Meet our Spring 2018 SDL365 Achiever : Jason Montanez!


By Janie O'Brien / Posted: Apr 25, 2018 / 0 Comments / Posted in Student's Corner

Jason_Montanez

Name: Jason Montañez

School: University of Arizona

Subdivision: College of Science

Major: Computer Science

Graduation Year: 2022


Congratulations to Jason Montañez, one of our winners at SDL365 Achievers Scholarship 2018! We loved his essay about how he fights lack of financial discipline, and are happy to offer him $500 to help pay for college tuition. Congrats, Jason! We wish you to stay wealthy!


How I Fight Lack of Financial Discipline

“Go ahead and try to swipe your card again sir.” That sentence can give anybody a mini heart attack. After all, How hard can it be to save money and stop frivolously spending, right?

According to recent statistics, “The average American spends $1.33 out of every dollar earned.” In the hopes of teaching you how to discipline yourself to spend less, I’ll go over some tips and advantages for building credit, acquiring assets versus liabilities, and how to budget.

Credit, also referred to by my grandmother as “el dinero del diablo”, is in fact god’s gift. I think granny might’ve forgotten to take her meds. Credit is the single most important thing to help your financial standing. Debt is good but not too much debt.

“Americans’ total credit card debt continues to climb in 2017, reaching an estimated $905 billion — a nearly 8% increase from the previous year,” — according to a NerdWallet analysis. From my experience having used only 30% of my available credit has helped me build my credit score by 20 points.

Big brother aka financial institutions, love to know that you aren’t going to go “cash crazy” on them by overspending and showing some semblance of sanity while using their money. Building a good credit report allows you to take out low-interest rate loans for a car, house, or that super duper expensive vacation, which by the way I don’t recommend because unlike interest on homes, they are not tax deductible.

My second piece of advice will be a tale of assets vs. liabilities. My friend’s dad and mine will be the main characters. To start, both our dads made the same income and had the same amount of debt. My dad purchased a new Mercedes with $50,000 while my friend’s dad bought a used vehicle and saved $20,000. My friends dad took the $20,000 he saved and placed it as a down payment for a second house. He rented the 2nd house out which paid for itself via rental income, and he made a few hundred extra dollars a month from the rent. The Mercedes meanwhile depreciated over 5 years and could not be sold with a profit in mind. Meanwhile, the house appreciated in those 5 years and sold making a colossal profit while paying for itself via rental income.

After selling the house, my friend’s dad reinvested his profits by purchasing 2 more rental properties while my dad is stuck with a 5-year-old Mercedes. Who won in this situation? Lesson learned about liabilities vs. assets? Acquiring assets is much more valuable than liabilities. My friend is going to college with his tuition fully paid by his dad while I’m writing this essay and taking public transportation to school.

Awesome. Budgeting. It means no more spending, right? Well, not quite exactly. Budgeting is the hardest to get down, because it’s so fun to shop till you drop, but it’s rewarding once you do. First off, put down on paper how much you make per month. It doesn’t matter if you work a job or you’re living with your parents and earning a basic allowance. Budgeting will maximize your earning and savings potential. Next, spend however much money you usually do on bills, food, entertainment, and clothing. Mark down all your expenses and how much money you have left over. This is where you’ll see how much money you waste on useless items, such as fidget spinners and the newest season of Yeezy shoes. Then, separate necessities and wants; rank each want and see which ones are smart and which are plain useless. You can sacrifice out a few late nights McDonald’s trips or coffee runs before work. It won’t hurt.

If you set aside a set limit for each section, food, bills, entertainment, and clothing, you will see where most of your money is spent. Lastly, the most important budgeting tip is to save at least 10% of your earning. If you save, you will always be flat broke after each payday. Also, set aside a few bucks aside for emergency situations. A random flat tire or dead car battery will break your bank, but not if you’re prepared. Budgeting is the most important piece of advice and I can’t preach it enough. If you don’t have a set limit for each month, you’ll never know how to spend your money. If you educate yourself on how to spend and save your money will start to work for you.

Budgeting correctly, acquiring assets, and lowering credit utilization will save you money. You will soon have your money work for you and you won’t end up flat broke as soon as your direct deposit hits your bank account. If you implement these disciplinary financial strategies into your routine, money will grow on trees and rainy days will actually be bright and sunny. Don’t be afraid to be a little stingy here and there, it’ll take you further if you are!

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