On Take It To The Bank,
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you'll find
ways to get out debt,
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solve your credit card problems,
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how to make in
stick with a budget,
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simple ways to save,
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buying or selling a home,
and many more finical matters
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on Take it to the Bank.
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Hi, my name is Cordell Thomas
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and welcome to
Take It To The Bank.
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We're going to talk about
some interesting things today.
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And I think you
should be excited
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to know that college debt
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is something you
don't even need to incur.
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Did you know that
there are colleges out there
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that offer free tuition?
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Did you know that
if you want to extend
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your college education
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or find college
education somewhere,
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if you know where to
look, you can find schools
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that are willing to
offer a variety of things?
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If you are good enough
in your high school days,
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there are things you can
get in reference to scholarships
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and other programs
that don't even address
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the issue of loans.
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Meaning that, this
college education thing
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can be accessible for all
of you that are out there.
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It's a matter of how you
address the specific issue.
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But as we talk about
this thing called debt,
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there's a lot of
things that you need to be
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aware of as you go
into this overall process,
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it can be quite stressful.
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You do well in high school,
you probably will be invited
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to many different schools.
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But those schools
are going to provide
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different costs
associated with tuition
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and room and board,
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and other elements
that can be as much as
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20 to 30, 000 dollars a year.
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So, it's very important,
it's incumbent upon you
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to look for those
resources that are available
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that can help defray that
cost or even get rid of it,
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eliminate it completely.
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But many people
aren't aware, there are close
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to 15 different schools
around the United States
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that are offering
free tuition programs
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that can make your educational
experience very wonderful
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when you know you won't
have to come out of college
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worried about the
issue called debt.
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Many kids, young people,
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I was able to talk to one around
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in the kitchen room
area after a birthday party
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and he was talking
about going to school.
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We mentioned these
same specific issues,
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we mentioned the same concerns
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about looking at free
tuition and or starting out
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maybe in a
community college settings
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until you figure out really
what area you're interested in.
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But many of us are so
worried about the college issue
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and the
importance of trying to pay
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for that type of education,
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and we forget the importance
of planning after the fact,
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because realistically,
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you're college education
is supposed to provide you
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the opportunity
to make more money.
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A college
education is very important.
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It teaches you many new things,
depending on where you go
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you can gain
fantastic opportunities
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to share, to serve.
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There are some
wonderful Christian institutions
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that provide
opportunities to go outside
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of the United States
and do mission projects
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and learn what it means to give.
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And it makes you happier
because we know that the study
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on happiness says that if
I can give to somebody else
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instead of spending on myself,
I am a happier individual.
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But consider
this, many young people
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like yourselves
will come out of college
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with close to 20,000
to 26, 000 dollars worth
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of student loan debt.
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And many of you
will come out of that
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undergraduate experience worried
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about paying that debt
back, which is very good.
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You should be concerned
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about taking care
of your obligations.
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But there are
areas you can go to
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and studies that
you can find out about
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that you can get rid
of your student loan debt
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if you go into public service.
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Did you know that?
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Did you know that
there are other ways
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of deferring the debt
for a few months or years?
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Did you know there are
other things you can do
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to help take care of that debt?
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And one of the things
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I always try to tell
young people is this,
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when you come out of school,
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I want you to start
looking forward in your life,
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start looking forward to
the next ten years of your life
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because right now
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when you think
about this eight wonder
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of the world is
what they call it,
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the rule of 72, it
means you have the time
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to actually invest and
that investment can help you
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because of the time
that you currently have.
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One of the secret
hints is talk to your parents
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about finding out
more about a Roth IRA
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or some type of investment
that you can get involved in.
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Why is that?
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Because if you are able to save
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after you get out of
school 150 dollars a month,
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2000 dollars a year
over the first ten years
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of your working life,
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you wouldn't have
to save another penny.
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That 20,000 dollars
based on your time investment
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on compound interest,
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you could have a lot
of funds available to you
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after retirement at age 70.
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But many of us don't
think that far ahead.
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The money could be in
excess of 5, 6, 700,000 dollars
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dependent on
several different variables.
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But the key is right now
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getting involved
when you have the time.
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Thereafter you can...
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Because you're in
the habit of saving,
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you can continue
the process of saving,
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you can continue the process
of doing what you're doing
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and putting that money aside
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and the funds that
you would have available
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to you post
retirement would be exponential.
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So we're talking
about student loans,
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we're talking about loans,
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loan deferral,
those type of issues.
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And I had a
wonderful conversation
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about that specific issue
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with one of our
financial advisors
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that we work
with in Orange County.
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Mr. Joshua Hernandez
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and I'd like to go
to that conversation.
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College debt is
relevant to a lot of us
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and you have been responding.
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It's quite interesting,
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the responses
we've got in emails.
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And I'm going to
focus on one email
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and, of course,
we're gonna bring in
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our expert on investments,
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financial expert
Mr. Joshua Hernandez
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thank you for being here.
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Sure. I appreciate it.
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The young lady
actually sent me an email.
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"So I'm a student presently
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and some loans
prior to in, two colleges,
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from two colleges I went to.
