Most of today was spent on the train. We traveled to Chicago and arrived early afternoon. I went with a group to Millennium Park to take pictures in front of the Cloud Gate (aka The Bean). We then took a subway to a place called Logan Share for an evening event to listen to a speaker about proposals for improving transportation in Chicago.
Today was very low key so there is not much to say. Tomorrow I am going to Northwestern University in Evanston, IL to talk with students.
In an earlier blog post, I quoted one of our speakers that success is the management of our failures. Today, I took that theory to test. Our day was first started with an Idea Morning session hosted by one of our own participants, Jason D’Mello. We were talked to by Ann from the Stored Potential Project which involved hanging mural banners from an abandoned grain silo in Omaha to bring art into the Omaha community.
During today’s project phase I ventured out to Creighton University to talk with students. I talked with one of our on-train reporters, Robert Reid from National Geographic, about a new approach to engaging with students. I hit a 100% success rate with talking to students and had very open conversations with students. I talked with one student who was working at the school coffee shop and learned the financial difficulties of pursuing a graduate degree. Our 20 minute conversation together lead him to offering me a free cup of coffee! (Now since I am from Minnesota it comes as no surprise that the Midwest is full of genuine and giving people.)
I also talked to an individual who worked at the school’s help desk. He was drinking out of a University of Minnesota water bottle so I was immediately intrigued. I began asking questions about where in Minnesota he was from and our conversation lead to the discovery that his family friend is my sister’s best friend! It was quite evident from this encounter that we all are truly connected in some way or another. Overall the students I talked to knew very little about their personal finances and were embarrassed to admit that, but what I found was that the further along students were in their educational path the more in tune they were with their finances.
One interesting conversation I had today was with a branch manager of a local credit union who has a branch located on campus. We had an insightful conversation about what students come to the credit union for most and what the credit union does for its students. He said that they hold a seminar for students about finances when it gets close to graduation time but they don’t see a turnout that makes having the event be worth throwing. I was reaffirmed by this when I asked students about said events, and the general response was that if it wasn’t mandatory then they wouldn’t go. The interesting thing about this is that they went on to say that they would like to have a financial literacy-type class as a mandatory part of the high school/college curriculum. One piece of our conversation that really frustrated me, as well as the credit union manager, was that US Bank provides plastic cards for Creighton University’s student ID’s so they get students to sign up for a US Bank account. The ironic thing about this is that US Bank has no physical presence on campus yet they are able to encompass all of the students and get them to sign up for their account. They also link their student ID’s to their tuition bill which allows students to use their card for purchases. What they don’t explicitly say is that they are not serviced by Visa or MasterCard so they cannot make purchases outside of a school’s bookstore.
There is no easy answer to this issue as not everyone agrees with where the responsibility lies for learning about managing one’s personal finances. But this is why I am out here, to give recommendations and product/consulting ideas for universities and financial institutions to help students. The majority of a student’s upbringing is spent in a school, so why not utilize that time to inform and engage students so they can make smarter and more informed choices about their personal finances when the time comes. As there is the time value of money, there is also the time value of education. The money you invest now will be worth more in the future, just as the investment in financial education made now will return a higher yield of informed students in the future.
Our morning was started out with a talk from Erik Mitisek who is a technology startup advocate for the Denver area and the creator of Denver Startup Week. His goal is to make Denver the third large technology city in the United States. We then took a trip to Galvanize which is a place for entrepreneurs to collaborate on ideas through pillars of capital, community, and curriculum. We heard from Tami Door, CEO of the Downtown Denver Project which is is working to revitalize the downtown Denver area. We also listened to Richard Eidlin who focuses on public policy and sustainability with the American Sustainable Business Council.
