As I reflect on the whirlwind year that was 2019, I find myself overcome with emotions especially as I think about all that I have accomplished personally and professionally. In shining a light on my professional feats, leaving the university that I have called home for 17 years (first as an Upward Bound student, second as an undergraduate, third as a professional, and lastly a graduate student) to soar new heights at an new organization was dual parts exhilarating and frightening. Settling into my new role, I can confidently state that I have found an ease in knowing that my vast experiences and knowledge would be integral as I now work with a new caseload of New York City public high school students. These students’ post-secondary pathways are as unique as they are and as such, attention must be paid and care must be intentional. Moreover, as I work to discover just how unique their academic and personal needs are, I am also working to uncover what knowledge they already possess about the college application process, specifically as it relates to financial aid.
From introducing concepts such as award letters, FAFSA, subsidized and unsubsidized loans, Pell Grant, TAP, and taxes to dissecting what encompasses an institution’s sticker price, I find that the level of education varies and the gap is wide. Likewise, when introducing additional concepts that are often related to college such as a checking and savings account, credit cards, debt, interest rates, money as a medium of exchange or unit of account, I find that knowledge is minimal to non-existent. As a result, I am eager to delve deeper to uncover why such knowledge is low. In the interim, I believe I can point to one source of this illiteracy – a lack of early action education. In analyzing the many positive effects that early action financial education and planning has on a child’s personal development, I decided to participate in a #CreditChat hosted by Experian that centered on the various ways to introduce banking, debt, money, and saving to children of different ages. Here are my responses: Q1: How would you explain where money comes from to a child? WW: My first introduction to money was through a coin counting game. As such, when accompanying my parents to stores, I was given coins and had to use the dimes, nickels, pennies, and quarters to add up to the total amount. I will be playing a similar game with my child/ren. Q2: How would you explain to a child that credit cards are not free or infinite money? WW: Because most children are learning how to expand their vocabulary, using and explaining term such as borrowing, lending, monthly statements, etc. is a start. I would also show them my monthly statement as an example. Q3: How would you explain to a child what money is and what it does? WW: When teaching my introductory course, I always talk about the three functions of money and their purposes. For my child, I would use a dollar bill to simply break down each function. Q4: How would you answer a child who wants to know how much money you make? WW: When I first asked my mother how much money she made she grabbed her paystub and explained the “net” and “gross” amounts and what taxes were. I am certain that I will do the same, explaining each line items in an easy-to-understand tone. Q5: How would you answer your child when they asked, “Are we rich or poor?” WW: First, I’d ask what their understanding of “poor” or “rich” is. Next, I would use this question as an opportunity to talk about the differences between families and individuals with an abundance of access, money, and resources versus those who are not as fortunate. Q6: What’s your strategy for explaining why you can’t or don’t want to buy something for your child? WW: Being transparent without overloading them with advanced concepts and terms. As a result, I would be honest about not being able to afford an item/items of the moment because payment is needed elsewhere. Financial honesty is truly the best policy. Q7: What are some ways to explain the importance of savings to kids? WW: Tried-and-true methods of piggy banks and savings jars are an optimal start! To begin, have your child outline what their saving goal is and the timeframe in which they want to execute this goal. Then, have them start small by saving leftover change and bills. Q8: What are some ways to show kids how to spend within their means? WW: An early introduction to budgeting never hurts! Once they become aware of what their spending limit is that week, the next two weeks, or the entire month, they will (hopefully) begin becoming intentional about purchases and overall spending. Q9: How do you talk to kids about debt in ways they will understand? WW: Easing into the conversation is important. Show them your credit score and explain why the numbers are high or low. Show them your monthly credit card statement and explain why the amount is high, why the interest is high, and why it is taking longer to pay off. Q10: Any final tips on teaching kids about money? WW: As always, I highly encourage early action planning. Thus, whether your child’s introduction to money is through interactive games, hearty discussions, or tutorial through documents, their education starts now!
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WhitneyEducation enthusiast whose mission it is to see Financial Literacy receive well-deserved shine. Archives
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