Future Portfolio

In the second unit of the Econ class, which is called Wealth and Wages, the class learned about economic systems and studied how wealth is distributed through markets and governments. For the action project, we were assigned to create a personal investment portfolio. The purpose is to see how we take a certain amount of money, and invest it in stocks while seeing how that stock is doing. We were also asked to add SMART goals to layout what our incentive is to invest. It was interesting making this portfolio. I had a hard time understanding this whole stock process in the beginning, but with more research, I was starting to understand. I’m proud at how I took the time to do good and accurate research, in order to get a good portfolio. I hope you enjoy looking at my portfolio!

There was a certain scenario that we had to work with in this project. We had a college plan that was created 18 years ago by our guardian angel, with $18,000. Each month, $50 was added to the plan ($600 yearly). After 18 years at an average annual interest rate of 7%, compounded annually, the plan is now worth $49128.87. Yesterday, you cashed out your plan and deposited the money in a brokerage account to invest on your own.

In order to see if a stock is worth buying, I’ll look at the value. I want to see what’s low, and then sell it higher. I chose to have a longer time horizon because of my SMART goals. It’s going to take awhile before I can achieve them, but I’m totally up for it. I took a quiz online with the Rutgers New Jersey Agricultural Experiment Station, and I scored a 25, which means I have a average/moderate tolerance risk. Below, I have my goals listed for 1 year, 5 years, and 25 years.

1-year goal: Save about $15,000 to travel for one full summer.
5-year goal: Put a down payment of $10,000 for an Audi.
25 year goal- Buy a home in Lincoln Park: $350,000

I value companies that are family owned because there is a personal touch added to that company. It’s also easier to control that company and figure out the outcomes for that business. Another reason why I value them, is because those kind of companies value and understand the lifestyle of a larger family better, so they’ll do their best to meet their needs.

Company 1- Walmart.
I decided to invest in Walmart because other companies and retailers have tried to go head to head with Walmart, but have not been able to compete with their low prices. Their buying power has made their economic moat wide and sustainable. I also appreciate their mission which is, “Saving people money so they can live better”. It’s an international business, and it’s expected that Walmart will keep on making acquisitions internationally as time goes on to boost growth in the global market. They have a healthy payout ratio of 42.89%, which means that it has the potential to keep or increase its dividends.

Company 2- Walt Disney.
I decided to invest in Disney because it has an excellent growth rate. It gets that rate from its movie studio, business segment, consumer merchandise and theme parks. It’s also a top 10 stock. While doing my research, I discovered that it has a 10 year dividend growth rate of 23%. It also has a reasonable p/e ratio of 18.

Company 3-TJX.
The company TJX owns stores like TJ MAXX, Marshalls, and Homegoods. This company takes in name brand products that didn’t sell, and put them at a lower price in their department stores. Their highest earning revenue comes from their housing products because of the housing market recovery. It’s profit growth is expected to be 10%, while other department stores have only a single digit number when it comes to their growth.

1 year portfolio
I invested $15,000 in my one year goal.
30 shares of Wal-Mart at $70.11($2,103.30)(28% profile)
60 shares of TJX at $73.66($4,419.60)(72% profile) WMT and TJX together, has an expected ROI of 24.92%

5 year portfolioI invested $10,000 in my 5 year portfolio 

50 shares of Disney at $93.71 ($4,685.50) (30%)
22 shares of Wal-Mart at $70.11 ($1,542.42)(70%) DIS and WMT together, has an expected ROI of 389.27%

25 year portfolio
I invested $350,000 for my 25 year goal.

70 shares of TJX at $73.66($5,156.20) (60%)
50 shares of Disney at $93.71($4,685.50) (40%) TJX and DS together, has an expected ROI of 11681%.

I made three different investments, and 2 of them are in the same stock sector. Wal-mart and TJX is listed under consumer goods, and Disney is put under Entertainment. While deciding, I wanted to have at least one different stock in a different sector, which is one of the reasons why I chose Disney. Based on the math I did, I'm going to be able to reach my goals.

Citations:

Weil, Dan. "Best Investments: Good Investments In 2016 And Beyond | Bankrate.com." Best Investments: Good Investments In 2016 And Beyond | Bankrate.com. N.p., n.d. Web. 30 Oct. 2016.

BasuMallick, Chiradeep. "5 Reasons Why Disney Is a Must-Have Stock."TheStreet. N.p., 02 Sept. 2016. Web. 30 Oct. 2016.

Rossolillo, Nicholas. "Is Wal-Mart a Good Dividend Investment?" The Motley Fool. N.p., 01 Jan. 1970. Web. 30 Oct. 2016.