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And I noticed on the
firstforeducation.gov
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website, they are promoting
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a consolidation loan
through President Obama."
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Okay, so she's asking now
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I have loan debt right
now about 10,000 dollars
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and I'm looking to
go to graduate school.
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If you can take us a
little bit through the process
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of considering the decision
of getting another loan,
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consolidating the loans
that she already has together
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or is there another approach
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that she should
take in reference too
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her college debt?
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And then what I'd
like you to do also is
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how can she start thinking about
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not only the college debt
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is will come out
with when she's done,
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but planning for here
future long term in reference
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to investing and
savings and that type of thing?
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Great question.
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I'm not an expert in
types of college programs
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in terms of
consolidation and debt,
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but I can tell you about,
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maybe the thought
process in considering
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what will be the best scenario
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or what to start thinking about.
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I think specifically, I
read the email and there was,
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you know, part of that debt
can be 4 percent interest rate
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and then another part
of it was about 6 percent
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and so does that
make sense or you know
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how do you determine
what part of that works?
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And the first
thing I'd think about is,
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you know, what's
the interest rate
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that they're charging you now?
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Is the new interest
rate lower than that?
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Now if there's two
different loans involved,
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is the interest rate on
the first and the second,
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if you average them together,
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is that lower than
the current interest rate
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that you're getting
charged in your current loan?
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If you were to
switch over to another loan,
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is there a fee or
penalty to transfer over?
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So consider the
penalties involved as well.
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And then is there a timeframe?
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You know, how long you
can have this loan for?
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And when do you
have to pay it off?
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Another idea
that comes in mind is,
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you know, deferral you can,
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you can defer a
lot of these loans
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until you're done with school.
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And so maybe you
don't have to pay for it
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for a little while.
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One of the recommendations
that I offer college students
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is if you're
deferring your loan,
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you don't pay until you're out.
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Start saving money or
start paying off your loan
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now, even before you
have to start paying it.
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As an example, if they tell
you that when you start to...
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When you start
having to pay your loan
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and that payment is
100 dollars a month.
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If you can start
putting 100 dollars a month
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into your own savings account
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as if you're
paying off that loan.
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And then when you
have to pay for that loan,
00:09:04.51\00:09:06.11
well, you've already
got some money already,
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you can fund into it,
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and you immediately decreased
a portion of that debt.
00:09:08.88\00:09:12.28
Or you've got, you
know, monthly payments,
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you've already got
money putting into,
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couple of ideas.
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Fantastic.
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So as a college student,
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there are different
approaches I can take
00:09:20.89\00:09:22.72
specific to setting up a
saving account, number one,
00:09:22.76\00:09:26.09
which if you have the
concept of an emergency savings
00:09:26.13\00:09:29.30
as we typically talk about,
00:09:29.33\00:09:30.93
you can tap into it if
you have broken down a car,
00:09:30.97\00:09:34.17
you need to tap into
that to do other things.
00:09:34.20\00:09:36.50
But for the primary
issue of college debt,
00:09:36.54\00:09:39.27
which a lot of youth students
get involved in, we all do,
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I know I had college debt,
00:09:43.61\00:09:45.75
but there are
other opportunities too.
00:09:45.78\00:09:47.98
And those are the opportunities,
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what are they?
00:09:53.19\00:09:54.52
You know, tax deferred growth,
00:09:54.56\00:09:55.89
many other things
that come to mind,
00:09:55.92\00:09:57.26
but when you look at
the conversation we had,
00:09:57.29\00:09:59.29
many different
possibilities came to mind.
00:09:59.33\00:10:02.06
Think about it?
00:10:02.10\00:10:03.43
When you have an
opportunity to think ahead,
00:10:03.47\00:10:06.23
looking forward, we get a
concept of how we can plan,
00:10:06.27\00:10:10.17
better plan to manage
some of these expenses.
00:10:10.21\00:10:12.81
Do college loans,
student loans ever go away?
00:10:12.84\00:10:16.44
No, they will stay with
you and stay with your family
00:10:16.48\00:10:19.45
as long as you still have it.
00:10:19.48\00:10:21.28
So it's incumbent
upon you to figure a way
00:10:21.32\00:10:23.95
how you can begin the
process of paying this debt off,
00:10:23.99\00:10:28.22
whether it be
through public service,
00:10:28.26\00:10:30.43
by planning ahead and starting
to put certain funds away
00:10:30.46\00:10:34.03
into a specific account
that's needed to address that.
00:10:34.06\00:10:37.23
But guess what?
00:10:37.27\00:10:38.60
It comes down to a simple
issue that many of us miss,
00:10:38.63\00:10:41.37
what is that issue?
00:10:41.40\00:10:42.84
That issue is this.
00:10:42.87\00:10:44.51
If you don't plan,
you will never figure out
00:10:44.54\00:10:47.88
where you need to go.
00:10:47.91\00:10:49.24
The planning process is key
because if you have a budget
00:10:49.28\00:10:52.98
and you
understand what you're doing.
00:10:53.01\00:10:54.35
And yes, a budget applies
to you as a college student,
00:10:54.38\00:10:57.82
it applies to what
you have to accomplish,
00:10:57.85\00:10:59.99
it applies to
you and your success.
