college so you didn't have to accumulate as much debt.
Also, while you mentioned having an advisor to help you with college choice, did anyone help you with the financial issues you'd confront by attending college, and how you might manage those? In particular, I'm guessing that attending community college immediately after college would have been safer financially for you. It sounds like that possibility was not considered in your college choices, which were driven by the perceived benefits at the time, but possibly ignored the costs. For a wealthy student, that might make sense. In your case, however, it seems it should have mattered. So you might have explained why it didn't at the time.
Sometimes we take on risks inadvertently because we are not aware we're doing so at the time. I mentioned that in class about myself with regard to certain health risks. This can likewise be true about income risks. When this is the case, some education to raise awareness can be a risk reducing strategy.
Let me get at still a different issue. This is part time work during the regular semester, taking summer classes, and the time to degree. I wonder for you whether you've considered how many credit hours you take during the fall and spring as an issue for managing income risk. If you view tuition expenditure as something you'd like to control, graduating earlier might end up costing you less money, even if you do pay some tuition during the summer. (This is especially true if you take the summer classes elsewhere.) On the other hand, you do need some money to live on for room and board. Is there a better way to manage this and then less good ways to manage this? You talked about summer jobs, but you didn't consider the full picture this way. Might you have done that?
In other words, what I'm encouraging you to try is to get more depth in this post and in future posts. Some of that you can do in your response to this comment. But I'd like to see you try this for yourself before you get to read my comments. It will help you learn the economics better.
I never considered not attending college immediately after graduating high school. Going to college was just something that had to happen and I never considered delaying it by a couple of years to work or go into trade school as an alternative.
DeleteI decided to move away for college and gamble on being a RA to pay for the remaining years. I really liked Willamette and I learned a lot that year but at the same time I was constantly weighed down by the uncertainty of becoming an RA and not knowing how I was going to pay for college after the first year. Community college would have been more viable financially but I did not want to attend community college because I was told the class material and difficulty would not prepare me for actual college level difficulty courses. Once I transferred to community college, these claims that community college courses were easier were true. I put in a quarter of the amount of effort into my community college courses, compared to Willamette or UIUC, and got almost all As in both semesters while attending community college.
I have never considered taking on more courses in order to graduate earlier. After transferring to UIUC, I have had a full credit hour course load with second half semester courses and two summer courses. I would like to graduate earlier but I am struggling just keeping up with four courses and maintaining all other responsibilities in life including finding a job post graduation. I really do not want to handle more than 12 credit hours per semester for my own mental health and I have stressed myself out about academics since starting college with the exception of the year at community college.