Forming An Opportunity Belief - 4A

I believe there is a need for financial literacy in our country, especially for young adults. The lack of knowledge is getting millennials into economic hardship that if not taken care of, will set them up with a lifetime of debt. 


I am in the early 30s, and so are the majority of my friends. From past conversations, most of them have acquired debt in the thousands throughout the past ten years. This high number is primarily due to their poor spending choices and lack of proper financial education. "The greatest sources of millennial debt (35 and under) are credit cards (20%) and student loans (21%), according to a 2018 Northwestern Mutual survey. About 40% of monthly income is spent on discretionary costs – clothes, entertainment, and other non-essential items." (source) These numbers are staggering, and it makes me sad that a large number of millennials, including my friends, are in so much debt. I think the debt in this country has risen from previous years because financial education is not taught in our school system, which blows my mind! How can something that we use every day and that dramatically impacts our future, not be considered an important topic to cover in both high school and college? People like Dave Ramsey, who is a money management expert, promote a debt-free lifestyle. I've noticed that millennials are paying attention to his message, but unfortunately, it's still not a high percentage because the temptation of using their credit card is higher.


The three people I will be interviewing are young professionals (both male and female) ages 26-35 who fall into the millennial demographic. 



Andrea, age 35.

Do you currently have debt?

Yes, I have debt in the form of credit cards, student loans, car payment, mortgage, and medical bills. 

What age did you start accumulating debt?

When I started UCF, I was approved for student loans to help pay for school. When I graduated, I got my first credit card and a new car. 

Did your parents teach you about financial responsibility?

My parents weren't the best at saving. We lived a nice life growing up and probably should've saved a lot more than what we did. 

Do you know your credit score?

I haven't checked in a while, but I think it's average. 

Do you follow a budget?

I like to think I do, but if I'm honest, I really don't. If I need something and the money is in my bank account, I'll go ahead and purchase it. I try not to splurge too much though.

Do you know exactly how much your monthly financial obligations are?

I know the amount of money I need each month, but I haven't sat down to look at each expense. Most bills are withdrawn from my checking account automatically, so I don't know the exact number. That's actually something I should check because I could probably cut some expenses on things I don't really use. 

Do you regularly use your check card or credit card?

I try to use my check card as much as possible, but some months I need the help of my credit cards, especially for unexpected expenses. 

Do you have a savings or retirement account?

I have about $500 in savings right now. I'd like to get that number higher, but right now I'm focusing on paying down my debt.

Do you have a financial plan to get out of debt?

I used to do the Dave Ramsey 7 Baby Steps, which helped me pay down some bills but then I got laid off from my previous job. It made it difficult to continue. Right now, I've been focusing on raising my baby, and my husband is the only person bringing in income, but I plan to return to work next year and contribute to our bills and debt. 


I think Andrea was heading in the right direction with following Dave Ramsey's program, but unfortunately, she couldn't continue making progress. Sometimes life sends you an unexpected curveball that makes it difficult to get out of the hole you're in. I think having a budget that she can stick to will help her tremendously. 



David, age 26.

Do you currently have debt?

I only have car and house payments. Nothing else. I paid both my bachelors and master's degree without student loans. This is something I'm proud of. I use my credit cards for my monthly bills because I get points but pay them off completely each month.  

What age did you start accumulating debt?

I purchased my car three years ago and my house two years ago. I gave a 20% downpayment for my house, so I don't have to pay a PMI for my mortgage, and I traded in my old car when I purchased my new car, so that helped lower the payments. 

Did your parents teach you about financial responsibility?

Not really. I know they were smart with their money but never really sat down to educate me. Everything I know is self-taught. 

Do you know your credit score?

Yes, I have an 802. I have Credit Karma that monitors my credit for me. 

Do you follow a budget?

Yes! I breakdown my paychecks and allocate them to each of my bills and for my future. I save between 10-25% of my income to my savings/investments. I want to retire with a nice amount of money in my portfolio. 

Do you know exactly how much your monthly financial obligations are?

Of course. I am conservative with my spending and know exactly how much I can spend each month on my bills and disposable income. 

Do you regularly use your check card or credit card?

I mostly use my credit cards but only to take advantage of the card benefits. I earn points that I can redeem for cash back or travel. Credit cards are great if you're responsible and use them wisely.  

Do you have a savings or retirement account?

Yes to both. Been saving up since I was a teenager and have a nice cushion for my future. I also have a Roth IRA and stocks. 

Do you have a financial plan to get out of debt?

In two years I will pay off my car, and I'm working hard to pay to send additional principal payments to my house. I have a 30-year loan, but hopefully, it will be paid off sooner than that. Right now I don't have a financial advisor but am looking into hiring one soon. But so far I think I've done pretty well for myself so far. 

David is on the right track. We didn't discuss numbers, but from the responses he gave, it seems he's done his homework and is proactive in assuring he remains debt-free and has enough for his retirement. What helped him be where he is now was starting early in making financial freedom a priority. People should start getting serious about their finances in their 20's if possible. 



Christine, age 33.

Do you currently have debt?

I own my house, recently got a new car, some credit card debt and a lot of attorney fees (I'm going through a nasty divorce right now).  

What age did you start accumulating debt?

I never had any debt until I attended UF for my bachelor's degree. Thankfully all my student loans are paid off now. 

Did your parents teach you about financial responsibility?

They just told me to be smart with my money, but we never had a money talk. Wish they did, I probably would've made smarter choices regarding credit cards.

Do you know your credit score?

Last time I checked was when I purchased my car last in March. I had a 785, but I'm sure it's gone down from then. 

Do you follow a budget?

I work in sales and off of commission, which makes it hard to plan ahead and budget since not all months are the same. Plus I have two kids and going through a divorce, so it's sometimes difficult to even pay my bills some months. But overall, I try not to spend recklessly. I can't afford to.

Do you know exactly how much your monthly financial obligations are?

I actually do. I had to send my lawyer my detailed monthly expenses, which helped me see where I could cut back on. I canceled a few subscriptions and memberships I wasn't using thanks to that comprehensive report.  

Do you regularly use your check card or credit card?

I use both, but I lately I've been using my credit card more than I probably should. Not by choice but because out of necessity. 

Do you have a savings or retirement account?

I have a 401K that my company matches and I had to use my savings for my attorney fees. Right now, I only have about $1,000 in my savings just in case of an emergency. 

Do you have a financial plan to get out of debt?

As of right now, I do not. I need to get through this divorce first, which has already set me back over $150K! If I could give one piece of advice to anyone looking to get married... get a prenup! 



Based on my three interviews, I firmly believe financial literacy should be a high priority in people's lives. It should start in your home. Parents have the responsibly to teach their kids the importance of money. If possible, lead by example. Obviously, some circumstances are out of our control, but for the most part, people are in their current financial situation from the choices they've made. Good or bad. At the end of the day, it's not what you make but what you spend that truly matters. The responses from my three prototypical examples supported my belief that the lack of financial literacy is an issue here in the US. Companies can use the same model to test out their hypothesis or products/services and adjust accordingly.