00:11:00.02\00:11:02.42
The earlier that you start
with planning and budgeting
00:11:02.46\00:11:07.30
the better off that you will
be in planning for your future.
00:11:07.33\00:11:12.70
So then we went in
further in this conversation
00:11:12.73\00:11:15.34
I had with Josh, and we
talked a little bit more
00:11:15.37\00:11:17.77
about tax deferred
growth and the like.
00:11:17.81\00:11:21.04
And here is what that
conversation had to offer.
00:11:21.08\00:11:23.31
Listen keenly.
00:11:23.35\00:11:24.68
Are there other
things they can look for,
00:11:25.85\00:11:28.65
not just looking
back at paying off debt,
00:11:28.68\00:11:31.05
but future, kind of,
00:11:31.09\00:11:32.42
investments that they can think
of as students that may help
00:11:32.45\00:11:35.99
them as their debt
decreases their net worth
00:11:36.02\00:11:39.23
can also increase
from financial assets
00:11:39.26\00:11:40.66
that they develop?
00:11:40.70\00:11:42.06
Definitely, and you
can definitely start saving
00:11:42.10\00:11:44.33
for your future while
you're going to school.
00:11:44.37\00:11:46.50
You know, while you're investing
00:11:46.53\00:11:47.87
in your own
personal financial...
00:11:47.90\00:11:49.24
Your own personal education,
you can start investing
00:11:49.27\00:11:51.31
in your own
future at the same time.
00:11:51.34\00:11:53.38
And so a lot of students
are working part time jobs,
00:11:53.41\00:11:56.18
a lot of
students may have already
00:11:56.21\00:11:57.55
had some savings available,
00:11:57.58\00:11:59.28
and a small portion
of that can already,
00:11:59.31\00:12:01.25
you know, can be
invested in an investment
00:12:01.28\00:12:03.92
account like an IRA, a Roth IRA.
00:12:03.95\00:12:07.72
What is that?
00:12:07.76\00:12:09.19
Explain IRA, what is that mean?
00:12:09.32\00:12:11.26
It's an individual
retirement account.
00:12:11.29\00:12:12.63
Okay.
00:12:12.66\00:12:14.00
And so anyone, an individual
can have a savings account,
00:12:14.03\00:12:18.23
it's like a savings account,
but the account has options
00:12:18.27\00:12:22.47
like stocks and bonds
and it's tied to investment
00:12:22.50\00:12:24.67
in the stock market.
00:12:24.71\00:12:26.04
So, you know, as the
value of those stocks and bonds,
00:12:26.07\00:12:28.94
you know, fluctuate
and potentially increase,
00:12:28.98\00:12:31.58
the money you're investing
00:12:31.61\00:12:32.95
in that account
can also increase.
00:12:32.98\00:12:35.05
What is the benefit
of saving in an IRA?
00:12:35.08\00:12:37.29
Is that pre-tax
dollars that go in?
00:12:37.32\00:12:39.85
You're not taxed on
those, those funds, correct?
00:12:39.89\00:12:43.02
The benefit in IRA usually,
you use that money it's,
00:12:43.06\00:12:47.40
it's after tax money.
00:12:47.43\00:12:48.76
So you get a paycheck
and you put that into an IRA.
00:12:48.96\00:12:51.20
Now in an IRA,
the amount of money
00:12:51.23\00:12:53.57
you invest in an IRA
can be a tax deduction.
00:12:53.60\00:12:56.81
It can lower your yearly
income at the end of the year.
00:12:56.84\00:12:59.11
One of the benefits of...
00:12:59.14\00:13:01.18
Another benefit of an IRA
is that it grows tax deferred.
00:13:01.21\00:13:04.48
So as the value of
your account increases,
00:13:04.51\00:13:07.82
you're not taxed on
the additional value
00:13:07.85\00:13:09.95
of the increase.
00:13:09.98\00:13:12.19
And so that's
another benefit of an IRA.
00:13:12.22\00:13:16.12
Interesting. You
can get tax deferred.
00:13:16.16\00:13:17.89
So there are a lot
of different venues
00:13:17.93\00:13:19.89
a college
student can use as a plan
00:13:19.93\00:13:22.76
towards finishing school
00:13:22.80\00:13:25.53
and starting
their overall career.
00:13:25.57\00:13:27.64
Yeah, an important piece
00:13:27.67\00:13:29.00
I want to make sure that
we're aware of in an IRA,
00:13:29.04\00:13:30.54
it is a long term investment.
00:13:30.57\00:13:31.91
So depending on
your liquidity needs,
00:13:31.94\00:13:33.31
depending on how much
access you need to that money,
00:13:33.34\00:13:36.48
you know that an IRA
is a long term investment.
00:13:36.51\00:13:38.55
So if you ever
need money from an IRA
00:13:38.58\00:13:40.65
and you pull money out
00:13:40.68\00:13:42.38
of that IRA
before 59 and a half,
00:13:42.42\00:13:44.45
there are taxes and
penalties that can be incurred
00:13:44.49\00:13:46.69
if you pull it out too soon.
