Guide to Help Grads Start Smart


What's a little credit card debt?

"Credit cards allow you to make purchases today and pay for them later. For example, when you make a purchase, you are essentially getting a loan from the credit card company. You must pay back the money at some point in the future, usually with interest. This credit card loan can be helpful and convenient if you're running a little low on cash, but it can have devastating consequences if you charge more than you can afford to pay back." – from the book Smart from the Start Money ( by Brad Kronland and Rob Roach

Brad Kronland and Rob Roach met at Butler University as business school students studying finance. After they graduated, they both worked in Chicago as bankers until their careers took them in different directions. Several years later, they reconnected in Fishers, Indiana and embarked on a new project: a personal finance book for young adults called Smart from the Start Money.
According to Roach, the pair shared not only an alma mater, but a "passion for wanting to help people make better, more informed decisions." His perspective:

Why did you write the book?

Roach: When we graduated from college, we quickly realized how little we knew with regard to making basic decisions about renting an apartment, buying insurance or paying taxes. And we were finance majors! We couldn't imagine how challenging those decisions would be for young adults who had no business training at all. That led us to write Smart From the Start Money, to help young people build a basic foundation to make informed and sound financial decisions. We also wanted our readers to know how companies and individuals make money from the financial decisions we make every day. Knowing why someone is trying to sell you a product or service can be a tremendous benefit in protecting yourself from buying something you don't need or want.

What is the biggest financial mistake you see college students make?

Roach: Building a large balance of credit card debt while they're in school. Coming out of college with several thousand dollars of credit card debt can really create a challenging situation for a young person. It can limit their ability to save money after graduation or damage their credit rating if they have a late payment or find they are unable to repay the debt. By understanding how early financial decisions affect you later in life, you can make better choices and be better prepared in the long run.

What are two or three things college students can do to make a big difference in their financial future?

Roach: Become financially literate now. Don't wait until after you have made mistakes to learn about personal finance. Knowing the basics will help young people avoid making mistakes that can haunt them for years after they leave college. Secondly, develop a budget and begin living within it. This will help them to develop good financial habits that they can build upon as they enter the work world. Finally, create a plan for your money and know where you're spending it. Many young people and even older adults, have no real sense where they're spending their money. They just spend until it's gone. Having a plan and tracking your spending allows you to have control over your money, not letting it control you.