Junior Achievement Answers Your Questions

Earlier this month, Junior Achievement offered to do a question and answer with all of you. You gave them some great questions about kids and money. Here are their answers:

Mike D. asked:

“Are teens today more aware of the economy, and more aware of how important saving vs. spending is, compared to 10, 20, etc. years ago. Is this trending in any way (more aware, less aware).”

Our nation’s current economic crisis clearly demonstrates the need for financial literacy for our children, hopefully through our schools. Junior Achievement is so committed to ensuring that the next generation grows up with a fundamental foundation of financial literacy that we have created free, downloadable classes aimed at children in grades 5-12 and created lessons for parents and kids to do together. These resources are available at www.ja.org.

Here is the second part to Mike’s question:

“What do they think this recession will mean for that generation. Will it be more like the generation that came out of the great depression where they are less wastefull and got everything they could out of an item before getting rid of it, saving more, and using less debt? Or will this generation continue a lifestyle similar to what is in the economy now where people consider credit cards a way of life?”

It is difficult to know the ultimate outcome that our current economic crisis will have on the younger generation. The survey that we recently conducted in partnership with The Allstate Foundation shows that teenagers are feeling anxious about the economy and the poor economic situation is having an impact on their daily lives. For example, nearly half (49 percent) said their parents had discussed family finances with them as a result of the economy and 12 percent are contributing financially to the family budget.

SmileyGirl asked:

“As teens growing up in today’s economy do you feel it benefits your personal growth to have to pay for part of your expenses (car insurance, gas, spending money, etc.) or should we as parents reward you more for saving your money. As a parent of a teen and two pre-teens, I struggle with the right balance of teaching my daughters to be responsible with their money by saving and at the same time showing them that life costs money and it is a priviledge to do things like drive, eat out, etc. I want them to realize that life is not a walk in the park where you can spend carelessly with no consequences but at the same time I don’t want them to feel so strapped financially that their years of youth are spent agonizing over money. Any advice?”

The way you choose to teach your children about money is very personal and often different for each family. What may work for one of your kids may not be as effective for the other. The most important thing you can give them at this age is a solid education and set an example through your own behavior (that is visible to your kids) in the basics of personal finance so that they can make responsible decisions as adults. If you yourself only talk the talk but don’t walk the “financial walk” it can be difficult for children to take your money management lessons seriously. If they’re not getting the financial education they need at school, take matters into your own hands. There are resources on ja.org that can help parents teach their children about money management.

Ken asked:

“What 2 or 3 basic things can I do to begin to teach my 2nd grader about money?”

Budgeting and money management can be abstract concepts for a 2nd grader. By this age, they are often very capable of identifying things that they want. Once they’ve identified a goal, be it a new toy, snack or a movie, work with them on a way that they can earn that item. Whether they have chores around the house, have extra good behavior or forgo other items they may want, help them understand the actual worth of the item they want.

Begin to exercise comparison shopping with your child as well. Next time at the market, give them a few items they’re in charge of buying, such as breakfast cereal, pasta sauce and juice with a set budget. See if they come within that budget, and then you can discuss comparing prices and when to splurge on a brand name and when a store brand can be just fine.

I also asked a few questions:

“The facts shared about teens and money concern me. Especially how some are stressed due to the economy. I can only imagine that stress can spread through an entire family(young children included) during rough financial times. How do you recommend dealing with rough times with children? They will notice that things are different than they once were.”

It’s important to begin teaching children financial literacy from an early age, as you’re never too young to begin learning how to manage your money effectively. That lesson is very different for a five year old versus a teenager versus an adult, but the vital action is opening that dialogue so that money doesn’t become a scary, taboo topic in your household.

“Do you have any suggestions for free learning material to print/download for children?”

Junior Achievement recently created new series of free, downloadable teaching tools to help parents talk to their children about smart money management called Junior Achievement $ave, USA. These lessons are divided out by age group and discuss topics such as budgeting, the importance of saving, understanding the cost of credit and how to use it, and planning how to pay for college. The lessons are sponsored by The Allstate Foundation and are crucial for children’s financial literacy education.

“If one was interested in volunteering with Junior Achievement and working in their local school, but there were no Junior Achievement offices nearby, what could they do?”

While a Junior Achievement office may not be located in your city, there are offices all over the country. By contacting the office nearest you, there should be local opportunities for you to participate in so that you can help make a difference in local children’s lives. To find the closest office near you, visit ja.org and click on the “JA Near You” button to find local volunteer opportunities.

I’d like to thank Junior Achievement for answering our questions!

Posted by Tricia on April 25, 2009 at 9:02 AM in Kids & Money | 1 Comment »
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Ollie responded:
Posted: June 10th, 2009 at 5:09 pm
Its awful when you’re in that hole with depression, but I believe you can climb out of it, its a long journey but boy is it worth it, as the suffering and the experience in the long term becomes an asset. Would you agree?