By Devin Partida
Financial literacy is vital for STEM students, as it teaches them to handle money well for challenges like project funding in their careers. Such a skill empowers these learners to make wise decisions for long-term goals like buying a home or planning for retirement. Here’s why knowing how to manage money is so important in STEM.
Why Should STEM Students Learn Financial Literacy?
Learners who decide to explore science, technology, engineering and mathematics are currently positioned to make a good amount of money. While jobs like environmental scientists and conservation technicians earn $43,000 to $50,000 annually, petroleum engineers and information systems managers stand to pull in $145,000 to $162,000. With the potential for such earnings, it’s crucial for STEM students to learn how to manage their funds.
Financial literacy is essential for keeping track of all the money they stand to make as industry professionals. Additionally, certain positions make a more modest wage, so learning how to manage their salary along with life’s other expenses will highly benefit them. When someone learns financial literacy, they learn ways to stretch their dollar and compound their savings, setting themselves up for success now and later in life.
Financial Scams Targeting STEM Professionals
Research shows 75% of American teens need more confidence in personal finance knowledge. In today's digital age, being financially literate is essential for spotting and avoiding scams targeting STEM professionals. Educators should teach STEM professionals to be cautious and skeptical about unsolicited communications to avoid common threats. Such scams include:Bogus conferences or seminars: Be cautious of invites to unknown meetings or workshops. Confirm the event's authenticity, and only share personal or financial details with proper confirmation.
Fraudulent investment opportunities: Be wary of seemingly too-good-to-be-true investment offers. Research thoroughly and stay skeptical of promises of high returns.
Collection agency scams: Stay cautious about collection agency tactics that create urgency. In 2022, people reported nearly $8.8 billion in fraud losses, with impostor scams ranking as the most typical. Know legitimate collection processes and verify debts before sharing personal or financial information.
Impersonation of reputable organizations: Be alert to scammers pretending to be well-known organizations or colleagues. Double-check the identity of anyone contacting you, especially for financial matters.
How STEM Learners Can Use Financial Literacy
Naturally, those reasons equal substantial benefits. Here are just three ways those with a STEM degree can use f their financial literacy skills.
Budgeting helps students wisely use limited resources for education, projects and personal needs. It's a tool to reach financial goals, whether saving for research, managing living expenses when they go to college or saving their employer money.
2. Practical Budgeting Tips
Practicing these budgeting basics helps students manage their finances effectively, ensuring stability during their academic journeys:Clearly outline income sources like grants, part-time work and expenses such as tuition and materials.
Separate essential and non-essential expenses, focusing on necessities.
Set aside money for unexpected costs, creating a financial safety net.
Regularly check and adjust the budget to stay adaptable to changes.
3. Understanding ROI
STEM professionals are in a unique field where they may get the opportunity to invent products. However, it’s vital to know if that development stands a chance of earning money. If you invest all a company’s time and financial resources into an offering no one is interested in, it doesn’t exactly spell success for its future.
Learning how to find the return on investment (ROI) saves them from accidentally wasting funds where their employer can’t afford to. Additionally, they may need to calculate the ROI before getting approval for the project. Other areas where knowing how much your investment will pay you back benefits STEM students include college degrees, stocks, housing and more.
Preparing for Leadership
As STEM professionals go on in their careers, they may find themselves in higher-up positions where they must know how to manage corporate finances. With strong knowledge of what makes a good investment, when an enterprise needs more employees and how much to allocate to various departments, they can help their business thrive.
Financial Literacy Is Crucial for STEM Students
Prioritizing financial education equips learners for their current pursuits. It sets the foundation for a secure and prosperous future in STEM fields. Educators should advocate for financial literacy education so they can give their students the tools they need to succeed academically and financially.