Melissa Read Memorial Scholarship Essay #2

Savings and the Importance of Where to Place your Money

Applicant: Jill Moore

The worst financial decision that I have made so far was to put most of the money I received into a savings account. This may not seem like the biggest mistake a person can make, but in my case, it has negatively impacted me in several ways.                   

     There are a couple things you should know about my money views and habits.  First, I am becoming aware of how much I have to learn about money.  I was brought up being encouraged to save money and was told I shouldn’t withdraw money from my bank account – ever. So, I didn’t – ever.  

I was told I should save money for a “rainy day” or for when I finish college and want to start my life. I don’t think I felt that the money I was saving was actually mine. Friends eventually started talking about using a debit card to access their accounts, but I didn’t have one and, for all I knew, maybe my bank didn’t even offer debit cards. My lack of knowledge just kept me in the dark. Also, the bank was located pretty far from our home, so it was never convenient to get there and I always needed someone to drive me in order to go. 

Melissa Read Memorial Scholarship #2

     So, I started out just trying to save as much as I could, even challenging myself to put more into the bank and keep less for myself. I can see now that one of the problems with saving was that my money sat in an account and barely made any interest. The interest rates are so low that the account made pocket change for interest. It was beneficial for the bank, but not necessarily for me. The bank and my money were literally and figuratively, pretty far removed from me. 

   Another thing I found was that as I started my first job, my employer strongly encouraged that paychecks be direct deposited, so I signed up for direct deposit.  I worked varying hours each week and even picked up extra hours when a co-worker needed help, but the paychecks went directly into the account, so I never saw them.

The account that I really didn’t have access to was growing, but I didn’t see it. I continued to feel like I didn’t have money when I needed it. And quite frankly, when my job asked me to work more hours, I didn’t see a good reason to work more because what was the point? I wasn’t seeing any benefit to it. I continued to have to ask my parents for money when I wanted to do things, and more often than not, was told “no” to my requests.

   The final point really hit home this year. As I was applying to colleges, my parents filled out a FAFSA form to see if I could get financial assistance from the schools. I received my acceptance letters and then the financial award letters. It was pretty shocking to find out that the money I had saved all those years was used against me. We were told our “expected family contribution”, but then we were also told that the money I had saved was automatically added to what we were expected to pay toward the tuition. I was willing to contribute toward my education all along but was surprised when I was told that my money was added to what the family already had to pay. I felt defeated and misled.

 I admit I have a lot to learn. I am determined to be smarter with my money choices as I go forward. I am preparing to start my freshman year at Northwestern University in September. I will be studying in the school of Journalism, but just as importantly, I will also be learning from the school of life. I look forward to challenging my misinformation about money, taking ownership of my decisions and becoming a better money manager. But, I also hope to avoid taking out student loans as much as possible. 


[Tom: This essay is chock full of lessons. Knowing where to place your money is just as important as saving it.

Two big lessons were learned here. 

  1. Put your money to work for you. It’s great to save but if you don’t have goals for your funds, that is a wasted opportunity. 
  2. Know the rules of financing college. A student with a big chunk of cash can hurt financial aid chances with colleges. Know the rules and then place your money in a place that makes the most financial sense. ]

Tom is a doctor, husband and father of five with a passion for parenting and finance. When he isn't skateboarding, riding BMX, or jumping on the trampoline with his kids, he is reading and writing about personal finance. He helps high income parents educate and mentor their kids to become financially, emotionally, and intellectually self sufficient.

One Response to “Melissa Read Memorial Scholarship Essay #2

  • This is a great lesson… Jill was very smart by saving, but between the psychology of not seeing her paycheck and the FAFSA rules, she learned a great lesson on saving wisely.

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