ISD Editorial Board

Financial literacy.

Sounds boring, right? Maybe you should skip to another article with a sexier headline or a full-color photo, right?

Wrong. Financial literacy could determine whether you retire at 50 to a tropical island and a life of beaches, boats and Bacardi mixers; or whether you work until you’re 70 and live off Social Security [which by that time, it is projected, will be insolvent — so don’t count on it].

The way you handle your credit cards, loans and investments will have a dramatic impact on the course of your life.

Sure, nearly all of us took some form of home economics in high school where we learned about checking accounts. But many of us remain seriously uneducated when it comes to personal finance.

Sallie Mae, the sister of Fannie and Freddie that specializes in student loans, recently published a study about how undergraduate students use credit cards, and the results are pretty alarming.

On average, undergraduate students have 4.6 credit cards, and a full 84 percent of undergrads have at least one credit card. The average balance on students’ cards is $3,173. Only 18 percent said their cards are regularly paid off each month. The other 82 percent carry balances on their cards, paying finance charges and interest.

And credit cards are just one small piece of the financial literacy puzzle. Then there are car loans, student loans, mortgages, credit scores, investments, 401k’s, taxes, insurance plans and more.

It’s enough to cause a domino effect that’ll put your brain into a financial crisis for the next three to five years.

But you need to snap out of it.

If you think that balancing your checking account requires finding its center of gravity, if you think a 1040 is a trucker call sign or if you think compound interest is when you hang out with the same cute guy or girl three nights in a row, then you should seriously think about getting on board the financial literacy choo-choo train.

Luckily, there are quite a few resources around Iowa State that can help.

The College of Business is halfway through a series of financial literacy seminars held from 6:30 to 8:30 p.m. in Carver Hall, room 101. Tonight’s topic is student loans, financial aid and FAFSA. The clinics are free and open to the public.

A one-credit online personal finance course, Personal Finance in Early Adulthood [HD FS 183X], and its three-credit big brother, Personal and Family Finance [HD FS 283] are offered each semester to fill students’ empty class schedules and empty — at least when it comes to finances — heads.

Then there’s Doug Borkowski, director of the Iowa State Financial Counseling Clinic. You might have heard of him — he e-mails you every Friday. But that’s not all he does. He also teaches one of the above-mentioned classes, puts on financial literacy workshops and helps students consolidate debt, file their taxes, budget their money and dispute errors in their credit reports.

If you’re behind the curve when you graduate, it’s much more difficult to catch up. So take advantage of these resources while they’re at your disposal. Get all the financial advice you can. It may take some time or effort, but it’s worth it.