We were finally able to start working on our projects this today. I started out my day by going to the University of Denver to talk to students. It turns out that there really aren’t any students on campuses during the summer in Denver so I only had one person to talk to. This student had no idea about any of his personal finances but could answer every pop culture I threw at him, and that didn’t surprise me any. I then made my way over to a tri-college village to talk with more students. I started out by talking with two credit unions on campus about what they see students coming in for help with the most. They both mentioned that confusion of loans was the biggest issues they deal with students on a daily basis. Both credit unions also offer free credit score analysis which is awesome! I then ventured out to talk with students until I was approached by an administrative staff that reported I was not allowed to speak about finances with students in that campus and they escorted me out. As far as research goes, today did not go well at all.
As I slummed my way back to our train I came across the Federal Reserve Bank that acts as a branch of the Federal Reserve in Kansas. I went inside and took a tour of what they had to offer. They had on display old currency that dates back to the early 1700’s. They also had money bags with $165 in them that they gave out for free (the catch is that the money is inked and shredded).
We are headed to Omaha tonight and will arrive by early morning. I am hoping I don’t run into any issues with talking to students as I did here, otherwise I may have to rework my project and goals.
Today was an eventful day in the beautiful Denver, CO. We started out the morning listening to Denielle Sachs who is a Director of Social Impact with McKensey Company that does work in education and health. We then participated in a Pioneer’s Journey session and worked on personal reflection of goals we have with this trip. It is nice to have time to reflect and do soul searching because it is not something I get to do on a normal day’s basis. I have found it very relaxing and that it puts me in an ease of mind from the everyday mundane tasks of life.
Following the reflection we took a walk to the Infinite Monkey Theorem which is an urban winery in Denver. What’s interesting about this place is that the owner has taken the initiative in not only selling wine in bottles but also in pop cans. This convenience is perfect for the Colorado scene so that people can bring cans of wine outdoors with them when they go camping or can enjoy wine at an outdoor sporting event in the stands. From what I heard from the other participants, the wine in the can tastes very good.
Our afternoon was spent at Taxi in Denver which is a creative space for businesses to work in. We listened to Travis Price, an incredible architect out of Washington DC, speak about the different projects he has done and his inspiration from poetry, stories, and backgrounds that influence his work. We then went outside and created our own sculpture area of out bales of hay and crafts that we made during the afternoon.
The evening was spent with a pool party and social networking event at Taxi. They have taken large shipping containers and transformed it into a pool, how awesome!
One thing I haven’t mentioned yet is the incredible chefs we have on board. Chef Sam Crocker works in a New York City restaurant owned by Jean Georges Vongeritchen whom owns one of New York’s best restaurants. We have been spoiled with incredible dishes such as prosciutto cotto sandwiches, fennel & honeydew gazpacho, and lamb burgers to name a few. He is being help by chef John who is a recent culinary school grad.
I am anxious to find out what students in Colorado know or don’t know about their finances. I am waiting for the one individual who has a captivating story to be told that sheds light on the financial illiteracy.
Today’s day was spent enjoying the sights on the train as we traveled across Utah and through the Rocky Mountains to Denver. We were joined by Ally Seeley who works for Something Independent .This is a Denver-based organization that helps shed light on start-ups and connects individuals with other resources in the area.
I also sat down and surveyed participants on the train regarding my project today. These individuals were college graduates or working towards their doctorate in their respective field. It was surprising to find out from them that they were very in touch with their finances in regards to student loans, credit cards, and credit scores. This got me thinking about the students I talked to yesterday and how much of a stark contrast the two sets of conversations were. It is an interesting thought that we are labeled as being millennials yet there is this huge difference between knowledge of finances due to age. I am hoping to go to the University of Denver and Colorado State University to talk with more students to get even more of an understanding.
This evening we were fortunate enough to receive free tickets to go see the Colorado Rockies play the Pittsburgh Pirates at Coor’s Light Field. These tickets were given to us as a donation from the Colorado Rockies so a huge thank you and shout out goes to them!