00:13:46.72\00:13:49.06
And so you want to
keep an eye on that.
00:13:49.09\00:13:51.19
And if you need
something liquid then,
00:13:51.23\00:13:53.19
you know, a
basic savings account
00:13:53.23\00:13:54.56
where you can have access
to that money a little easier
00:13:54.60\00:13:57.30
that doesn't have
any penalties or taxes
00:13:57.33\00:13:59.03
that pull money out for
more short term or mid term,
00:13:59.07\00:14:02.97
kind of, savings is
important, idea for that idea.
00:14:03.00\00:14:06.37
Wonderful opportunities
out there for savings
00:14:06.41\00:14:08.81
and for developing wealth.
00:14:08.84\00:14:10.45
And not only the career
that you'll have after college
00:14:10.48\00:14:13.72
that will help
you pay off your debt,
00:14:13.75\00:14:15.25
but also the funds that
you'll have saved towards
00:14:15.28\00:14:18.45
that future value
of that investment,
00:14:18.49\00:14:20.56
which is great.
00:14:20.59\00:14:22.52
Now I'm going to take you back
to one other part of the email
00:14:22.56\00:14:25.33
that we haven't yet reviewed
00:14:25.36\00:14:26.70
and I want to ask a
question about that.
00:14:26.73\00:14:28.13
And, she's asking, all right.
00:14:28.16\00:14:30.87
"I have a line of
credit from a bank
00:14:30.90\00:14:32.97
that's close to 2000 dollars.
00:14:33.00\00:14:34.94
Now I want to pay it off."
00:14:34.97\00:14:36.44
So it means that she has,
00:14:36.47\00:14:38.24
she's used up some
of that line of credit.
00:14:38.27\00:14:40.78
"But I don't have the
finances to take care of it.
00:14:40.81\00:14:43.98
Could I add that in
with my student loans,
00:14:44.01\00:14:46.78
which are funded
from the government?"
00:14:46.82\00:14:49.82
Whether it's to subsidize
or on subsidized loans,
00:14:49.85\00:14:53.22
the question is
can you incorporate it
00:14:53.25\00:14:55.66
under a government type loan?
00:14:55.69\00:14:57.33
Yeah, that's a great question.
00:14:57.36\00:14:59.49
So the first thought is,
00:14:59.53\00:15:01.73
I don't think
that a student loan
00:15:01.76\00:15:05.13
can incorporate
any outside debt.
00:15:05.17\00:15:07.74
You know, student
loan is specifically
00:15:07.77\00:15:09.20
for educational purposes.
00:15:09.24\00:15:11.81
So I've not heard of any
programs that can do that.
00:15:11.84\00:15:14.01
So no, I don't
think that's possible.
00:15:14.04\00:15:16.54
You can't
incorporate your line of credit
00:15:16.58\00:15:18.71
and move it into
your student loan.
00:15:18.75\00:15:20.38
Now I'm able to do the opposite.
00:15:20.42\00:15:23.15
If you've got a line of credit,
00:15:23.18\00:15:24.52
which is, kind of,
having a credit card
00:15:24.55\00:15:27.46
and you might be able to
incorporate your student loan
00:15:27.49\00:15:29.26
into your line of credit.
00:15:29.29\00:15:31.16
And one of the
reasons why that would work
00:15:31.19\00:15:32.99
is if your line of credit
offers a lower interest rate
00:15:33.03\00:15:36.26
than your current college debt.
00:15:36.30\00:15:39.67
So if it is lower interest rate,
00:15:39.70\00:15:42.17
then you'll be
paying less long term.
00:15:42.20\00:15:44.41
And you can... It's
like using a credit card
00:15:44.44\00:15:46.27
to pay off your college tuition.
00:15:46.31\00:15:48.98
So again, you have to
look at your interest rate,
00:15:49.01\00:15:51.75
if they're going
to charge you any fees
00:15:51.78\00:15:53.25
in closing it early
and things like that.
00:15:53.28\00:15:55.98
A lot of great ideas in there
00:15:59.82\00:16:01.52
and I hope you've
picked up on a couple of things
00:16:01.56\00:16:03.29
that are there, the Roth IRA,
00:16:03.32\00:16:04.96
the IRA,
Individual Retirement Account.
00:16:04.99\00:16:07.36
All of these things
have a thing to play,
00:16:07.40\00:16:09.23
but I had a question
from one of the viewers
00:16:09.26\00:16:12.73
that was asking
about tuition and school
00:16:12.77\00:16:16.40
and what if I can't
afford to actually go to school
00:16:16.44\00:16:19.24
or pay for school at a
community college level
00:16:19.27\00:16:21.91
or anywhere else?
00:16:21.94\00:16:23.28
What if I can't make
it to that first level
00:16:23.31\00:16:26.82
and getting into
any type of school?
00:16:26.85\00:16:28.92
But, of course, you know,
there's a performance measure
00:16:28.95\00:16:30.65
that you should
have in high school
00:16:30.69\00:16:32.02
and many of us as inner city
00:16:32.05\00:16:33.46
and urban urbanites, do
with very well in school,
00:16:33.49\00:16:36.76
you perform well.
