Money Talks

by Dani Hamblett

This past spring, in a freshman-level public speaking course right here in Texarkana, one of my students got up to pitch her persuasive speech topic to the class.

The exercise goes like this: the student stells us what they are going to attempt to persuade, and the class acts as jury to either say “yea, great idea” or “meh, try again, we already know not to text and drive.” They then go on to do research and give the peer-approved speech, and hopefully the students get something out of it and it isn’t just white noise. When this particular student got up in front and said, “I’m going to persuade ya’ll, and explain how to, make a budget,” I waited for the groans and paper balls to be thrown. I mean, bo-ring, right? I was surprised to see heads nodding and enthusiastic sounds coming from the class. “Really, you guys never learned to make a budget?” I asked. All 15 heads were shaking back at me…nope.

We are not alone. According to the most recent study by the JumpStart Coalition, which has been collecting data on the financial literacy of young adults in the U.S. since 1997, in 2008 only 4.7% of high school seniors who were tested on personal finance topics received a grade of C or better (the average score was 48.3% – a F).

Thus far this type of education has fallen in the realm of parental responsibility (and rightly so, in this writer’s mind). But research shows that parents are not stepping up, and kids are graduating and heading off to college, or into the workforce, without having the skills to manage money packed away in their suitcases.

Enter the government. In June 2013, our state legislature passed House Bill 5, which will require high schools to have financial literacy curriculum and for the subject to be included on standardized tests. While 24 states total require these types of financial ed classes be offered, Texas joins 15 other states who take it a step further and require testing.

Curriculum for Kindergarteners on up will also be tweaked to incorporate some finance into their math lessons. Red River Federal Credit Union has already been offering financial literacy programs to Kindergarten, first and second graders in several local schools, and hopes to reach out to more schools and organizations this school year.

One of the things I’m constantly reminding myself as a parent is how life skills are learned; kids will not just learn how to clean properly or sort laundry or write a check or make spaghetti sauce on their own, you have to show them how. And then let them practice it while you are there to guide and help. Managing money, making a budget, applying for credit, what interest rates even are… these things are no different, and we can’t afford to let them fall by the wayside.

Don’t wait until your kids are seniors to bombard them with financial information. Here are a few ways to get kids thinking financially earlier:

Discuss the idea of things you want versus things you need. Help kids understand that needs like housing, utilities, automotive costs, and groceries come before things like dinners out and vacations.

Already paying allowance? Talk to kids about budgeting into different categories: maybe $2 goes to candy or a treat, $1 into a fund to save for a toy, and $2 into long-term savings for a bigger goal.

Let kids be a part of decisions at the grocery store and understand store brands versus name brands, looking at pricing per ounce, etc.

If your kids have a money making venture, like a lemonade stand, help them understand gross vs. net profit by explaining to them the cost deduction of the supplies.