Th!nk smart with your refund

By: Delphina Thomas

Tribal Affiliation: Diné

Study: PhD in Justice Studies

Full disclosure: when I received my first financial aid refund, I spent it on things that I didn’t need and treated my sister and cousin on a trip to New York City. I had never received thousands of dollars at one time. I didn’t know what to do with it and ended up spending the first and last refund I received in my undergraduate career.

I realized afterward that I should have saved the money toward traveling to and from Arizona during my breaks. I could have used that toward personal expenses that came up during the semester for hygiene products I ran out of. Instead, I spent the money and worked a lot during the semester at my work-study job just to make enough money for a plane ticket home. It wasn’t until I started my master’s degree that I received another refund and I was adamant about not spending it on frivolous things like I did before. So I researched savings accounts online and taught myself about the different accounts I could open.

I decided to open a savings account with an online bank where my money could accrue interest. This was completely new to me and something I was never taught. I have had this account for four years and it has come in handy many times. Recently, I found out that State Farm offers a Money Market & Savings Account where your money accrues compounded interest daily.

One reason to open up a savings account is to create an “Emergency Fund.” These funds are especially important for students, like myself as an undergrad, who knows that they are expecting a cost toward the end of the semester and will need funds to apply to that purchase. It’s also really good for students who have unexpected costs during the semester like job loss, medical care, car repair, etc.

I never thought to save my refund, but now, as an adult with more experience, if I receive a large refund I put away a large part of it in a separate savings account with a different bank than what I use for my checking account. State Farm offers a variety of savings accounts to work with your needs and provides a breakdown of each type of funds you can use your savings for.

For more information, visit: statefarm.com/simple-insights/smart-ideas/four-kinds-of-savings