Brian Stone and Bukola Adesanmi presented on the fundamentals of financial literacy on Thursday, Nov. 10, kicking off a series of webinars hosted by PennWest California’s Office of Academic Success.

Stone and Adesanmi, are employed at the Consumer Financial Protection Bureau. The CFPB, according to their company web page, is a public agency that enforces federal financial law with the purpose of making consumer financial markets as transparent and responsible as possible. Adesanmi’s segment encompassed the first half of the presentation, identifying the basics of financial aid for students.

“Financial aid is a combination of things,” Adesanmi said. “It can be a scholarship; it can be a loan. It can be a grant or money that you don’t have to pay back. It can be savings that you have. It is considered any aid you use to help pay for your financial expenses.”

Some of the key features highlighted by Adesanmi included descriptions of different loan types and how interest accumulates on those loans. Options discussed included family loans, scholarship grants, and work-study opportunities. Each of these options have variable fees and terms based on the institution that they are acquired through.

“Whatever you have to rely on to fund your schooling is okay,” Adesanmi said. “The key is to always know what you’re getting into. You would need to do your own research and your due diligence to make sure you understand what type of aid you’re getting and the terms, meaning how you would need to repay it, when your repayment will become due, and how interest is accumulated from your loan.”

The second half of the presentation, led by Stone, focused on the postgraduate process of repaying student loans, and handling the debt associated with them. He examined the student debt relief plan enacted by the Biden administration, which provides qualifying individuals with up to $20,000 in compensation for college expenses. However, the majority of his focus was on the management of accruing interest and amortization, or the process of gradually paying off the costs of an asset. He stressed the importance of paying on the principle when handling student loans, referring to it as a major challenge students face following graduation.

“We talked about negative amortization,” Stone said. “You don’t want to get in the position where you’re making payments and feel like you made progress on your student loan only to find out like two years later the balance actually increased. Understand capitalization payoff, dates, your monthly payment, and make sure that that’s affordable.”

Nan Li, a professor in PennWest California’s business department, commented on the purpose of this event. The university, with funding through a Title III grant, aims annually to provide students with information on saving, budgeting, investing, managing credit, student loans, and more.

“Most students don’t know what kind of loan they have,” Li said. “There’s a lot of specific terms that people should know so that they can avoid paying more money back.”

Tyton Brunner, an academic achievement specialist who worked in collaboration with Li for this event, said that he sees students struggling with financial circumstances first-hand.

“I’ve sat down with many, many students and helped them fill out their FAFSA,” Brunner said. “They don’t know what they may or may not be eligible for, especially with managing student debt postgraduation. That’s hard on people, as you know, with the student loan debt in America. It’s one of those things where you really have to manage your money.”

Brunner said that there is a balance that students have to find between supporting themselves in the present and managing debt in the future. Students who are unaware of financial topics, such as loan opportunities and credit score, may find it difficult to become independent postgraduation.

“I don’t know how much students know about their credit and how that plays a big role in postgraduate life.” Brunner said. “You need to know your credit score. You need to know that. When you are going for an apartment or getting a house, or starting a business, you need to know these things and how credit works, especially with student debt and financial aid.”

For students just now learning this information, there may be concerns about not having enough money saved. Adesanmi told listeners that any saving is a good thing when it comes to student debt.

“When you take out student loans, every dollar you borrow you have to put back at least two dollars, and that’s due to interest and the nature of how loans work,” Adesanmi said. “But don’t underestimate the power of saving. It’s never too late to start saving for college. As much as you can save towards a college education, it will really benefit you in the long run.”