Bold Financial Literacy Scholarship

One of the most helpful pieces of financial advice I have ever received is to invest a portion of my income when possible. Thanks to the education that I have received through my business administration courses from Chaffey College and expert testimony from real life business professionals who have discussed this topic on outlets such as YouTube, I feel extremely hopeful about my future. Unfortunately, in High School nobody told me about the power of investments. I worked several jobs in the food industry, and although I got by, I felt that I never really was getting ahead financially, despite my hard work. I made sure to spend only what I knew I had and tried to make frugal choices when possible. I tried budgeting, but between health care costs, the costs of maintaining transportation, rent, and college tuition, I was living nearly pay check to pay check with little saved for emergencies. As a 23 year old, I have many years of work and income generation ahead of me. After learning that, for example, over the long term, investing in a simple market index fund on a regular basis can result in exponential wealth building. This is because, historically, a market index fund, encapsulating the entire stock market, can on average yield anywhere between a 7-12% return per year, with dividends reinvested. Fortunately, there are many brokerages to choose from, and now it is easier than ever to invest. This is because I can access my personal financial portfolio all through my smart phone. I can move funds from my checking account through my bank into my investment account with ease. As such, I have made it a habit of mine to invest a small portion of every check that I earn through work into my investment account.

Albert Einstein said, "Compound interest is the most powerful force in the universe." In the realm of finances, the most important I have learned is investing. Investing is complicated; it is logical and it takes patience. In investing, I learned the importance of diversifying, buying stocks, and long-term investments. The first piece of investment advice I learned was my portfolio; I couldn't have all my eggs in one basket. Today influencers are pushing many to purchase only bitcoin or real estate. While these may be good investments, they are not 100% safe. I have witnessed the wisdom of diversifying my portfolio across an range of stocks versus investing into only one. No matter how high-yield an investment is, if it drops you lose all of the money you invested, so you must diversify. "But low, sell high," Warrren Buffet once said. As simple-sounding as it is, many people jump onto the bandwagon with stocks and join the countless victims when it crashes. I learned to hold off on buying a good stock until the price dropped, then buy and sell for a higher value later. While this involves years before seeing any profit, it is a safe way to earn steady income. Yes, there have been great leaps to wealth done by the lucky few, but the majority of the wealthy have earned their income long-term. Long-term investments, like mutual funds, employ the power of compound interest. Like a logarithmic chart, the returns are not great at first, but they gain traction over time. There is no consistent get-rich-quick scheme, there are only reliable long-term investments. Financial freedom means a lot to me, and investing has been a priceless lesson. From diversification to buying stocks to long-term investments, investing will always be the greatest finance lesson I have ever learned.