Finance 101: AAU Financial Counselor Offers Practical Advice to Students

On September 16, 2024, a seminar titled Finance 101: Budgeting & Saving was conducted at Anglo-American University (AAU) by Financial Aid Counselor Drake C. Dewey. The event, aimed at helping students take control of their financial future, addressed key topics like budgeting, saving, avoiding debt, and investing. 

At the outset, Dewey identified the importance of creating a budget that would allow students to break down their spending clearly and give them a solid foundation for managing their finances. To this end, he offered some simple ways for students with no prior experience and limited resources to begin budgeting effectively, along with suggestions on free budget creation tools.

Dewey asserted the need for students to draw a clearly-defined line between their needs and wants—a concept that may prove challenging for some to navigate. To aid in making this distinction and in defining what is truly essential, he encouraged participants to focus on stable expenses like tuition, housing, food, and transportation when creating their budget.

“It depends what a student’s needs vs wants are, but the most stable costs should be inputted…The potential for mistakes could occur when a want is classified as a need when it really isn’t,” Dewey said. 

For students juggling part-time jobs or freelance work, Drake recognized that managing a limited or fluctuating income can be tricky. In circumstances such as these, he recommended establishing a baseline income first. 

“My advice would be to ensure [students] have a baseline of income. Freelance jobs might only offer a base salary or have special accommodations. These accommodations are what the student should put in their budget. For part-time, if there is a contract involved, then usually the figure is provided and is a stable one,” Dewey explained.

When it comes to saving money, Dewey shared some personal insights and recommendations, including his use of an Apple’s savings account, which, to advantage, offers a competitive annual percentage rate (APR). However, he encouraged students to go beyond just saving and begin exploring investing as a way to grow their money over time, citing examples from his own experience as a young investor.

“Savings are certainly worthwhile, but investments allow that wealth and financial management to grow much quicker,” he explained. “As a student…I would have 50 USD automatically come out [of my earnings] every two weeks for my savings and 25 USD automatically come out every month for my investments. So, each month I had 125 USD for future financial plans come out, and it really pushed me to work harder and manage my finances.”

Dewey said one of the most common and potentially serious financial mistakes he sees among students is mismanaging credit cards. He advised participants against using a credit card until such time as they fully understand its complexities and have the means to cover monthly payments, suggesting a a safer alternative.

“The best approach is to use a debit card until you have the capacity to pay and use a credit card. A debit card usually offers a savings account too and allows students to check their expenses much more easily,” said Dewey.

Contrasting short-term and long-term savings approaches, Dewey highlighted the key difference between the two lies in addressing the student’s immediate versus future needs. Short-term savings, which he defined as anything under a year, he said can be used for events like a concert or a planned trip, while long-term savings are better suited to major expenses such as buying a car or paying for an education.

Dewey also touched on the use of financial apps to help track one’s spending and manage one’s investments. For this purpose, he suggested those offered by Charles Schwab and Fidelity Investments in the US and Revolut in Europe, with Wells Fargo being his personal favorite.

The Finance 101 seminar took place as part of AAU’s Community Time initiative, a dedicated time slot between classes aimed at promoting engagement, fellowship, and a general esprit de corps across the university.

Students seeking further financial or looking for scholarship and financial aid opportunities at AAU may reach out to Dewey at drake.dewey@aauni.edu.