Things I DIDN’T Learn in College: Part 9 – Personal Finance

by Ron Haynes

College is long on theory but short on application, long on ideas but short on reality, long on book learning but short on real world experience. I think people without college degrees sell themselves short by thinking that they’ve missed the boat, but my experience says that, while a degree is worthwhile, it isn’t a requirement for success in life.

Some of the most successful people in the world have learned how to be successful in their personal finances by incorporating three simple ideas:

1. Spend less than you earn. Whoa! Stop the presses. Here’s a revelation for the ages.

There is a stack of money that you bring home each pay period. Your goal is to NOT use it up. By creating a gap between what you earned and what you spend, you set yourself up to have “disposable income.” Your goal is to increase that disposable income as much as possible by either spending less or by earning more.

Spending less means maximizing every dollar that comes into your home. It means searching, diligently searching for way to reduce the amount you have to spend on needs and coming to terms with the amount you spend on wants. Not every want is a need and you’ll have to sort that out within yourself.

What freebies could you get? What opportunities do you have for clipping coupons, carpooling, cooking at home, or cleaning your own clothes? What expensive (cough, cough Starbucks) habits do you indulge in? Some people I know spend mountains of dollars on sodas, snacks, and vending machines. Could you give up smoking? How about season passes to NASCAR? Oops, stepping on some toes here.

Don’t be cheap, be frugal. Cheap is inviting people over and serving them sodas in small glasses overloaded with ice. Frugal is inviting people over and serving them a delicious home-made mint tea that only cost 5 cents per serving. Don’t make yourself miserable and don’t get a reputation for being a cheapskate, but also don’t forget the big picture.

Earn more by furthering your education or by setting up a side business. Could you start a blog or build decks or sell homemade candles online? It doesn’t really matter what you do to earn more, what matters is your attitude. You must constantly be seeking, actively seeking opportunities to increase your income. Could you tutor someone, or babysit for four moms that work 3rd shift, or set up your own house cleaning crew? The possibilities are literally endless if you take the attitude that you will succeed.

2. Manage your money properly.
Begin by getting current with all debt and possibly negotiating with your creditors to lower your rates (they will usually do this if you only ask). Next create an emergency fund so that when the car needs a new battery, or new tires, or you have to pay a deductible on your son’s broken arm, you don’t immediately reach for the credit card. Next move to pay off all your debt by the debt snowball or by debt snowflaking. Pay everything you can towards one debt and the minimums on all others, then when that one is paid, take everything you were paying on it and put it towards your next debt. Continue on until there’s no more debt left!

Once you’re out of debt, you can begin to consider investments of different types. Be sure you take advantage of your employers You should also consider your personal commitment to your children’s college education and make arrangements for that if you’re so inclined.

Most financial advisers recommend that you begin your investing journey by using broad based, low fee, index funds. I would concur until you feel you have the time and the wherewithal to investigate investing in individual stocks. Stock investing involves a ton of research and should only be undertaken with money you can afford to lose.

3. Remember why you’re doing all this. It’s about you controlling your life rather than being controlled by money. It’s about you being able to decide to play a round of golf on a Tuesday because the weather is nice and NOT having to play hooky from work. It’s about being able to go to the school plays, the ballet recitals, the baseball tournaments, the middle of the day parent teacher conferences. Money, in and of itself, is useless. It’s just a piece of paper with some printing on it. But what it does, in sufficient quantity, is allow you to experience something that few people get to experience: freedom. The freedom from worry, the freedom from debt, the freedom from a boss breathing down your neck, the freedom to go fishing with your 4 year old grandson in the middle of the day.

Once you have time freedom, you’re able to alter your life, and time freedom is purchased with money. People don’t love money, they love what it represents. For some it’s power and prestige, for others it’s the accumulation of “things,” for others, money represents the ability to live life on their own terms, without being shackled by worries and concerns that the money will run out.

College doesn’t teach this stuff. Virtually no one teaches this information to our children and college age adults. Most businesses are in the business of getting them ensnared in high interest rate debt as soon as their feet hit the college campus.

It’s a shame, too, because students are usually going into student loan debt just to pay for college, then incurring additional high interest rate debt in the form of credit cards. The irony is that most issuers wouldn’t give a card to someone making minimum wage and living in a shared apartment, but if that person is a college student, then the rules are thrown out the window.

