by Cyan Baker
Every college graduate needs to understand how to manage their finances. As an engineering major, this is typically not taught to you as thoroughly as Physics or Dynamics.
At my former university, I was fortunate to be offered a financial literacy course, Wealth Management for Engineers. This was a fairly new class suggested by a professor who took it upon himself to educate engineers since they earn one of the highest starting salaries and oftentimes don’t know how to budget appropriately. According to the New York Times, engineering majors earn an average starting salary 37 percent higher than the average starting salary earned by people who majored in history or the social sciences, proving that engineers need to learn how to manage their wealth early on to make their money work for them. 22% of the world’s top 100 billionaires studied engineering (Crimson), and to become one of these billionaires you need to learn how to manage your finances.
Use your free time to start researching the topics above and take advantage of the resources available to you on campus. Start by creating a budget for your ideal incoming full-time position, allocating how much of your pay will be going to retirement savings, emergency savings, and expenses. If you need help determining typical expenses, the Economic Awareness Council offers a sample Weekly Budget Ledger on their website (https://www.econcouncil.org/resources) or ask one of your professors. This conversation may even lead to a lesson about tips and tricks to making your money work for you in your career.
Unfortunately, financial literacy courses are not standard for most engineering programs even though there is a growing need. Don’t let it stop you from being financially successful! Rick Blair, the Vice President and General Manager of Turner Construction’s Great Lakes Region, suggests for engineering graduates to “start your 401k as soon as your company allows and diversify the risk of your investments. Starting early allows this to become a part of your budget. Also, maintain a good credit score by paying your bills on time, allowing you to make the most of your future large purchases.” Like my professor said, “It takes multiple generations to build family wealth and only one to tear it down.”