Freidman: What college teaches you about money

Posted on April 14, 2014 in Perspectives
By masonfriedman

Given the plethora of articles written about the present circumstances surrounding the average college student’s financial security and future. In the wake of on-campus protests, I would like to take this opportunity to address the fiscal lessons I have learned while attempting to achieve a higher education.

1) Return on investment

This is a concept that is ever-present in higher education. As tuition increases, the average minimum wage salary can just barely keep up, and most students are forced to take out student loans. The ultimate result is debt, large, never-ending, ever present debt.

What return of investment means is that as a student, one must consider their choice of concentration and projected career along with the cost of completing a degree. In short, it seems students should now be well versed in divinations in order to figure out whether or not they will live the rest of their lives crippled by debt, or if they will manage to find a job in a limited market that can pay off their investment. This is a welcome change to a generation that grew up on the Harry Potter series. If only magic were actually real and we could see the future with enough clarity to know that we might be able to live unencumbered by perpetually low credit scores. This is, of course, all rendered moot, considering we will never be able to retire anyway. There isn’t enough Social Security for that.

2) How to run a non-profit like a business

Most universities, including USM, are non-profit organizations. These institutions rely on taxes (in the instance of state universities), grants, or the generosity of alumni. It has come to the attention of the world, as a result of the retrenchment protests, that our administration believes our school should be run as a business.

As most students understand, because they are working low-paying jobs to afford one credit hour per semester, a business has to keep its consumer in mind in order to run efficiently and keep growing. This, of course, explains why USM has also chosen to do away with archaic tenure positions that don’t hold professors accountable for the quality of product they are providing. This also explains why they have decided to hold onto their younger dynamic staff members who have no seniority.

So, remember, when you are next taking a customer service survey for the school, be sure to voice your opinion about that one professor who could care less whether or not you graduate, because their job is secure.

3) Other forms of financial bondage

If you decide to take a class, remember that you have two weeks–including snow days and random public holidays– to figure out whether or not your professor is insufferable or having a bad day.

After that, you still owe the school half of your enrollment fee, because they may have presented you with an inferior product, but that’s why most poorly-made items don’t come with a warranty. This is Wal-Mart after all, or not. No, that’s just where you will be working as you attempt to beat back your student loans. The ones you took out to attend a school or a business. No, wait, a school business? This is confusing now. Just remember, the resale value of your books is not even half what you paid. They’re like a car that you can’t even drive after four months. Practical.

4) Maximizing your tax credit

In order to get financial aid, you must also file your taxes. When doing this, you can increase your tax credit by attending school. This is great, but it doesn’t mean it’s time to go out and buy a new pair of shoes. The ones you have duct-taped can still keep the snow out, and the money needs to go toward food or school or rent or breathing.

What’s crucial to remember is that the money that you get back from the federal government might just be enough to keep your head above water for a weekend or two.

5) The importance of health on wealth

Studies have shown that a student working an average minimum wage job needs to work a 48-hour week in order to pay for the average cost of one credit hour. This does not include the amount of time it takes to study for each class (which is often quoted as three hours for every hour in class), and daily tasks like sleep, one must perform in order to live.

If a student is lucky enough to attend school in good physical condition, there is a high likelihood that they will leave worse for the wear.

In the instance of a student that is already combating an illness, this means they are paying off crippling healthcare debt and managing a job, doctor’s appointments, and that one professor who thinks this generation is soft because they have so many issues that just didn’t used to exist. Regardless, without one’s health, there is no potential for wealth.