Modern financial literacy education teaches children to save for a rainy day — and for college, homes and more
In many a school, back in the dark ages before there was a debit card in every wallet and a banking app on every phone, the extent of financial literacy learning was, “Here’s a checkbook. Here’s the column for deposits and the rows for checks. Try not to hold up the line in the grocery store.”
It was perhaps not, in retrospect, the most savvy approach to a lifetime of money management. Katie Decker, principal of Walter Bracken STEAM Academy, Walter Long Elementary and Howard Hollingsworth Elementary, knows that even the simplest of financial education can help lay the groundwork for a lifetime of good judgment when it comes to money. She also isn’t particularly shy about what she thinks of the current system’s approach to financial literacy.
“Common sense doesn’t prevail in education,” she says. “To me, (financial literacy) is non-negotiable. It’s part of what we have to teach. It’s one of the things that left the curriculum. I don’t know why it’s not required.” Decker is at the forefront of an aggressive push to help Clark County kids get their nickels and dimes locked up in a piggy bank.
Or, the Piggy Bank, as the case may be. One that doesn’t take a hammer to free up your rainy day fund. In 2013, the United Way’s newly formed Young Philanthropists Society was looking for a project to make a mark. The permanence of establishing an actual, functioning bank in a school to teach financial literacy appealed to the group, but they weren’t sure how to proceed. Decker convinced the society to launch its Piggy Bank program at Bracken.
Silver State Credit Union is the actual financial institution of record. Everything about the Piggy Bank functions as a real bank. Kids are encouraged to make weekly deposits at an actual, physical walk-up counter (the kind your actual bank has been trying to do away with for years). At Bracken, it was set up in the former school store.
The fourth leg of this project was Andson, an educational nonprofit that focuses on boosting academic improvement and financial literacy for kids. Andson came in and helped design and teach the curriculum in class, in order to turn children into the kind of finance-savvy people that wouldn’t, say, take all the money they earned over multiple summers working at a high school job and blow it on a really cool guitar. (Just speaking, you know, hypothetically.) The program accommodates first- through fifth-graders. At the end of fifth grade, kids can either continue on with an account at the credit union, or they can collect a check to take to another financial institution.
The society gave kids quarters to get them started. Decker encouraged them to save their own change, too. From that modest start, big things began to happen.
Small change, big changes
Two years ago, Bracken students collectively saved $30,000. This year they got it up to $50,000. The program first expanded to Hollingsworth, which socked away $9,000. This year, Walter V. Long Elementary got in on the fun and put away $14,000. Hollingsworth was Decker’s first school as franchise principal, and she recently took Long under her wing. She expects those numbers to go up at all of her schools.
Part of the way the school encourages saving is to strip it all down to its simplest components, teaching the difference between wants and needs. Decker knew she had a hit on her hands when one fifth-grader told her that before the program, he thought candy was a need. Now he knows it’s a want. (This is arguable.)
“If we can focus children on saving and delayed gratification and wants and needs — ‘Should I eat popsicles every day, or if I save the money on the popsicles, what might I have by the end of the year? Maybe I can afford a book at college?’ Let’s get the concept out there (of) having a savings account and having a reserve in the event you have any emergency come up,” Decker says.
There are kids saving for college, and some saving for houses. Imagine buying property in your early 20s because you had the wherewithal to marshal couch-and-dryer change for it in your Inside Out years. But the program doesn’t stop with the kids. Parents are learning about saving, too.
Some parents have zero experience with banks. There are educators who stress the importance of the program during parent-teacher conferences. The idea is if they can get the folks on board, they’ll reinforce these lessons at home. So parents are taught things like how to fill out a deposit slip. They see that kids can use an app to check their balance and see how an account is growing. They get, well, invested.
“My neighborhoods, they don’t bank,” Decker says. “A lot of them are from Mexico. It’s that trust. They learn to trust us. That’s why they’re participating so much. They get that we’re trying to help them.”
The Piggy Bank may be one of the most successful recent programs in the local financial literacy landscape, but it’s by no means the first.
