ONLINE EXCLUSIVE: Keeping Steady in a Shaky Economy

Financial stability in this shaky economy is something students can maintain with planned budgeting and saving. (AP Photo/Julio Cortez)

By Emeli Warren, publicist & copy editor | English major

The National Bureau of Economic Research didn’t officially use the term ‘recession’ to describe the economic situation until 2007, despite the fact that many Americans believe the recession to have started much earlier. The term “recession” actually means a period of temporary economic downfall, but how long does temporary last? Realistically, preparing for the long haul wouldn’t be considered overly cautious. It is the job of the student to decide what their economic identity will be when faced with wavering financial stability.

Jessica Walker, a May 2009 marketing APU graduate, now works as the associate director of High School Life at Coast Hills Community Church in Aliso Viejo, Calif. She reflected on her first week at APU and her preconceptions of the job market compared to her current situation.

“I remember being told as a freshman at the School of Business orientation that I would be making $50-60,000 upon graduation,” said Walker. “So, having that number set in my mind made it a little shocking to realize that was pretty unrealistic in 2009.”

Walker considers herself blessed, as she was able to avoid moving home after graduation. Still, she understands the necessity to keep up on her finances during the nation’s economic recession.

Walker described her economic identity as “safe.” She urges students to put 10 percent of every paycheck into savings and to use Mint to manage their budgets. The website provides free services for bringing all open bank accounts together on one site, automatically categorizing transactions. The program even aids in setting up budgets and savings goals. Even though Walker is still in her 20s, she is already researching individual retirement accounts, or IRAs.

It is her job that allows her to feel comfortable, and not in terms of financial security.

“I am definitely called to be where I am and the money is not why I’m there,” said Walker. “The Lord definitely knit the whole thing together.”

Rick Givens, professor of consumer behavior and director of alumni and parent relations, is worried about the current situation for soon-to-be graduates despite success stories like Walker’s.

“The ‘American dream’ has been really whitewashed to the point that when you graduate from college, that job you’d hoped you’d get where you’d be competing with other 22 or 23 year olds, you’re now competing with second and third career people,” Givens said.

Givens refers to college students as a unique audience. He has his consumer behavior students keep a finance log for one month to track their spending.

“There is a wide spectrum,” said Givens. “One person is on a grocery budget, while the other is starting a business. It isn’t cookie-cutter. [Overall] the group is not saving.”

Twentysomethings.Inc, is a young adults marketing consultant firm that gives insight to youth as a target market, conducting surveys for their research. In a survey released in May of 2011, Twentysomething.Inc reported that 85 percent of recent college graduates will move back home. This is a 14 percent increase since the same survey was conducted in 2006.

However, it is no wonder that students seek refuge in their parent’s home. Todd Ross, director of student financial services, noted that the average APU student graduates with a debt of $25,000. Although he says this is similar to the debt of college students across the nation, the national average was $15,000 only three years ago in 2008.

Although the financial aid budget can’t accommodate everyone’s desired amount of aid, 85 to 90 percent of APU students receive some sort of financial aid.

“You can’t look at the price,” said Ross. “It’s not as much about a price tag but rather about how APU shapes you as an individual.”

Beyond the financial hardships that students might face, there is a way of managing their seemingly unavoidable debts.

Special Direct Consolidation Loans Plan from the U.S. Department of Education will start in January 2012 and last until June 30, 2012. The government student aid portal, at www.studentaid.ed.gov, says that this special loan ensures that a borrower “will pay less interest over the life of the loan than they would under the traditional consolidation program.” Borrowers, or people who have taken out any type of loan, can manage their debt with the program because it condenses all of a students loans no matter the source. With this program, loans can be paid and organized in one online location. If people are eligible, a Department of Education Servicer will notify them in January 2012, making sure they take advantage of the program before it’s too late.

Hannah Weiner, a senior English major, is accustomed to living in varying economic situations. She has lived in the U.S for most of her life, but was born in France and went to school in Canada before transferring to APU. After graduating this December, she plans to move to Kuwait in January to teach English.

Weiner mentioned the lavish lifestyle that inhabits the oil-rich country of Kuwait. She is worried she might face a battle of self-entitlement because of her future amenities and the amount of money she plans to make.

“I can’t forget the mission trip experiences I’ve had before that have taught me that living with less, living simpler, is often happier,” said Weiner. “So perhaps I won’t be affected.”

Despite the increased income that might be available to her, Weiner still says she doesn’t want to lose her sense of planning and saving.

“My plans are to budget, live well below my means, and work as many hours as are available,” Weiner said.

As someone who predicts her financial life post-graduation to be a “scary squeeze,” Weiner did mention that she already has frugal spending habits to help her maintain a sense of stewardship for her economic identity.

“I find myself falling prey to the ‘voices of the culture,’ which tell me I need to buy more, to look better in this way and that…I’m afraid I might just go on spending binges when the economy bounces back,” Weiner said.

However, Weiner is focused on staying on track.

“I set aside as much of my earnings as I can each month to a savings account,” said Weiner. “I strive to spend as little as possible, to be as creative as possible with as little as possible.”

Senior cinematic arts major Nick Springer already has freelance jobs organized to fill his impending free time. If he could choose one word to describe his spending habits, he would choose “saving.”

“I’ve always saved [money]. I’ve never really felt the impact of the [recession],” said Springer. “I don’t really spend money on smaller things because I typically save up and spend a lot of money all at once. But even that is very rare.”

Despite the fact that he is already doing freelance work with both Moving Colour and DR Productions, he wants to find a steadier studio job in order to prepare for being on his own.

“Things will get tighter financially because I’m not going to get backed up by my parents anymore – with rent and that kind of stuff,” said Springer.

To help keep track of this saving, Springer uses a software program called Quicken, in addition to monitoring his finances through online banking. Similar to Mint, Quicken helps you budget and shows the various categories where you’re spending money.

Despite the help that technology can provide, holding steady confidence and staying prepared in such a shaky economy is more than just about the amount you spend. Through saving you can truly understand the value of the things you purchase. This allows for a healthy economic identity, ensuring that you avoid finding a sense of self-concept in financial standing.