Assignment 31: Determining Causes And Effects Draft Version

Assignment 31 Determining Causes And Effects Draft Versiondue Week

Select one (1) of the following scenarios on which to focus your cause and effect paper. Research the topic and include credible sources to support claims. Identify your purpose clearly, incorporate audience needs, establish a desired tone, and organize information/claims effectively.

1. The President of Strayer University has asked you (a full time university professor) to write about the major causes and effects of stress on college students. The paper will be presented to senior administration in order to help students have a more positive college experience.

2. The director of your state unemployment agency has asked you (a public relations specialist) to write about the causes and effects of unemployment on an individual/family. The paper will be presented to the agency as they make decisions about reaching out to those who need jobs.

3. The CEO of Bank of America has asked you (a financial analyst) to write a paper on the causes and effects on not keeping a personal budget. The paper will be presented to the communications department of the company so they can create budget forms for customers.

Write a four to five (4-5) page paper in which you: Provide a clear thesis statement. Describe the major cause. Describe a leading second cause. Describe two (2) economic effects of the cause. Describe two (2) effects on people. Develop a coherently structured paper with an introduction, body, and conclusion. Provide three (3) relevant and credible sources to support claims. Note: Wikipedia and other Websites do not qualify as academic resources. Your assignment must follow these formatting requirements: Be typed, double spaced, using Times New Roman font (size 12), with one-inch margins on all sides; references must follow APA or school-specific format. Check with your professor for any additional instructions.

Include a cover page containing the title of the assignment, the student’s name, the professor’s name, the course title, and the date. The cover page and the reference page are not included in the required page length. The specific course learning outcomes associated with this assignment are: Associate the features of audience, purpose, and text with various genres. Recognize the elements and correct use of a thesis statement. Recognize how to organize ideas with transitional words, phrases, and sentences. Incorporate relevant, correctly documented sources to substantiate claims. Apply the writing process to develop various writing genres. Write clearly and concisely about selected topics using proper writing mechanics. Use technology and information resources to research selected issues for this course.

Paper For Above instruction

The impacts of not maintaining a personal budget can be profound, influencing individual financial stability, economic behavior, and overall well-being. This paper explores the primary causes of neglecting a personal budget, the secondary factors that exacerbate these issues, and the economic and personal effects stemming from such financial mismanagement. Understanding these causes and effects is essential for developing educational tools and policies to promote financial literacy and responsible money management.

Introduction

In today's complex financial landscape, personal budgeting is a vital skill that ensures financial health and stability. However, many individuals neglect this fundamental practice, often due to various underlying causes. This oversight leads to significant consequences, both economic and personal, affecting individuals’ ability to manage debt, save for the future, and maintain psychological well-being. This paper aims to examine the major causes of neglecting a personal budget, identify secondary causes, and analyze the resultant economic and personal effects.

Major Cause of Not Keeping a Personal Budget

The major cause of not maintaining a personal budget is the lack of financial literacy. Many individuals either lack proper knowledge about financial planning or underestimate the importance of budgeting. A survey by the National Endowment for Financial Education (NEFE, 2018) found that a significant portion of adults are unaware of basic financial principles, including the importance of tracking expenses and planning for future needs. This lack of knowledge results in haphazard financial decisions, overspending, and an inability to plan adequately for future expenses. Consequently, individuals often find themselves in debt or unable to save, exacerbating financial instability and increasing stress over financial issues.

Secondary Causes That Contribute to Financial Neglect

Secondary causes that contribute to neglecting a personal budget include psychological factors and lifestyle choices. Emotional factors such as impulsivity, stress, and denial about financial realities significantly influence consumer behavior. For example, impulsive spending is often driven by emotional needs rather than rational financial planning (Loibl et al., 2015). Additionally, lifestyle inflation—where individuals increase their spending as their income rises without adjusting their budget—further impairs their ability to maintain a budget. Such secondary causes often reinforce the primary issue of financial ignorance, leading to persistent financial mismanagement.

Economic Effects of Neglecting a Personal Budget

The failure to keep a personal budget has notable economic consequences. First, it contributes to personal debt accumulation, which can ripple into broader economic issues, such as increased default rates on loans and credit. When individuals overspend without control, they tend to rely heavily on credit cards and loans, leading to higher interest payments and decreased savings (Lusardi & Mitchell, 2014). Second, widespread neglect of personal budgeting can affect economic stability at the macroeconomic level. Increased debt levels among consumers can dampen economic growth as household spending declines. Additionally, the higher propensity for default and insolvency can strain financial institutions, impacting the economy at large.

Effects on People

The personal effects of neglecting a budget are equally profound. Financial stress is a common consequence, leading to anxiety, depression, and a decline in mental health (Xiao & Noring, 2016). Such stress may impair decision-making abilities, creating a vicious cycle of poor financial choices. Moreover, individuals who fail to budget effectively often experience difficulty saving for emergencies or retirement, which compromises their long-term financial security and quality of life. The lack of financial control can also strain personal relationships, especially with spouses or family members, as money disagreements become more frequent and intense.

Conclusion

In conclusion, neglecting personal budgeting stems primarily from a lack of financial literacy, compounded by lifestyle and emotional factors. The economic repercussions of this neglect include increased individual debt and potential macroeconomic instability. On a personal level, the effects include heightened stress, reduced savings, and strained relationships. Addressing these issues requires greater financial education and behavioral interventions that promote responsible financial habits, ultimately fostering economic stability and improved well-being for individuals.

References

• Loibl, C., Hira, T. K., & Koonce, P. (2015). Financial literacy and impulsive spending. Journal of Financial Counseling and Planning, 26(2), 94-105.
• Lusardi, A., & Mitchell, O. S. (2014). The economic importance of financial literacy: Theory and evidence. Journal of Economic Literature, 52(1), 5-44.
• National Endowment for Financial Education (NEFE). (2018). Financial literacy survey. Retrieved from https://www.nefe.org/research
• Xiao, J. J., & Noring, M. (2016). Financial stress and mental health: A review. Journal of Family and Economic Issues, 37(2), 219-235.
• Loibl, C., Hira, T. K., & Koonce, P. (2015). Financial literacy and impulsive spending. Journal of Financial Counseling and Planning, 26(2), 94-105.
• Lusardi, A., & Mitchell, O. S. (2014). The economic importance of financial literacy: Theory and evidence. Journal of Economic Literature, 52(1), 5-44.
• Xiao, J. J., & Noring, M. (2016). Financial stress and mental health: A review. Journal of Family and Economic Issues, 37(2), 219-235.
• Federal Reserve. (2020). Report on the economic well-being of U.S. households in 2019. Retrieved from https://www.federalreserve.gov/publications
• Financial Literacy and Education Commission. (2017). Financial capability in the United States. U.S. Treasury Department.
• Van Rooij, M., Lusardi, A., & Alessie, R. (2011). Financial literacy and retirement planning in the Netherlands. Journal of Economic Psychology, 32(4), 591-608.