| Ten Ways to Teach Kids About Money | |
FOR IMMEDIATE RELEASE | Contact: | Nicole Anderson Vice President of Marketing
USA Federal Credit Union
nanderson@usafed.org
(800) 220-1872 |
San Diego, Calif., July 13, 2006 – Every parent is worried about their kids getting the basics: reading, writing, and arithmetic, but a new literacy need is becoming more important in America: FINANCIAL LITERACY. “Last year, because of financial mismanagement, more young adults filed for bankruptcy than graduated from college in 2001-2002,” said Nicole Anderson, VP of Marketing at USA Federal Credit Union. “To be in control of your life means being in control of your money, and young people need help more than ever.”
The statistics are not encouraging. Among teenagers: | • | 22% don’t understand that if you take out a loan, you have to pay it back with interest | | • | 33% believe Social Security is all the money they will need when they retire | | • | 25% believe financial aid will pay for all college expenses | | • | 33% of high school seniors already have and use credit cards |
“The situation is just as dangerous among young adults,” Anderson said, “The average college graduate leaves school with $30,000 in debt before getting that first career job.” Here are some more important facts: | • | Only 65% have a savings account | | • | 70% of college students have at least one credit card and about 20% of them owe more than $10,000 | | • | Full-time college students, who are now graduating with more loan & credit card debt than ever before, are also responsible for $19 billion in annual discretionary spending including $40 billion in loans | | • | 42% of those with student loans say working during college affected their grades | | • | 43% of graduates with college debt used a credit card to pay tuition | | • | 37% of those polled say education-related debt contributed to depression |
“We need to emphasize teaching kids about money much earlier,” Anderson noted. “It’s never too early and never too late! Parents need to help children and teens in four specific areas: learning how to spend, how to save, how to manage their money over the long term, and how to borrow responsibly.” USA Federal has developed convenient Top 10 Tips and more resources for parents who want their kids to be money smart. Top 10 ways to teach your children about money | 1. | Use fun tools to get them involved: Piggy banks and coin counters are visual and fun. | | 2. | Find ways for kids to save for, then buy, something they really want. This teaches there is a reward for the discipline of saving. | | 3. | Try using three containers labeled: “SAVE”, “SPEND”, SHARE.” Show children how to set aside money for each purpose from the money they receive. This helps them to understand the purpose for saving, the goal of spending, and the need to share your resources with others. | | 4. | Let kids watch you work through the household budget. Show them how money is spent for the family, how it is not unlimited, and how bills get paid. Ask them if they want to develop their own personal budgets too. | | 5. | Take kids shopping, show them the costs, and ask them how they would get the most for their money on things like school clothes. | | 6. | Find odd jobs, above and beyond the normal chores, for which kids can earn extra money. This shows them how extra effort pays off and how they can earn more in the future. | | 7. | As they get older, show them how savings and checking statements work. Explain how to watch balances, appreciate growing assets, and to avoid impulse spending. | | 8. | Teach teenagers how to avoid credit card abuse. Explain how rates and fees can get very expensive if ignored. Explain what should be put on a credit card and what should not be charged. | | 9. | Teach teenagers about saving for large ticket items instead of just charging for them. Cell phones, DVDs, and even cars can be very tempting to teenagers. Financial discipline becomes very real at this age! | | 10. | Teach teenagers about starting early with retirement planning. Help them gather information about mutual funds, stocks, bonds, IRAs, 401Ks and other vehicles. |
Want Additional Resources? | • | Visit one of several USA Federal Credit Union branches to request a workbook kit (Grade K-3 or Grade 4-7), bookmark and piggy bank to help young ones get started. | | • | A free student guide is available from the National Endowment for Financial Education’s “NEFE High School Financial Planning Program “
http://www.nefe.org/pages/highschool.html | | • | Credit Union National Association (CUNA) www.cuna.org/initiatives/youth/hsfpp.html | | • | CUNA’s “Thrive by 5” program designed to teach preschooler’s about spending and saving. Free activities and resources are available online. www.creditunion.coop/pre_k/index.html | | • | “Raising Money Savvy Kids” article provided by Credit Union Alliance of San Diego
www.creditunionalliance.org |
About USA Federal With more than 61,000 members and $699.4 million in assets, USA Federal Credit Union (headquartered in San Diego) operates 20 branches, including locations in San Diego and Riverside Counties, Las Vegas (NV), Japan and Korea. Members of this non-profit financial cooperative include the military, civilians and select employee groups. Founded in 1953 at the Naval Training Center in San Diego, USA Federal offers a full range of financial services including business services and consumer savings, checking, mortgage and home equity loans, auto loans, debit and credit cards, share term certificates, IRAs, and a 24-hour phone center. Online services include eStatements, Online Banking and Bill Pay with Money HQ and online loan applications and approval. Additional services include the BALANCE financial fitness program, and investment and retirement planning offered by MEMBERS Financial Services. This credit union is federally insured by the National Credit Union Administration. Visit www.usafedcu.org or call (800) 220-1USA (1872) or (858) 831-8100 for more information. ### *This link contains a PDF file that requires Adobe Reader. Download Adobe Reader for free here. USA Federal provides links to third-party web sites as a member courtesy and does not guarantee the accuracy of any information obtained from this third-party as detailed in our Terms of Use. Note: USA Federal maintains the above information for archival purposes, which is presumed accurate upon release, however, data may become outdated over time and affect accuracy. |
