Prof. David Offenberg instructs students on personal budgeting.
Recent CBA Graduates Receive Personal Finance Instruction to Guide Them Through Current Economy
Like most people, finance professor David Offenberg has kept a close eye on the fluctuating economy. He’s confident about his own financial security but has been concerned about his former students. He therefore invited them to attend a seminar on Sunday, Nov. 9, to discuss their entrance into the workforce, their economic choices, and how to plan for the future.
“It’s incredibly important for recent graduates to understand the current state of the economy and how that affects their personal budgeting,” Offenberg said. “I was overwhelmingly concerned with the trials they are facing and was compelled to discuss with them how to plan, budget and save because, in this environment, guidance is vital.”
While most alumni were able to find jobs following graduation, some are still looking; all are concerned. Those who now have a regular income are trying to navigate their careers, save, invest and, in some instances, simply survive financially. They came for guidance and were given a list of action items for mastering a budgeting process that will help them plan for the future. Offenberg told alums that before they can even think about investing, it is critically important to track their spending habits to find out exactly where the money goes, whether it is for rent, food, gas, clothing, or entertainment.
“It takes one month to follow where and just how much money is spent,” Offenberg said. “Once the receipts are calculated and you see exactly where the money goes, you can decide what’s important and what’s not and if you’re living within your means.”
Brian Barclay, an LMU alum and investment consultant from Ameritrade, then counseled the group on investing and outlined their financial and retirement options. “As your life changes, your investments should change with it, so you should review your portfolio periodically,” he said.
Seminar attendees were also told that their cash holdings should be managed in a more efficient manner by placing them in CDs, IRAs, and money market accounts in order to maximize their return. Barclay recommended keeping as little money in checking accounts as possible to avoid unnecessary spending. He also emphasized that everyone should contribute to their company’s 401K plan and make use of their employer’s matching funds. According to Barclay, diversifying one’s portfolio — both in and out of their 401K — will minimize financial risk. In addition he advised attendees to take advantage of low stock prices and buy now. “Stocks are on sale and today is the best time to invest,” Barclay said.
Those in attendance came for financial advice that’s often either unavailable or unaffordable. Alejandro Hinostroza, who graduated from LMU in May, noted that, “It’s hard to get sound financial advice. No one is willing to do it for free or offer up their time. This was therefore a unique opportunity where I learned how I can benefit from and survive in this economy.”
Benet Heams and Anna Marie Janisse, also 2008 graduates, echoed his sentiments. “I was reminded that I need to act now to plan for my future. I’ve realized that long-term goals come fast and I’m motivated to use what I learned to make my life better,” Janisse said.
“I’m new in the workforce and I’m just now having the opportunity to invest but I have no idea what I’m doing,” Heams confessed. “I need the confidence I learned tonight to make stronger and better financial decisions.”
Attendees left the seminar with two simple, practical recommendations that can be implemented almost immediately. First, have a cash reserve to cover set expenses for 3 to 6 months, which will allow you to continue living your current lifestyle should your financial circumstances go awry. And two, protect your number one asset: namely, yourself and your ability to make money by having the proper benefits package in place.
For details, contact David Offenberg at doffenberg@lmu.edu
Nov. 13, 2008