This morning was the official kickoff of the Millennial Trains Project in San Francisco. We started off with an Idea Morning session hosted by participant Jason D’Mello where there was free coffee and had guest speakers Elizabeth Gore, resident entrepreneur from the United Nations Foundation, and billionaire serial entrepreneur Karman Elahian talk about their work in entrepreneurship. One important lesson that I took away from Karman Elahian’s speech was the notion of celebrating failures and that success is only the management of your failures. We then had a 90-minute purpose-based leadership seminar hosted by Dr. Max Klau. He explained how our journey on the Millennial Train Project will change our outer world that we live, but also our inner worlds as well. We were also challenged to create our own personal mission statement, a statement that goes beyond the realm of our everyday tasks in a 9-5 work period and resonates with who we are as individuals.
Today I was able to begin gathering information from students about their personal finances. I traveled out of our hub and outward to the University of California- Berkeley where I surveyed students about their knowledge of personal finances. Overall I was impressed how willingly students were to have me come up to them and talk to them about this issue. I gathered basic information from students about their knowledge and familiarity of student loans, credit cards, credit score, and basic budgeting. I was surprised to find that most students knew the different types of student loans they had. I even ran into two students who mentioned they have already started saving for retirement…wow!
One student I interviewed that particularly stood out was a woman named Tatiana, a junior at UC-Berkeley who is from Arkansas. When I asked about her thoughts of financial literacy she opened up to me and said that it is not something her parents stress on her and that they would rather have her focus on her education first. She explained to me that her parents come from Russia and that culturally it is more important for her to focus on education and have her parents guide her with her personal finances while in school. All of the students I spoke with agreed that financial literacy is something that should be taught by schools and heavily promoted by financial institutions.
Tonight we will be enjoying a dinner at our hub location and finally moving onto our train! More updates will be coming along the way and you can follow me on Twitter @SeanKolodziej to see what I’m up to throughout the day. Tomorrow we will be in transit all day and arriving in Denver in the evening. I’m looking forward to sleeping in and being able to enjoy the landscape of the Rocky Mountains, as well as the company of the 23 other participants on this journey.
We’ve all heard about how important your credit score is when it comes to purchasing a new home or applying for a credit card, but the reality is that, according to the Huffington Post, nearly 50% of Americans don’t know what their credit score is. In this blog I will break down the components of your FICO score and give you some pointers about managing your score.
Your FICO score is the most common type of credit score that lenders use. In essence, it is a number that determines a financial institution’s risk for lending money to you that ranges from 300-850 (the higher the score the better). Don’t feel intimidated by what FICO means either; it just stands for the Fair Isaac Corporation which is the company that produces the method for credit bureaus to create FICO scores. As aforementioned your FICO score is used to determine your likeliness to receive a mortgage or auto loan, but did you know it can also be used in determining whether or not you get hired at a company?
There are 3 credit reporting agencies who report FICO scores: TransUnion, Experian, and Equifax. Each credit reporting agency reports different information so not all 3 scores will be the same. The breakdown of your score looks something like this:
- 35% Payment History
- 30% Amount Owed
- 15% Length of Credit History
- 10% New Credit
- 10% Types of Credit Used
From this there are a few things you can do to help your credit score so you can get the best interest rate possible when financing your home. The first tip I have is to check your credit score annually. By law, you are allowed one time to check your credit report for free from each of the credit bureaus but you have to pay to obtain your credit score. You can visit annualcreditreport.com to do so. Don’t check your score on your own more than once though, it can actually hurt your credit score by doing so!
The second tip I have is to reduce the amount of debt that you owe. This means limit the use of your credit card to only larger and planned expenses that you can pay off right away. Have you have multiple outstanding loans or credits in your name, use your credit report and begin budgeting to erase those negative balances.
The third tip I have is to make payments towards loans or credits cards in full AND on time. Typically you will have 25 days from when your outstanding balance is put on a statement for you to pay off you debt. Making only the minimum payments will end up costing you more money in the long run so do the best to pay off as much as you can at a time since most of us cannot afford to make a one-time $20000 payment towards a student loan for example.
FICO scores can be confusing and hard to understand so I hope this general information will enable you to get thinking what your score is and what you can do to manage it. If you would like more information about credit scores visit myFICO.com.