00:16:36.79\00:16:38.26
Concentrate on your school work,
00:16:38.29\00:16:39.66
concentrate on
what you are given to do
00:16:39.69\00:16:42.06
and do your best at
it and remember this
00:16:42.10\00:16:45.00
that if you've
fit specific criteria,
00:16:45.03\00:16:46.74
there are programs that are out
there based on your geography,
00:16:46.77\00:16:50.21
and I can check on
that on your behalf,
00:16:50.24\00:16:52.04
but there are some independent
development accounts programs
00:16:52.07\00:16:55.91
that if you reach a
specific savings goal,
00:16:55.94\00:16:59.55
the money is put aside
00:16:59.58\00:17:00.92
into a tertiary bank
accounts, it's managed,
00:17:00.95\00:17:04.22
they will match your
funds dependent on the program
00:17:04.25\00:17:07.22
two to one, three to
one, and even four to one.
00:17:07.26\00:17:09.29
So if you want to save
money, those specific accounts
00:17:09.32\00:17:12.86
can actually go
towards buying a new car,
00:17:12.89\00:17:15.80
putting down payment on a
house, college tuition fees,
00:17:15.83\00:17:18.73
and as well as
starting a new business.
00:17:18.77\00:17:20.24
So there are
options that are available
00:17:20.27\00:17:22.40
to you as a young person
00:17:22.44\00:17:24.24
in whatever geography or
urban community that you live.
00:17:24.27\00:17:27.38
And it's not something that you
should give up too easily on.
00:17:27.41\00:17:30.78
Because we have resources,
00:17:30.81\00:17:32.31
there are things
that are available
00:17:32.35\00:17:34.02
and I would love
to have an opportunity
00:17:34.05\00:17:35.82
to get an email
from you and or call
00:17:35.85\00:17:38.42
asking that same
question so we can check
00:17:38.45\00:17:40.82
on those
specifics on your behalf.
00:17:40.86\00:17:43.12
But a lot of things
came out of the conversation
00:17:43.16\00:17:44.93
with Josh where I think
that we all should be aware of.
00:17:44.96\00:17:47.03
One of the things has to do
00:17:47.06\00:17:48.70
with the simplicity of a budget,
00:17:48.73\00:17:50.87
understanding
that investment account
00:17:50.90\00:17:54.10
should not be touched,
00:17:54.14\00:17:55.47
because it's a
long term investment,
00:17:55.50\00:17:57.94
that's what an IRA is all about.
00:17:57.97\00:17:59.74
And when I tell you
about it, put the money aside
00:17:59.77\00:18:02.71
and don't ever intend
on trying to get that back
00:18:02.74\00:18:05.91
until you need
it at 59 and a half.
00:18:05.95\00:18:08.38
Because you will incur fees,
00:18:08.42\00:18:11.32
the overall objective
for that type of account
00:18:11.35\00:18:14.26
is to save for your retirement.
00:18:14.29\00:18:15.89
So know that the
long term investment.
00:18:15.92\00:18:18.16
But what is a simple part of?
00:18:18.19\00:18:20.30
Is a fact that if
you, as a young person,
00:18:20.33\00:18:23.33
begin with a
budget and a system,
00:18:23.37\00:18:25.97
no matter if you
make 1000 dollars a month,
00:18:26.00\00:18:28.20
1,500 dollars a
month, 6000 dollars a month,
00:18:28.24\00:18:31.27
all that matters
is, you have now begun
00:18:31.31\00:18:32.97
the process of engaging
in this process that says,
00:18:33.01\00:18:36.58
"I'm going to allocate time
to figuring out my expenses,
00:18:36.61\00:18:40.35
figuring out what I spend,
00:18:40.38\00:18:41.95
and figuring out
where I can save,
00:18:41.98\00:18:44.09
cutback, substitute,
00:18:44.12\00:18:45.65
and make sure I have
emergency savings in place,
00:18:45.69\00:18:48.62
so I can take some care
of some of those other things
00:18:48.66\00:18:51.99
that I can take care of."
00:18:52.03\00:18:53.36
Remember, a retirement
account, a long term investment
00:18:53.40\00:18:55.73
should only come about when
you've got your house in order.
00:18:55.76\00:18:58.77
There is no way
that you can maintain
00:18:58.80\00:19:01.10
a long term
savings investment account
00:19:01.14\00:19:05.24
when you can't even,
00:19:05.27\00:19:06.88
when you're spending
00:19:06.91\00:19:08.24
what you make
on a monthly basis.
00:19:08.28\00:19:09.68
It can't happen.
00:19:09.71\00:19:11.05
Something has to give.
00:19:11.08\00:19:12.55
So make sure
you've already studied,
00:19:12.58\00:19:14.68
put something away in savings,
00:19:14.72\00:19:16.28
you have that additional funding
00:19:16.32\00:19:17.85
and additional ability
to take some other funds
00:19:17.89\00:19:21.36
and put into
account that you'll probably
00:19:21.39\00:19:23.36
never touch for a long time.
