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Financial Character  & Common Sense

2/13/2017

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What does your character say about you? What does it say about your finances? So often what we spend, what we save, and what we owe are reflections of who we are personally. When students receive financial aid refunds, how they proceed with large amounts of funds can lead to either long-term financial advantage or disadvantage.

Often, the refund includes grant, scholarship, and loan amounts after tuition and fees have been paid. While grant and scholarship funds do not require repayment, loans do. Subsidized loans withhold interest until after graduation, while unsubsidized loans begin compounding interest upon receiving funds. So what should students do with all of that refund money?

Students who think in short-term sense will feel like they have plenty of time to repay back loans, so spending a little (or a lot) on oneself now cannot be so bad. Students who think in the long-term sense will feel like they should prioritize spending habits. Maybe they should save some for potential hard times, or pay rent through the semester, or save for the next semester's expenses.

The latter option can lead to another choice that some students may not know. Just because a student is eligible for aid doesn't mean they have to accept it. Students get award letters or statements revealing the grants, scholarships, or loans they have applied for, or qualified for, and received. There is the option to accept portions as well as reject portions. So by saving some money, students may not need the money they are awarded, which means that if student loans are rejected in following semesters, students will have less to repay.

When it comes to money, moderation must be exercised. Students may need new clothes or professional attire for events, but that doesn't mean "overspend." Students may need a new computer, but maybe not the most expensive one. Some students may need a car, but necessity should say one needs a "work-school-home" car, not the absolute latest car with every amenity and bonus feature. Instead of pursuing lavishness, build emergency savings in the event that eligibility changes for one's scholarship or grant, grades slip below requirements, that student falls ill, etc. That's showing financial common sense, and great financial character.

I hope this post helps you in your academic pursuits. Be blessed!

-T. A.

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    T. A. Acker

    Just sharing what I know to help students become great.

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