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Money Concepts Your Student Should Know Before High School

Did you know: According to the Council for Economic Education, only 17 states require students to take a personal finance course in high school. That means when it comes to learning how to budget, write a check, balance a checkbook, and pick a credit card, most young adults have had no education or experience on these matters...

Skeptical of the impact a high school course could make on your teen? A Federal Reserve report revealed that students who were exposed to a course in personal finance had an average credit score of 7 to 29 points higher than those who never took such a class.

A JA and Allstate survey found that 84% of teens look to their parents to learn about money management. So, while the chances are that your state curriculum doesn’t require students to learn about personal finances, you can prepare your child in the one environment they spend the most time – at home.  

These are our top 5 personal finance concepts that your high school student should know and how you can teach them!

1.      Budgeting

Sounds like a no-brainer, right? But would your teen know the difference between income, expenses, and savings? Would they know that their expenses should not surpass their income? Teach your teen this concept by identifying the regular monthly expenses such as gas, phone bill, food, etc. as well as putting some money aside for unexpected expenses. Need a template? Print off our FREE budgeting worksheet

2.      Credit Cards

Most teens have heard the horror stories of credit cards, but do they actually know how credit works? While your teen needs to be 18 to be a credit card holder, it’s never too early to teach them how they work, what interest rates are, payment periods, and credit scores. With your teen, check out NerdWallet where both of you can search and compare various credit cards and their features!

3.      Bank Accounts and Savings

If your teen doesn’t already have a bank account, we suggest you establish one ASAP. Teach your teen about ATM fees, fees associated with individual bank accounts, online banking and how a debit card works. The best way? Hands-on learning. Once they receive their debit card and show them how to keep track of their transactions. Have your teen inquire about what perks their bank may have for a personal savings account and help him or her outline some of their goals like buying a car, affording college, or even purchasing their first home down the road!

4.     Loans

Student loans can help make college dreams come true, but can also become a nightmare down the road if not used responsibly. Be sure that you discuss the difference between federal and private loans, calculate the monthly payment for each loan (including the interest rate), as well as how it can impact their future savings. Need a personal narrative to share? Check out The Empowered Dollar

5.     Impulse Spending

When it comes to wants and needs, most teens don’t have the self-control to evaluate what is more important objectively. When your teen has their bank account set up, take the first couple months slow. Print out the transactions and go through the expenses with them. Go down one-by-one to determine if the purchase was a want or if it was a need. By doing this, you can help your teen see the bigger picture of money.

While most states do not require personal finance education, JA offers programs in all 50 states throughout the USA and that promote financial literacy, work readiness, and entrepreneurship in curriculum aligned to state standards! JA programs teach important life-long skills while advancing educational goals.

Countdown to Resolutions for Teens

How old were you when you made your first New Year’s Resolution? Do you remember what it was?

With 2019 nearly upon us, JA wanted to know if teens are making their resolutions for this upcoming year, and if so, what they were. According to a survey of 1,000 U.S. teens, conducted by Junior Achievement USA and ORC International, nearly 9 in 10 teens (88%) are planning on making New Year’s Resolutions. The resolutions they are looking to achieve:

Achieving Successful Resolutions

How do those who make resolutions, keep them?

While some have believed that a habit can stick after just 21 days, science has found this to be false! According to research conducted by the University College London, it takes an average of 66 days to create a habit.

To keep resolutions sustainable, here are our top tips for the teens that share our resolution findings:

1. Pick 1 – 2 resolutions!

Too many resolutions and you’ll be overwhelmed; yet too few and you won’t be challenging yourself. Stick with a range of 1 to 2 depending on how committed you are to the change you want for 2019!

2. Tell others about your resolution!

By sharing your resolutions with those who you are closest to will not only build a support system, but will also make you more accountable!

3. Write it down!

Everyone needs a reminder. Writing down your resolutions will give you a goal that you can’t change should the resolution get difficult. Be sure to keep the piece of paper you wrote down your resolution in a location that you will visit daily.

4. Pat yourself on the back!

It’s tough to maintain change, especially for 365 days! Break down your resolution goal into 3 “mini-goals”. The first goal should be focusing on getting you off to a good start, the second should challenge you a little further than the first, and the last mini-goal should be where you achieve your resolution. After accomplishing each goal, be sure to treat yourself! Incentives are always crucial for keeping motivation up and doubt down!

 

May your holiday season be filled with joy and may your resolutions be full of success! 

 

Taking the Stress out of Holiday Spending

The holidays are upon us! This means you’ll be spending more time with the ones you love AND more money. From Black Friday to holiday December sales, buying during the season of giving has never been easier or more appealing. Once January comes around your generous giving may turn into gifting regret.

To keep your bank account happy during the season of holiday shopping, here are our top tips and tricks!

1.     Plan ahead

-       The holiday season has always been a time for joy, family, great food and, of course, anxiety. Like many Americans, you may find yourself struggling to find the perfect gift for the most important people in your life. During the year, you may come up with a great idea that you can wrap up and use in December, but by the time holiday sales are starting, you may not remember what genius gift idea you had! A trick to combat this brain baffle is to create a list (in a notebook or even on your phone) or, create a secret Pinterest board. By identifying gift ideas early, you can keep an eye on prices to get the best deal.