00:19:23.39\00:19:25.09
And that the
wisdom of budgeting,
00:19:25.13\00:19:26.63
the simplicity of understanding
that if I know where I'm at,
00:19:26.66\00:19:30.17
I know where I want to go.
00:19:30.20\00:19:31.73
And know this that if
you plan and you understand
00:19:31.77\00:19:35.90
and you get in touch
with the right resources,
00:19:35.94\00:19:38.47
they might find out there
are programs available for you,
00:19:38.51\00:19:41.18
yes, you, to be
able to get access
00:19:41.21\00:19:43.28
to that type of
college experience.
00:19:43.31\00:19:46.35
The other thing
that's was relevant
00:19:46.38\00:19:48.32
to our
conversations with Joshua,
00:19:48.35\00:19:50.92
I had to do with the issue
00:19:50.95\00:19:52.99
that we all spend what we make.
00:19:53.02\00:19:55.12
We talk about that issue
00:19:55.16\00:19:56.83
and the importance
of how we should address
00:19:56.86\00:20:00.70
how we are how we
utilize our budget?
00:20:00.73\00:20:03.47
The budget in and of
itself is in agreement
00:20:03.97\00:20:06.07
with yourself,
your family, your spouse
00:20:06.13\00:20:08.07
that I am going to
spend in this manner
00:20:08.10\00:20:11.07
and I am going to
ensure that I put funds away
00:20:11.11\00:20:14.31
in this manner on a monthly,
00:20:14.34\00:20:15.71
on a quarterly
basis and I will ensure
00:20:15.74\00:20:17.78
that I have the funds necessary
00:20:17.81\00:20:19.28
to maintain this
individual retirement account
00:20:19.31\00:20:22.18
and I will know that if
I fit the right criteria,
00:20:22.22\00:20:24.95
I can ask the right questions,
00:20:24.99\00:20:26.62
and I can get
access to some funds
00:20:26.65\00:20:28.42
that can match my savings
00:20:28.46\00:20:30.73
and can go towards
getting me into that venue
00:20:30.76\00:20:33.66
that I would like to get into.
00:20:33.70\00:20:35.46
But let's go back to the
conversation with Joshua.
00:20:35.50\00:20:37.93
Here we talked
about the spending issue,
00:20:37.97\00:20:40.40
spending what you make.
00:20:40.44\00:20:41.84
This was very interesting.
00:20:41.87\00:20:43.30
Let's take a look.
00:20:43.34\00:20:46.71
This is just another scenario
that just always comes up
00:20:46.74\00:20:50.65
and it's a question
that always comes up.
00:20:50.68\00:20:52.28
It's quite interesting
because a lot of students are,
00:20:52.31\00:20:53.82
okay, they're gonna come out
00:20:53.85\00:20:55.18
with a job paying them
about 50, 60,000 dollars a year
00:20:55.22\00:20:58.29
and you want to buy a home,
00:20:58.32\00:20:59.72
you want to buy
these type of elements.
00:20:59.75\00:21:01.22
Long term, we're
always talking long term now,
00:21:01.26\00:21:03.39
is from an
investment standpoint,
00:21:03.43\00:21:05.43
how do I, as an individual,
prepare for those long term,
00:21:05.46\00:21:09.73
my promotions at work
and the different scenarios
00:21:09.76\00:21:14.10
that happen in
my life as I evolve,
00:21:14.14\00:21:17.17
does my home evolve?
00:21:17.21\00:21:18.64
Does my growth, the
types of car I drive evolve?
00:21:18.67\00:21:20.81
Do I always have to
keep up with the Joneses,
00:21:20.84\00:21:22.51
that kind of a thing?
00:21:22.54\00:21:24.71
If I go from
60,000 dollars a year
00:21:24.75\00:21:27.12
and I have a nice house
00:21:27.15\00:21:28.75
and I go to
75,000 dollars a year,
00:21:28.78\00:21:31.55
does that necessarily
mean I need to move up
00:21:31.59\00:21:33.89
in the house size?
00:21:33.92\00:21:35.26
Does it necessarily mean
I need to change the car?
00:21:35.29\00:21:37.39
Do you need to
spend what you earn?
00:21:37.43\00:21:40.60
Right, that's a great question.
00:21:40.63\00:21:42.66
One of the biggest
mistakes I see people make
00:21:42.70\00:21:45.50
is that they feel obligated
to spend what they make.
00:21:45.53\00:21:49.24
You know, as soon as a
promotion happens at work,
00:21:49.27\00:21:51.97
they're in their current car,
before they get to their house,
00:21:52.01\00:21:56.61
they're already
driving a new car.
00:21:56.64\00:21:58.58
Mentally, they've already bought
00:21:58.61\00:22:00.52
the car that they want to buy.
00:22:00.55\00:22:02.15
And that car they
want to buy maybe just eat
00:22:02.18\00:22:06.52
more on a monthly payment
00:22:06.55\00:22:07.96
than what they just
got in the promotion.
00:22:07.99\00:22:09.69
But it's just enough for them
to say and justify buying it.
00:22:09.72\00:22:12.86
So one of the biggest success...
