Promoting financial literacy in teens

(FOX Providence) - It’s been called “The Recession Generation”, the teenagers who have grown up in the economic recession triggered by the 2008 collapse of the housing bubble. 

A survey of how teens feel about money and their future was conducted earlier this year and its findings highlight the need to not only promote financial literacy, but help students understand the realities of the current job market.

Peter Kerwin, from the Rhode Island Higher Education Assistance Authority, joined The Rhode Show to talk more about it.

Is there a gap between what students are expecting and what the job market is offering?

There is. The 2011 Teens and Money Survey conducted by Charles Schwab & Company earlier this year gave us a bit of a good news/bad news finding. A full 81% of teens aged 16-18 plan to choose a career because they feel passionate about the work or it will make a positive contribution to society. That’s very positive, but the problem is they expect to begin their careers earning as much as $73,000 a year. The median household income is less than $50,000, so most of them aren’t going to be beating that right out of the box.

One thing we do at RIHEAA, through our WaytogoRI.org web portal is offer a range of career information. You can look learn about specific jobs, the education you are going to need and what you can expect in terms of a starting salary. You can find median salaries by region within a particular field and all sorts of labor market information.

The survey also highlighted several topics where 18 year olds today were less knowledgeable than they were in 2007—how credit card interest and fees work, how to manage a credit card, and how to balance a checkbook or check the accuracy of a bank statement. That’s a reminder of the need to really promote financial literacy. Now this survey found that as a result of the recession, there are many more conversations taking place in households where parents are trying to talk to their children about money issues and what’s going on in their family.

What’s being done to promote financial literacy in Rhode Island?

Fortunately, we have a great organization, the Rhode Island Jump$tart Coalition, which is working with educators and striving to bring attention to the importance of improved financial literacy training. They are holding a conference on December 16th at the convention center—a day of professional development for high school teachers, guidance counselors, social service professionals and human resource managers.

CollegeBound Fund is proud to be a sponsor of this event and to support this important effort to explore the link between personal finance and the job market. There will be some terrific speakers and panel discussions for people who are helping teenagers manage their finances and who want to make sure young people understand the realities of the job market and how it relates to their college decisions.