Meet our Achiever: Colleen McMahon!

By Janie O'Brien / Posted: Jan 23, 2018 / 0 Comments / Posted in Student's Corner

Colleen McMahon

Name: Colleen McMahon

School: Washington State University, Pullman

Major: Accounting

Concentration: Taxation

Degree: Master of Science

Congratulations to Colleen McMahon, one of our winners at SDL365 Achievers Scholarship 2017! We were impressed by her essay about the reasons of poor financial decisions and are thrilled to offer her $500 to help pay for university tuition. Congrats, Colleen! Explore! Discover! Dream!

Why Do You Feel That People Make Poor Financial Decisions?

America is a country that is oozing fiscal irresponsibility. Our country has normalized debt with an outstanding $20 trillion in national debt and almost $70 million in combined US debt, we even have a website that is tracking the debt second by second.1 About a decade ago the Great Recession happened and affected most families here in the country for years, and some sources say it is still impacting families and businesses today.2 If all Americans were presented with a random $500 expense, almost 60% of them would not be able to come up with the money to pay for it.3 That is the world that we are living in and continue to live in.

Being a college student currently, I grew up with people drastically affected by financial irresponsibility as they were growing up, yet I still see these same young adults making the same bad decisions that their parents or guardians made years prior and are continuing to make. I used to fall in the same category, I was raised by my biological parents until I was 7 years old. I grew up in a bad area of California and I experienced the more difficult parts of coming from a family with no money: homelessness, living in shelters, having to get our food from school or food banks, etc. My aunt and uncle raised me once both my parents passed away. While my aunt and uncle are not nearly as bad as my parents, I have seen them make poor decisions when it comes to their finances: refinancing their home, having no money saved up in case of an emergency, using quick loans to pay for vacations, and other questionable decisions. When I got a job at 16 I started making the same decisions, obviously not to the same extent, I blew my whole first paycheck on clothes since I could finally shop online and I continued to blow through my entire paycheck. It wasn’t till I was 18 years old and I had $10,000 worth of room and board that wasn’t covered in order to attend WSU and I realized how important it was to save my money and become fiscally responsible. I started saving a large percentage of my paychecks, I think about things and how useful they are before I buy them, and I don’t buy things frivolously just because they are available.

It ultimately all leads to the question that experts wonder day in and day out, why do people make poor money decisions? This is obviously a multi-faceted question since there isn’t a singular reason that people make poor financial decisions.

One part of the problem is that we live in a materialistic world. People are categorized by how much money they make in a year, how nice their house is, what kind of car they drive, what brands of clothes they wear, and various out tangible material things. Children go to school and are made fun of if they aren’t wearing the nicest clothes or shoes and that leaves an impact on their adult life as well. When people grow up and are able to make their own decisions, a lot of people live outside their means in order to impress people and give off the image that they can afford these nice things. The American dream is something that everyone is aware of and most people think that they need materials things to be able to show they are doing well, even if it is hurting them financially.

Another huge factor that plays into people’s financial decisions is actually their parents and how they raised them. In the 6thAnnual Parents, Kids and Money Survey, it was concluded 97% of kids will go to their parents if they have questions about money and 2% will go to someone in the family.4 Parents don’t realize the effect they have on their children and how much they can help them grow, but also how much they can hinder them. If parents are making poor financial decisions, their children see their actions and assume those are the decisions they should be making. If parents prioritize material things and not financial security, children see that and that is the only behavior they know. Even if their parents make good financial decisions, but don’t teach their children good spending habits, the same thing can happen. While the parents may be in a good financial spot and can spend money comfortably, but don’t teach their children that they can’t sustain the same habits the children will become financially inept.

Overall, there are many reasons that people make bad financial decisions and we can point fingers to everyone; however, there are many solutions to educate people to financially responsible. If people are educated and realize they are in charge of their finances, we will see a huge change in financial decisions by Americans. In the end, people are just uneducated and to empower them with their money we need to teach them how to best spend their money.

Works Cited

1 “U.S. National Debt Clock : Real Time.” U.S. National Debt Clock : Real Time,

2 Grovum, Jake. “2008 financial crisis impact still hurting states.” USA Today, Gannett Satellite Information Network, 15 Sept. 2013,

3 Picchi, Aimee. “A $500 surprise expense would put most Americans into debt.” CBS News, CBS Interactive, 12 Jan. 2017,

4 Folger, Jean. “Your Bad Financial Habits Can Hurt Your Kids.” Investopedia, 2 Sept. 2014,

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