00:22:12.89\00:22:14.73
Several of the
biggest success stories
00:22:14.76\00:22:16.30
I've seen in savings
accounts with my clients
00:22:16.33\00:22:19.23
are clients that
have been in their career
00:22:19.27\00:22:21.04
for 10-15 years and they never
used their promotion money,
00:22:21.07\00:22:27.58
they stayed-- You know,
they got a decent income,
00:22:27.61\00:22:30.15
they bought a home, they
bought a car they were happy
00:22:30.18\00:22:32.98
with that did the job,
00:22:33.01\00:22:35.75
and every time
they got a promotion,
00:22:35.78\00:22:38.35
they would just
stock that extra money
00:22:38.39\00:22:39.72
away into savings account.
00:22:39.75\00:22:41.16
And they lived, just
as they were five, eight,
00:22:41.19\00:22:44.19
ten years ago, when
they had first got their job.
00:22:44.23\00:22:47.10
And it's just amazing how
significant of an increase
00:22:47.13\00:22:50.93
their savings begins to grow.
00:22:50.97\00:22:53.70
So not only did they
stock that extra money away,
00:22:53.74\00:22:56.10
but they still kept
their savings plan as it was.
00:22:56.14\00:22:58.97
If they were starting to
save 100 dollars a month,
00:22:59.17\00:23:02.01
they still save
100 dollars a month,
00:23:02.04\00:23:03.61
but they also
moved in that extra money
00:23:03.65\00:23:05.88
into their savings account.
00:23:05.91\00:23:07.25
So having that mentality,
00:23:07.28\00:23:09.48
you know, definitely want
to live, you don't want to,
00:23:09.52\00:23:11.32
you know, stay in a cabin,
00:23:11.35\00:23:12.85
if that's where
you started, and,
00:23:12.89\00:23:14.22
you know, if you're
looking to move into a place
00:23:14.26\00:23:16.42
with some nice
utilities and thing like that,
00:23:16.46\00:23:18.86
you know, you
deserve those things.
00:23:18.89\00:23:20.66
We talked about
earlier, live life,
00:23:20.70\00:23:22.03
enjoy the money you make.
00:23:22.06\00:23:23.47
But you don't
have to spend it all.
00:23:23.50\00:23:28.07
Live life, enjoy the
money, but remember this,
00:23:28.10\00:23:32.47
happiness doesn't come
from spending on yourself.
00:23:32.51\00:23:36.04
Enjoy by spending on
others, by supporting others,
00:23:36.08\00:23:39.41
by using you're ability to gain
00:23:39.45\00:23:43.25
through the
experience of budgeting,
00:23:43.28\00:23:45.29
so you can support
these agencies that are giving
00:23:45.32\00:23:48.32
the Gospel to the world.
00:23:48.36\00:23:49.69
Now in reference to some
of the things that were said,
00:23:49.72\00:23:52.03
I heard the story of, you know,
a professional athlete that,
00:23:52.06\00:23:56.26
you know, when
we think about it,
00:23:56.30\00:23:57.77
they're not really in
their profession that long.
00:23:57.80\00:24:00.44
And typically, from
the status of football,
00:24:00.47\00:24:03.44
many of them last in the
league for about three years,
00:24:03.47\00:24:06.64
an average of three years.
00:24:06.68\00:24:08.01
And within five years
after they're retired,
00:24:08.04\00:24:10.45
they're out of cash.
00:24:10.48\00:24:11.81
It's a big issue and one
story is told of one gentleman
00:24:11.85\00:24:14.05
that had to retire from the game
00:24:14.08\00:24:16.65
and he just gotten his,
00:24:16.69\00:24:19.32
I believe some type
of monies from an injury
00:24:19.35\00:24:23.12
that he had incurred
on the football field
00:24:23.16\00:24:25.59
and it was a lump sum.
00:24:25.63\00:24:27.10
Part of it was already taken out
00:24:27.13\00:24:28.46
for some type of
child support payment.
00:24:28.50\00:24:31.23
But he said as
he was driving home,
00:24:31.27\00:24:33.40
he had that 54,000 dollars,
00:24:33.44\00:24:36.50
I believe it is, on
him as he was driving home.
00:24:36.54\00:24:39.37
And guess what?
00:24:39.41\00:24:40.74
As he was driving home he
saw that new vehicle that,
00:24:40.78\00:24:43.98
it was a new vehicle at
the time that was available
00:24:44.01\00:24:46.92
and it cost
almost 40,000 dollars
00:24:46.95\00:24:50.15
with all the bells and whistles.
00:24:50.19\00:24:51.52
And guess what he did?
00:24:51.55\00:24:52.89
With his last 54,000
dollars, that gentleman went
00:24:52.92\00:24:55.99
and bought the next best thing.
00:24:56.02\00:24:58.46
He didn't think
about the future.
00:24:58.49\00:25:01.56
He thought about now,
00:25:01.60\00:25:03.13
about greed, about
getting what he wanted now.
