2009

Writing Contest: First Place

Money, Money, Money

Daniel James Welsh, Larry A. Ryle High School, Union, KY (Teacher: Sarah Meece)

Aside from the occasional movie and concert ticket, restaurant meal, and gas fill-up, I’m not the neediest of teenagers. Or am I? I’ve always claimed to be a wise spender, or rather, saver. But these past two high school years have truly tested my patience with investment. I’ve begun to understand why so many teenagers work every day after school and on weekends. They need the money! This income funds every teens’ social life, including mine. On average, over the course of a year, teenagers spend over $5,000, according to the High School Financial Planning Program Weekly Update (HSFPP). Fortunately, I’m too committed to my education to work during the school year. Nevertheless, I work in the summer, where the strong incentives of obtaining money on my own motivate me to do odd jobs for my parents and neighbors, such as babysit, clean and maintain pools, as well as uphold the title of “work area manager” as a shaved ice entrepreneur. Most of the money I’ve earned through these means has headed straight to my savings account, where I hope it will stay until I desperately need it. But sadly, “desperately needing it” might mean purchasing a concert ticket. Therefore, it is crucial for me to save, get my priorities in line, and rationalize spending with a utilitarian approach. In this way, I can steer clear of financial traps and stay smart with my money.

There are certain “necessities” for which I don’t have to pay. High school graduation, for instance, and the cap, gown, and announcements that go with it, are all paid for by my parents. But prom and homecoming tickets are up to me. And those aren’t exactly cheap, especially when buying for two. The tuxedo goes without saying. I earn a weekly allowance, usually no more than $20. I will admit, going out to eat and purchasing movie tickets is enticing, and I can’t always resist, especially with a large group of friends. After all, we teenagers think not going can damage our social reputations. But it is crucial for teens to balance income and expenses and consider opportunity costs, especially those who work part-time jobs. Only then will we have some money left over in our savings accounts.

Always, the best advice is to save. It is the only way to take charge of one’s budget, especially for a person in the teen-adult transition. Turning 18-years-old is a turning point, a reminder to be more active in how one spends and saves. This is exactly what I’ve done the past two years, having turned 18 only a few months ago. Moneywise, my junior and senior years have been for me, personally, quite easy to manage because I’ve effectively established and distinguished needs from wants. Although I only find myself jotting down an informal budget for certain expenses, my key to future economic success will no doubt be maintaining a record of what should and should not be purchased, along with monthly financial goals. “Just because you can” is not a valid rationale for buying something. According to the Nellie Mae Education Foundation, “Undergraduate college students are carrying credit cards in record numbers,” supported by the fact that “the percentage of students holding a least one card in 2001 has risen 24% since 1998.” As teens, we must not max out our credit cards – or use them at all if we can help it – but rather max out our savings accounts.

As a high school senior, I expect most of my college payments (tuition, room, and board) to come from merit scholarships, as well as several outside scholarships such as the one for which I now apply. Students like working adults, must spend wisely. Smart money-handlers question each purchase, asking themselves, “Do I really need this? Should I save instead?” For most teenagers, the answer to the first question is usually “no.” Instead of spending on clothing and gadgets that are already piling up in one’s room, one should save that money, and always with future consequences in mind. Next year, as I move into a first-year dormitory at a to-be-decided college or university, the last thing on my mind is what I need in my room. I don’t mind using the resources I already have at home to get by. Plus, I’ve already factored in my mom’s need to buy things that she thinks I won’t be able to live without. Either way, my standard of living in this case is mostly up to me, and I understand that it takes very little for most college freshmen to find a good standard.

What expenses come after tuition, room, and board? Food? Of course. Most colleges and universities use a meal card system, which students use much like a credit or debit card. Trust me; two of my siblings have gone away to college. The money adds up on those cards and the meals become fewer and fewer. Luckily for most freshman college students, especially those living in dormitories, free food is aplenty. But it most likely won’t meet the requirements for daily calorie intake or food pyramid servings. After that, it is entirely up to the student – or sometimes the parent – how leftover money should be spent. For many, this money buys one’s social life. I trust that I will find things to do on campus that require no payment. From what I’ve heard, free events occur on a more-than-weekly basis. My only hope is to not become overwhelmed by social opportunities that aren’t free. In this way, I can avoid the habit of spending rationalization, which in most cases, ends up in splurging.

I, like many other seniors, am ready to head off to college and “live on my own” in a sense – but still ultimately dependent upon my parents. Nonetheless, my economic success depends on the smart money habits I’ve set throughout high school and my ability to use those habits independently. Some decisions won’t be easy, especially if they involve attending a once-in-a-lifetime concert or sporting event. I must be able to trade off and save, as well as avoid the quicksand that is effective, persuasive marketing. I can learn something from my older sister, now a senior in college. She’s perfectly capable of splurging on things she wants, but she decides instead to save for things she needs. I hope I can follow in those same footsteps. Who knows when I’ll need the extra cash? To ensure the best standard of living, I must play a more active role in spending. Scratch that. Saving.

Composition has been lightly edited.