[tags]personal finance, debt, income, spend, save, freedom[/tags]

About the author

Ron Haynes has written 1000 articles on The Wisdom Journal.

The founder and editor of The Wisdom Journal in 2007, Ron has worked in banking, distribution, retail, and upper management for companies ranging in size from small startups to multi-billion dollar corporations. He graduated Suma Cum Laude from a top MBA program and currently is a Human Resources and Management consultant, helping companies know how employees will behave in varying situations and what motivates them to action, assisting firms in identifying top talent, and coaching managers and employees on how to better communicate and make the workplace MUCH more enjoyable. If you'd like help in these areas, contact Ron using the contact form at the top of this page or at 870-761-7881.

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Bravo, Ron! The sad thing is that personal finance ends up being simpler and easier than almost any college course, yet so many don’t figure it out.

Jeff@My Super-Charged Life

Ron – I wished someone would have taught me more about personal finances when I was in college. If I had made some smarter choices along the way then, I would be so much further ahead today. The two things that I wished I would have done is avoided debt and started investing in good mutual funds as soon as I left school. I believe these two lessons alone could make a college student wealthy by the time they are in their 40s.


Great article Patrick. Your points are spot on in this post.

If you want to exchange links, drop in a comment on my blog and I’ll add you to my blogroll.



Great points and spot on. They should personal finance 101 a mandatory course in school and college!


That would be a great idea. The problem is that there isn’t someone, other than the student, who benefits. The colleges all get paid by the credit card issuers and they receive monies from the proceeds of the student loans. They have no incentive to teach personal finance.

It’s a shame really. A shame that we send people off to start their life shackled to a rock they will drag around with them for decades.

one way link building

This is Martin. I find I pay for most things on credit card. With that said, I pay off my credit card every month. Most people I know don’t do that. Debt is slavery. No doubt about that. I’m self employed. The worst thing I hate is that on average I try to save half of my gross income for taxes. A lot of times I don’t owe that much but the fear of the alphabet boys (IRS,FBI) coming to me three years from now saying I owe 40K and God forbid I don’t have it, keeps me from doing other things like live within my earned means. I’m not even talking blowing money in Vegas on private parties, I’m talking extra school. Business investments. Home Improvement. That costs a lot. And in a lot of cases isn’t immediately re coupable.

School is funny thing. I never graduated college (like you couldn’t tell from my spelling), but I find I just have natural hunger to grow and learn. I have friends with degrees who cant’ find descent jobs, the fields they studied for aren’t “hiring”. Now they have student loans and an education that pigeon holds them. What’s worst is no financial discipline.

Not knowing when my next check is coming has given me pretty good financial habits (except for after my fourth shot of scotch). I have a descent emergency fund that I keep in a 5.05% bearing savings account.

A lot of people essentially spend money to become happy. They’ll never admit it but that’s what they do. Happiness is an internal thing. Chasing happiness with money is like the horse chasing the carrot. You’re never gonna catch it. Find reasons to smile when you are broke. When the sum of your life is accounted for you’ll find this a lot easier to rest in peace with than allowing money to control your whole existence. Rather than loving you were miserable. Rather than joyful you were depressed. Realize hell or heaven on earth is all in your mind and you’ll be fine.


@ Martin
The alphabet boys? That’s too funny, I’ll have to remember that one!
Once again, you’ve written a very well thought out and intelligent comment that I agree with. Personally, you sound like someone who should be teaching in college! You’ve always got great insight. I’m thankful to have great readers like you who always know what to say.

Shama Hyder

Hi Ron,

Further education and investing in your business are definitely two big areas which you should never shy away from.

Great lessons!


@Shama Hyder
Thanks Shama, you’re exactly right. Those are two of the few areas that almost ALWAYS warrant special attention.

Thank you for commenting!


thanks for the post. i hope to listen some more.
Best regards from Sebbi


Thank you Sebbi. I hope you enjoy my blog posts. :D


I hear you. I didn’t learn ANYTHING financial in school. I spent a lot of time taking classes that interested me, but didn’t really teach me so much… Sometimes it is better to learn things the by example though, eh? ;)

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