Though several influences contribute to the nation facing significant financial challenges, the population’s lack of financial literacy is a factor often overlooked.
Tammy Mermelstein spoke at the second annual UH Bauer College Financial Symposium, which advocated financial literacy. | Aisha Bouderdaben/The Daily Cougar
Reva Zhao Azeez, Leonard Loyd, Donald Bowers, II, and Alfred Coleman were the panelists in the discussion about Careers in Finance and Financial Planning. | Aisha Bouderdaben/The Daily Cougar
The C.T. Bauer College of Business wishes to change that reality by providing students with useful resources and knowledge on a variety of financial topics through the annual Financial Symposium event held Saturday.
“The one thing we know about earning potential is that it doesn’t really matter how much money you make; it’s how much money you keep,” said Donald Bowers II, assistant vice president of the Federal Reserve Bank of Dallas – Houston Branch.
“This financial education program is all based upon trying to help people within our community better understand how to manage their resources, large arsenal and how to build wealth and retain assets.”
Bowers said the majority of people spend 80 percent of their time working to earn money, worrying about how to make more or spending. In addition, 13 percent of households in Texas do not have any type of bank account.
“That either means that they’re taking risks and saving money at home, or they’re just not saving any money at all,” Bowers said. “They’re trading off long-term financial stability to try to deal with short-term issues.”
Another issue in Texas regards student loans. Estimates are that 1 of every 5 young people who have student loans will default within the first 3 to 5 years after they are out of college.
“We need to fix that,” Bowers said. “We got to be better prepared and do things with intention. We want you to learn how to be intentional about your personal finances.”
Alexander Obregon, special projects coordinator for the office of the Houston City Controller, gave continuity to the discussion by addressing the city’s point of view.
“What’s your government’s interest in people having personal financial education?” Obregon said. “Well, we want you to be taxpayers, to be able to build wealth, pay property taxes and things like that. That’s a good thing because it means you have assets.”
Obregon said that the city of Houston worked in partnership with the Federal Deposit Insurance Corporation, the Federal Reserve, some banks and nonprofit organizations to start the Bank on Houston program in 2008, which is designed to bring the unbanked and the underbanked into the financial mainstream.
“We want you to know that the City of Houston, other government entities and Bauer are all taking invested interest in making sure that you have the financial tools to begin to be taxpayers, contribute to the University of Houston, provide for your family and yourself and, more importantly, to provide for the greater good of this population,” Obregon said.
Bauer worked with the Texas Council on Economic Education to come up with a Money Management Poster contest as an initiative to promote financial education in children from several district schools in the metropolitan area. TCEE President and CEO Laura Ewing honored the winners during Saturday’s event.
James Hong, president of the Bauer Alumni Association and founder of Hong Financial, closed the discussion by giving five tips on how to get started and be successful about achieving personal finance awareness.
Hong said the first step is to have a plan, set goals and stick to a budget. The next step is to have discipline. The third step is to take one step at a time because nothing happens overnight. Hong’s next tip stressed the importance of knowing the difference between “needs” and “wants.” He said people tend to follow trends because ours is a consumerist society, which can hugely affect personal finances. Lastly, he advised the audience to learn from others.
“It doesn’t take a millionaire to be a millionaire,” Hong said. “Use your resources, talent and academic knowledge to achieve your goals.”
Great article! Thank you for putting such effort in writing this. It’s so easy to understand even a high school student can get this. Looking forward for next post.