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BC senior is NYS InvestWrite champion

Filed in Student Spotlight by on March 9, 2020

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Combining solid investment strategy with social responsibility, Bethlehem Central High School senior Maggie Reynolds is now an award-winning financial analyst after her sound recommendations on behalf of a non-profit organization earned her first place in New York State in the national InvestWrite competition. Reynolds’ work also earned her a seventh-place finish nationwide.

The Fall 2019 InvestWrite competition required students to write an essay describing a dream they hope to achieve. Essays laid out a financial plan to pay for their dream with a pitch to a panel of virtual investors. Students had to identify stocks, bonds or mutual funds that could be included in a portfolio to grow their investors’ seed money to fulfill their dream. Reynolds submitted an essay (see below) outlining short- and long-term investment advice for the Albany-based immigrant and refugee services agency RISSE. Using a virtual $750,000 investment plan that included predictions of a stock market correction and economic recession, she described ways her investments could help the organization expand its reach.

Reynolds was awarded the first-place trophy, along with prizes valued at $200, by InvestWrite sponsor SIFMA, the Securities Industry and Financial Markets Association, on February 26.

The non-profit Reynolds chose for her virtual investment plan, RISSE, provides language, literacy and life skills to refugees and recent immigrants to the United States. Her strategy, she said, was to help RISSE purchase the building it uses in Albany and possibly expand RISSE services to other communities.

“I am a citizenship test tutor at RISSE. I help immigrants and refugees study for the US Naturalization test,” said Reynolds, who has been a volunteer at RISSE for a year and a half. “It has meant a lot to me to build close, meaningful relationships with the immigrants I have tutored. Their stories taught me about different cultures and perspectives and showed me the universal power of perseverance and determination.”

Reynolds’ essay was among thousands submitted in the 2019-20 InvestWrite competition.

“Financial responsibilities are a given in life, but financial education is not,” said Melanie Mortimer, President of the SIFMA Foundation. “That doesn’t add up for this country’s 57 million students like Maggie who are expected to compete in a global economy and manage their retirement. We must reduce barriers for teachers to bring financial education into the classroom and provide real-world educational experiences that prepare students for financial independence, economic mobility and the workforce.”

Reynolds was encouraged to enter the InvestWrite competition last fall by her economics teacher at the high school, Jason Majewski.

“This year, students were asked to reflect on a famous quote by Oprah Winfrey, who said ‘Whatever our dreams, ideas, projects, we plant a seed, nurture it and then reap the fruits of our labor,'” said Majewski. “The essay prompt is exactly what I hope for all my students. Every student has a dream and the potential to make a difference. It is my job to help them along the way with opportunities to build his or her human capital. Maggie Reynolds is an awesome student, who with this investment opportunity, showed what is possible with goals and hard work.”

With her new title as a nationally-recognized financial strategist, Reynolds was asked if she was being sought out to give others investment advice.

“My neighbor asked me how much I would charge for portfolio advice,” said Reynolds, who hopes to study political science, along with some economics and finance, when she heads to college next fall. “I told him he might get a reduced fee for being my neighbor. I will evaluate it case by case if my family members start asking me for advice!”

Congratulations, Maggie!

Winning NYS InvestWrite Essay by Maggie Reynolds

RISSE of Albany

RISSE- Refugee and Immigrant Support Services of Emmaus- is an organization in Albany, New York that assists immigrants and refugees in adapting to and building stable lives in the United States. RISSE offers after school programs for school aged kids and English classes for adults. The English classes are broken up into a Level 1 and Level 2 class in the old, run-down house RISSE rents. The building also houses administrative offices for the organization, so space for the after-school program and English classes is limited. My vision is a clean, spacious building for RISSE that matches the importance of the services it provides. A small house is not conducive to fully helping and offering services to the hundreds of immigrants that utilize the services RISSE has to offer.

To achieve this vision, I would like to spend $750,000. My investment plan is as follows. I would begin by investing half of the money in short term bonds with high interest rates (for example, through the Vanguard Short Term Treasury Index Fund.) Normally, the interest rates on long term bonds are higher.

However, currently, there is an inverted yield curve and thus interest rates on short term bonds are higher. This is because of anticipation of another economic recession in the next year or so; the economy has been on an upward trend (and is at a peak now) since the Great Recession, but that is predicted to come to an end. Once the stock market recession comes, I would increase the investment in stocks because I could buy many stocks at a low price and receive a high return.

Initially I would invest the other half of the money in an index fund. Over time I would increase the amount invested in the index fund. An index fund is where a company buys many stocks that represent the market as a whole and when the market goes up all the stocks go up at that same rate. I would invest in a mixture of the Russell 3000 Index Fund, S&P 500 Index Fund, or Wilshire 5000 Total Index Fund. This is the safest way to invest at any point, but especially during a stock market recession. I would be taking a risk if I were to guess which stocks would go up, but in buying an index fund I would be taking less of a risk. In the long run, I could count on the stock market going up after the recession.

Then, in one to three years, after the next recession has reduced real estate prices, I would buy the real estate: the new RISSE building. It would be safer to invest in real estate than investing all my money in the stock market. Additionally, RISSE would no longer have to pay rent on the original house that it is located in, as RISSE would own the new building and could stop paying rent on the old building.

I could focus money on improving the building and services RISSE offers instead of diverting resources to paying rent on a building RISSE would soon stop renting. The recession would make real estate prices go down, so I would buy the building when prices were low. This would give RISSE more money to invest in more teachers and programming for the improved school.

My 10-year goal for the project would be an annual 7% rate of return. The rule of 72 states that dividing 72 by the annual rate of return, a rough estimate of how long it will take for the initial investment to double can be calculated. This means that my investment will have doubled in roughly 10 years if I aim for a 7% annual rate of return. This is only a goal, and though I cannot guarantee it is feasible, I believe this is possible as it is a rate of return that has been achieved by the stock market over the long run. In 20 years, I would hope to expand my RISSE project into other cities in the capital region; potentially Troy, Schenectady, or Saratoga. I would look for sanctuary cities that welcome immigrants and could benefit from the infrastructure and services that RISSE could provide. I would also examine available property, property taxes, and real estate rates in each respective city at the time I am looking to expand.

About the SIFMA Foundation for Investor Education

The SIFMA Foundation is dedicated to fostering knowledge and understanding of the financial markets for individuals of all backgrounds, with a focus on youth.  Drawing on the involvement and expertise of educators and the financial industry, the SIFMA Foundation provides financial education programs and tools that strengthen economic opportunities across communities and increase individuals’ access to the benefits of the global marketplace. Notable Foundation programs include The Stock Market Game, which has enabled more than 18 million students to become financially prepared for life, the InvestWrite® national essay competition, the Capitol Hill Challenge, and Invest It Forward®. For more information on the work of the SIFMA Foundation, visit, visit www.sifma.org/foundation.