Junior Achievement of Southern Nevada runs economic success programs in nearly 40 schools with 15,000-20,000 students led by an army of more than 800 volunteers annually. Junior Achievement’s kindergarten-through-12th-grade curriculum starts with its “JA for a Day” courses, in which volunteers teach financial lit lessons tailored to specific grade levels. For instance, fifth-graders learn about entrepreneurship, the types of jobs out there, the skills necessary to get them and how all that fits into the global economy. (In case you were wondering who might take your job out from under you as you slowly descend into obsolescence, this is the answer.) The organization operates primarily Downtown, and 85 percent of its students are from low-income schools. That focus allows them to establish a feeder system from elementary to middle school to high school where kids are ideally coming into contact with Junior Achievement every year.
Jodi Manzella is the chief operating officer of Junior Achievement of Southern Nevada. She started as a volunteer 19 years ago, when she went into a Las Vegas High School classroom to help kids start their own business. She spent 20 weeks taking them through business plans and market research and promotions to sell T-shirts. One girl, who resisted at first, eventually came around and designed the shirts. She ended up going to school for design. Manzella was hooked. Two years later she went to work for Junior Achievement.
“Either we educate these kids now so they understand the subject matter and how it affects them in the future and they can be successful, or we’ll all be paying for them,” she says. “They’re going to drop out and maybe take government assistance. That affects our tax dollars. It’s truly important to teach students these concepts now and be that prevention.”
The fifth-graders cap off their program with a trip to BizTown, where kids can help design and manage a simulated city. All three of Decker’s elementary schools will make the trek to BizTown in San Diego next year. In eighth grade, it gets more intense as middle-schoolers have the opportunity to visit Junior Achievement’s Finance Park from October to December, held this year at the old Lied Discovery Museum site on Las Vegas Boulevard.
Almost 3,500 students took part in Finance Park this past fall. Over the course of 4 hours, kids become an adult for a day. They get a life scenario where they’re told how old they are, what their job is, how much they make, if they’re married or have kids, what their credit score is, how much debt they’re carrying and what their education level is. With all of that information, students have to make 25 budgeting decisions and come up with a one-month balanced budget. It’s grown-up fantasy camp for all of the lousy parts of being a grown-up and none of the fun stuff, like buying your own beer or planning a staycation. The idea is to gets kids thinking about money management, investing, saving and credit, but there’s also a subtly reinforced message about the importance of education.
“The goal for the students is not only to understand the important personal financial concepts, but for them to understand that everybody in the room has a different life scenario,” Manzella says. “Everybody’s educational level is different. They’re sitting at a table of five peers. Someone at the table might have only a high school diploma, some might have a Ph.D. They see that earning potential is a lot different and you can get a lot more stuff if you get a Ph.D. than if you only have a high school education. We want them to understand their ticket to their future is their education.”
Money on their mind
The Uplift Foundation, a nonprofit that offers various youth programs on top of financial literacy, offers a similar adult-for-a-day outing in the Mad City Money simulation, in conjunction with the SCE Federal Credit Union. Upon completion, kids get a $25 voucher to open an account with the financial institution. Uplift also holds an annual economic summit, primarily for high schoolers, that covers everything from money management to credit to scholarships.
That confluence of college and credit cards is a universal talking point to these programs. Manzella warns kids not to do what she did, and sign up for a credit card on the flimsy promise of a free T-shirt. No one should be paying off Taco Bell-and-sneaker debt into their 30s, but that’s the kind of pitfall that financial literacy educators are trying to stave off.
Justin Micatrotto, the co-chair of the Young Philanthropists Society who helped get the Piggy Bank program off the ground, was lucky to have some guidance from his father, because his financial education in high school was virtually nonexistent. Andson’s co-founder, Sonia Anderson, was born in poverty in Guyana and the only way she escaped was by educators helping to give her a leg up. She had to teach her mother how to count, and took over the family finances as a child. After coming to America, she eventually built a debt management business that she sold in 2008. She got into the nonprofit arena because she wanted to do something to help break people’s cycle of debt.
There’s a common thread to these programs, of adults trying to fill in kids on the life skills they themselves never got in school.
“Financial literacy, for me, is one of the most critical things we have to teach our youth,” Decker says. “Living in Las Vegas, a city where people are foreclosing on their houses left and right, seeing parents make financial decisions that are not in the best interests of children, the debts they’re accruing, it’s a huge issue. When you work with elementary-age children, that’s the time to inspire. That’s the time to change that story for them as adults. Saving is a habit. It’s something you have to practice. Anything we get the kids to develop as a habit while they’re in elementary school, we hope that will carry through with them the rest of their lives.”
It’s enough to make you want to unload the guitar and open a money-market account.