00:25:03.16\00:25:05.93
And I think
that's one of the things
00:25:05.97\00:25:07.67
we need to take in from
the standpoint of understanding
00:25:07.70\00:25:11.71
why God is saying
00:25:11.74\00:25:13.07
that if we have
godliness with contentment
00:25:13.11\00:25:16.75
that is a great game.
00:25:16.78\00:25:18.41
Being at peace
with where you're at,
00:25:18.45\00:25:20.62
studying the venues,
studying the horizon,
00:25:20.65\00:25:23.55
seeing what works for you,
00:25:23.59\00:25:25.09
figuring out the
programs that are available,
00:25:25.12\00:25:27.12
thinking for the future,
00:25:27.16\00:25:28.66
because when
most people buy cars,
00:25:28.69\00:25:30.43
they don't realize that there
are costs associated with it
00:25:30.46\00:25:33.86
as would be
insurance payments, and gas,
00:25:33.90\00:25:37.57
and maintenance and
all of these other elements
00:25:37.60\00:25:40.44
from that standpoint.
00:25:40.47\00:25:42.70
Thinking of the future talks
about this issue called college
00:25:42.74\00:25:45.77
and I'm talking to that market
00:25:45.81\00:25:47.18
that's looking
at going to school
00:25:47.21\00:25:48.78
or may have
recently finished school
00:25:48.81\00:25:50.68
or may have finished
school a few years back,
00:25:50.71\00:25:52.45
but still has the college debt.
00:25:52.48\00:25:54.05
There are different resources
00:25:54.08\00:25:55.48
that you can use to
help pay off the debt quicker
00:25:55.52\00:25:57.85
or pay it off
through public service.
00:25:57.89\00:25:59.75
There are a lot of things
that you can do to support
00:25:59.79\00:26:03.06
what you're doing and support
the ability to get into school,
00:26:03.09\00:26:07.50
whether you
don't have the funds,
00:26:07.53\00:26:09.70
there are ways
to find the funds.
00:26:09.73\00:26:11.77
If you do well in school,
00:26:11.80\00:26:13.44
there are opportunities
through scholarships.
00:26:13.47\00:26:15.57
And when you look at school,
00:26:15.60\00:26:17.47
understand that that debt
that you have can be minimized,
00:26:17.51\00:26:21.41
and if you think future...
00:26:21.44\00:26:24.08
For a future tense,
00:26:24.11\00:26:25.45
you can begin
planning your future
00:26:25.48\00:26:27.42
by putting money aside
00:26:27.45\00:26:29.42
right now to pay
for those other expenses
00:26:29.45\00:26:32.39
that will come your way.
00:26:32.42\00:26:34.22
So we take a look at that.
00:26:34.26\00:26:36.09
We thank Mr. Joshua Hernandez
00:26:36.12\00:26:38.19
for his for his
time and for his insight
00:26:38.23\00:26:39.76
because it provides you
an opportunity to look more
00:26:39.79\00:26:43.57
so at your finances
00:26:43.60\00:26:45.10
and look at one
of the big things
00:26:45.13\00:26:47.40
that cause a lot of
stress in people's life.
00:26:47.44\00:26:49.97
College student loan
debt is one of the top three
00:26:50.01\00:26:52.67
along with bank loans
00:26:52.71\00:26:54.81
and along with credit card debt.
00:26:54.84\00:26:56.85
Those top three are things
that you should be aware of.
00:26:56.88\00:26:59.48
Start thinking about it now,
00:26:59.51\00:27:01.22
and begin the
process of understanding
00:27:01.25\00:27:03.99
the value in your
life when you can live it,
00:27:04.02\00:27:08.32
without the debt
00:27:08.36\00:27:09.76
and live it with
the peace of mind
00:27:09.79\00:27:11.73
knowing that you can support
00:27:11.76\00:27:13.80
and do and be for others.
00:27:13.83\00:27:16.16
So we talk about
student loan debt,
00:27:16.20\00:27:18.50
we talk about college debt,
00:27:18.53\00:27:20.47
we talk about
you as an individual.
00:27:20.50\00:27:22.67
Wherever you live,
there are opportunities,
00:27:22.70\00:27:26.47
there are chances for you
00:27:26.51\00:27:28.68
to become something
far greater than yourself.
00:27:28.71\00:27:31.65
And when you
plan for your future,
00:27:31.68\00:27:33.82
you're planning
to become wealthy,
00:27:33.85\00:27:35.62
not because of how
much money you will make,
00:27:35.65\00:27:37.99
but because how you
will manage your money,
00:27:38.02\00:27:42.12
how you will spend your money,
how you will save your money,
00:27:42.16\00:27:45.96
how you will buy
assets with your funds,
00:27:45.99\00:27:48.36
and how you will
invest your funds.
00:27:48.40\00:27:50.73
I am thrilled to
have this opportunity
00:27:50.77\00:27:52.53
to talk to you about
this issue called debt
00:27:52.57\00:27:55.14
because I've seen it in my life
00:27:55.17\00:27:56.71
and in other lives.
00:27:56.74\00:27:58.41
If you think,
00:27:58.44\00:27:59.77
then you can take that
extra to the bank and save.
00:27:59.81\00:28:03.31
God bless.
00:28:03.35\00:28:04.68