Nurse or Social Worker?

The first STEAM course in my senior year is called Economics. In this class we discussed opportunity cost, learned how to calculate interest, and learned how to work with matrices. We also looked at supply and demand, and saw how that works on a graph. The FE for this unit was really interesting. We went to the Federal Reserve Bank to talk about what they do there, and what they do for the economy. For the first action project, the class was assigned to choose a career we could see ourselves getting into, and figure out the cost of our college tuition, salary, and how long it would take us to pay off students loans. For my project, I did research on two careers that I have though about going into. As you read my essay and look at my graphs, you'll figure out which occupation I end up choosing. I hope you enjoy reading!

To continue my education next year, I can go either go to Illinois State University for nursing, or I can attend University of Illinois at Urbana Champaign for social work. Nurses have the duty of taking and planning medical care for mentally or physically ill patients. Social workers have the role of helping people get through and cope with problems they go through everyday. Nurses can work in hospitals, clinics, and even homes. Social workers can also be found in hospitals, as well as in schools, mental health clinics, and child welfare and human services agencies.

Something that these two career paths have in common is that they involve helping other people, and making sure others are feeling their best,which is why I chose them. My aunt is a nurse, and I love hearing her heart warming stories, as well as her scary ones. Social work interests me because I think something needs to be done about how mentally ill patients are treated, and it would be cool to be apart of that change. To be a nurse, I must go to college for 4 years to get my bachelor of science in nursing (BSN) degree. In order to become a social worker, I have to go to college for 4 years and get a bachelors degree in social work (BSW).

Pursuing my education also means spending some more money. In 2015-2016 the cost of tuition at Illinois State was $13,664. The cost for 2016-2017 comes out to be $14,062. That means the tuition percent increase comes out to 3%. At the University of Illinois at Urbana Champaign, tuition for 2015-2016 was $12,036. For 2016-2017, it comes out to be $15,698. The tuition percent increase comes to 30%. If I were to go to ISU for 4 years, my cost would be $60,464.98. For the University of Illinois at Urbana Champaign, the total for 4 years would come out to be $127,430.67.

(Nursing)

(Social Work)

If I choose to go to nursing school, it would take me 9 years to pay my student loans, and the true cost of college would be $75,574,11. The amount of interest I would pay would be $15,109.13. The true cost of college for social work comes out to be $188,561.58. The interest I would pay is $61,130.91. If I choose to go to school for social work, it would take me 17 years to pay off student loans.

The minimum salary for nursing is $44,70, the median is $83,291, and the maximum is $104,276. For a social worker, the minimum is $46,836, the median is $52,945, and the max comes out to $59,340. For nursing I would make $3,888,269 by the time I retire. If I were to become a social worker, I would make $2,458,152. Going to school to become a social worker cost more, yet I would be making less. In the United States there are 3,129,452 registered nurses (RN). The total amount of social workers in the U.S comes out to be 650,000. Nursing and social work both are expected to grow 19%, and are considered to be one of the most fastest growing careers.

(Salary for Nursing)

(Salary for Social Work)

People will always be getting sick, and there will always be problems that are taking over people’s lives, so the demand for both occupations would be set high. Below I have a supply and demand chart for both occupations.

Supply and demand chart (Nursing)

Supply and Demand chart (Social Work)

At the end, I realized that it would be best for me to go to school for nursing. Like I stated before, tuition would cost me less, and I would be making more money at the end, whereas going to school for social work, would cost me more, and I’d be making less. It would also take me more time to pay off my student loans if I were to choose social work. So my incentive would be the amount of money I would be making for nursing. I talked to my mom about all this because I wanted to hear about her college experience, as well as some advice. She talked about how it was hard, and how she did pull many all nighters, but at the end it’s totally worth it, because now she actually enjoys going to work because she loves what she’s doing. I really liked what she said, because although I know it’s going to be hard, I know it’ll be worth it when I’m at work and I’m actually enjoying what I’m doing.

I made 3 assumptions about my decision to go to nursing school:

• I’ll be a productive member of my community
• It’ll be easy to find a job, because I’ll have a BSN.
• I’ll find a job in the hospital that I want to work in.

Citations:
"Total Number of Professionally Active Nurses." The Henry J. Kaiser Family Foundation. N.p., Apr. 2016. Web. 26 Sept. 2016.

"Social Work Profession." Social Work Profession. National Association of Social Workers, n.d. Web. Sept. 2016.

"Tuition." , Illinois Admissions. University of Illinois at Urbana Champaign, n.d. Web. 28 Sept. 2016

"Tuition Rates." Home. Illinois State University, n.d. Web. 28 Sept. 2016.