2.     Structured Spending

-       As the pressure for generosity becomes a detrimental evil on your bank account, it’s essential to determine your income, expenses, and your financial goals. Don’t feel obligated to spend more than you should just because it’s the giving season. If you haven’t, create a monthly budget for November and December. Determine what expenses you will have coming up and look at the income you will have left over after you’ve paid your bills. Then, for the most important part, actually stick to the spending limits that you give yourself. You’ll thank yourself in the New Year.

3.     Don’t Settle

-       Put away the scissors and the Sunday coupons, there’s a new app called Honey which automatically finds and applies coupon codes while you shop online. While this won’t replace other online retailers that can beat one site’s pricing, it can help to save a few dollars for the next item on your gift list.

Prepare the Bank: College is Coming

Did you know: In 2016, students who were starting their first four years of college paid 28% MORE for college than the undergrads a decade ago did and 65% more than students did 20 years ago? Student loans account for the second highest consumer debt category, which is why it’s crucial for high school grads to consider how a student loan will impact them after graduating college.

In 2016, the average student loan was $37,172, the following year the average student loan debt for those graduating in 2017 was $39,400. A Junior Achievement (JA) survey revealed over half of high school juniors (52%) admitted they didn’t know the cost of college tuition and only 59% of high school seniors had $5,000 saved for college.

Before going in to a financial panic, here are some resources to prepare yourself or your teen for life after college:

Cost Breakdown

Wouldn’t it be great to know the breakdown costs of achieving your goals and dreams?

Now you can with JA Build Your Future! Not only is this app FREE, but it also provides teens with a roadmap from choosing a career to calculating the cost of reaching career milestones. 

Career Discovery

Not every 18-year-old high school grad knows what career path to go down, which is why JA My Way is a great tool! From a personality quiz to job matches, teens explore what they can do now to prepare for tomorrow!

Nurturing STEM Interests

Interested in a career that involves science, technology, engineering or math? You’ll want to check out JA Assembling Your Career.

Once there is a game plan for what career interests you or your teen, it’s necessary to start your financial planning. Here are some ways you can get financial assistance without taking out a student loan:

Fill Out Your FAFSA

Most of us have heard of FAFSA (Free Application for Federal Student Aid), but what is it? FAFSA is an annual form that is submitted by a current or prospective college student residing in the USA for financial aid for federal grants, work-study, and loans. Various factors determine whether a student is eligible to receive financial assistance, including adjusted gross income, IRA deductions and payments, and many more. Click here for a list of what’s considered by FAFSA. As some states and universities distribute financial aid on a “first-come, first-serve basis,” it’s essential to get your forms turned in ASAP. Check out FAFSA FAQ here!

       Start Saving

The more you save, the less you will have to worry about down the road. All you need to do is start a savings account for your anticipated college expenses. Every little bit you can put away into this account will help.

Look for Scholarships

Scholarships are a great way to help fund your college education. Depending on the scholarship specifics, candidates may be chosen based on elements like GPA or a specific interest. To explore scholarship options, click here!

 

Building Financial Wellness in Teens

You work out for your physical wellness, you eat right to maintain internal wellness but what are you doing to improve your financial welfare? By definition, financial wellness is the ability and understanding of successfully managing financial expenses. This concept revolves around the sense of feeling financially secure and free in the present day and future. Those who have achieved financial wellness are typically healthier, more focused and are even more productive in their everyday work.

A Stress in America poll conducted by the American Psychological Association found more than 6-in-10 (62%) Americans felt money is a significant source of stress in their lives. Yet, when we think about the moment financial stress typically began, you may remember back to when sticking to your financial goals you bought your first car or when you were determining how to pay for college or trade school. Whatever your initial topic of money concern was, it was probably in your high school years.

During the summer of 2018, Cengage conducted a survey examining the impact of “financial sickness” in college students. Their research found 85 percent of current or former students felt high financial stress when it came to affording required class materials, compared to the 88 percent of students who were stressed to pay for tuition. With the majority of Americans and college students feeling a sense of financial illness, what are possible prescriptions?

Creating a strong financial foundation

A quick course in financial education is not enough to change an individual’s money management. The core of financial wellness is a sense of “well-being,” feeling that you have a strong enough financial foundation to execute the actual financial behaviors that necessary to reduce primary money stressors.

Financial Goals

In 2018’s Teens & Retirement survey, Junior Achievement (JA) revealed more than two-thirds (69%) of teens know little or nothing about financial planning. In fact, 30 percent of those ages 13 – 18 reported that they felt $5,000 or less was enough to retire on. These findings highlight the importance of establishing short-term and long-term goals at a young age to jump-start financial thinking. As financial wellness not only looks at today but what lies ahead, it’s crucial for youth to work towards a goal. Goals create accountability, as well as a reason to continue persevering through challenges that one might face in the future they also reinforce an individual’s budgeting plan.

Financial Attitudes

In the same 2018 JA survey, almost half (46%) of teens reported that they are not confident in their ability to plan for retirement. Financial attitude translates to how one feels about money that impacts their spending. The way an individual understands what is a need or a want directly impacts their behavior, for example. To beat the bad financial bug, take time to look over your monthly finances, determine if what you are spending money on is beneficial or a deterrent from your goals. The sooner you can identify unnecessary spending, the faster you can reach your future money-milestones.

Tools & Resources for Financial Wellness

Help your teen start planning for life after high school graduation with JA Build Your Future®!

Not sure what career to pursue after high school? Find out with JA My Way

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