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The Costly Mistakes that are Plaguing Teens

College acceptance season is one of the most exciting times in a teen’s life. Students will rip open university marked letters searching for the one word that will change their future – congratulations. With that one word, teens will become overwhelmed with the excitement of their new-found independence and freedom.

Teens Preparedness for college Expenses

Yet, what most students don’t think of when they come across “congratulations” is understanding the best way to manage college expenses. In a recent survey conducted on behalf of Junior Achievement USA and Citizens Bank | Citizens One, large portions of high school juniors (52%), high school seniors (39%) and even college freshman (34%) reported being unprepared for the cost of college.

 

In fact, most of the teens surveyed stated that they had not done enough research on how to pay for college, and many had not talked with their parents about their financial options. 

College Savings Results

 

"It's no wonder that kids feel vulnerable," said Jack Kosakowski, President, and CEO of Junior Achievement USA. "As a community, we are not doing enough to educate young people to make smart, sound decisions so they are confident and secure in the choices they make that impact their lives so dramatically."

 

 

 

Bringing Awareness to College Costs

When high school juniors and seniors were asked about the costs of college, the majority responded with “I don’t know.” Other teens admitted that they had not done enough research on HOW they can pay for college. In fact, only 8 percent of college freshmen surveyed provided an accurate answer when asked how much in-state tuition for a public four-year college cost.

With the staggering perception of college costs, most can agree that students need to seek more information to the costs associated with higher education.

While some teens may seek information from their parents, they also look to their high school staff, college websites, friends, college fairs, social media and financial websites or financial organizations to discover the costs of college, according to the survey.

Brendan Coughlin, president of consumer deposits and lending at Citizens Bank stated, "It's clear that more needs to be done to help equip students with the tools necessary to minimize student debt and help students make more informed decisions on what loan is best for them," said Coughlin. "We're helping our young people understand how to make smart financial decisions so they can pursue their studies and begin their careers after college on sound financial footing."

As most can agree that college is an exciting time in a teen’s life, it should also be a time when they begin to understand how to budget and save and how they can afford their college endeavor.

To uncover more findings from this Junior Achievement and Citizens Bank | Citizens One survey, and to find resources to help your teen plan for his or her future, click here.  

Sprout JA Learning Early: Books for Kindergarteners

According to the National Education Association, children who are read to frequently are more likely to count to 20 or higher when starting school compared to those who were not read to. Engage with your child by checking out the following books that focus on concepts of careers and money all while helping them develop basic learning skills.  

Books for Kindergarteners

Careers / Entrepreneurs

Camila’s Lemonade Stand (4.7 / 5)

“Camila is a plucky kid in the Career Launcher Crew, seven fearless children in search of their futures. When she finds herself with no money for the Ferris wheel, friendly sprite Itsy shows up to give her some good advice: she can start a business! What happens when Jaden opens a competing cookie stall? And will the dark clouds on the horizon rain out their fun?... Camila’s Lemonade Stand is a wonderful first introduction to entrepreneurship. Grounded in the key principles underpinning every successful venture.”

Cleonardo, the Little Inventor (4.7 / 5)

“Cleonardo's father is an inventor. So was her grandfather, her great-grandfather, and all the great-greats before them. Cleo wants to be an inventor too. She tries to help her father in his workshop, but he never uses her great ideas. Can Cleo invent something big and important and perfect all by herself?
This imaginative story of a father and his daughter brings the magic of creativity to little inventors everywhere.”

How this Book was Made (4 / 5)

“You may think you know how this book was made, but you don't. Sure, the author wrote many drafts, and the illustrator took a long time creating the art, but then what? How'd it get into your hands? Well, open the cover and read through these pages to find out. Just beware of the pirates and angry tiger. New York Times best-selling creators Mac Barnett and Adam Rex reveal the nitty gritty process of making a book . . . with a few unexpected twists along the way! Budding writers and artists will laugh at the mix of reality and the absurd as the story makes its way to a shelf, and a reader.”

Money

            The Coin Counting Book (4 / 5)

The Coin Counting Book is the perfect introduction to counting, addition, and identifying American money. From one penny to one dollar, readers will learn the various coins, their mathematical relationships, and how to add them all together once their piggybanks are full.  Detailed photos of real money against colorful and bold backgrounds depict each coin along with their value. Rozanne Lanczak Williams’ simple rhyming text makes coin recognition, addition, and skip-counting fun and approachable for readers new to counting and currency.”

Monthly Budgeting for the Whole Family

Imagine, a future where your phone would know your financial hopes and dreams, track spending and send you an alert when you’re about to set yourself back from achieving a goal. It would update with the cost of the all the endeavors you want to achieve, from that dream wedding to the day you decide to retire.

Unfortunately, this budgeting responsibility isn’t something worth pushing off.

All the apps in the world can’t force you to say “no” to that pair of shoes or that sports car that you’ve wanted since you were a child. When it comes down to it YOU are the leader of your financial future and the cold hard truth is: Budgeting is at the center of everything.  

Teaching Kids to Budget

Our advice to parents and children?

Learn how to budget as early as possible! It will pay off in the long run.

A survey conducted by Junior Achievement and the Jackson Charitable Foundation found that the majority of parents (77 percent) feel that the best place for their children to learn the basics of personal finance is at home, at the average age of eight years old and as young as five.

Whether your student is in elementary school earning an allowance or a teen planning for the expense of college, Junior Achievement has them covered with our 2018 printable budget sheet. To learn more about working with money, check out the My Money track on JAMyWay.org.

Junior Achievement Printable Budget Sheet

The 2018 JA Teens & Personal Finance Survey

JA TEENS AND PERSONAL FINANCE SUMMARY

Overview:

In March of 2018, Junior Achievement USA and AIG surveyed 1,000 teens between the ages of 13 and 18 to gain a better understanding of their perceptions as they relate to personal finance and financial decision making. The findings of that research are summarized here.

Financial Goals

Financial Goals

One of the first questions asked of survey respondents was to select their financial goals for the future. Unsurprisingly most (75%) said "Graduating from college" was a goal. Other items included "Creating a savings plan" (50%), "Affording international travel" (37%), "Starting my own business" (30%) and "Retiring before age 65" (29%). Interestingly enough, only half (50%) of teens said one of their goals was to "Gain financial independence from parents."

Millennials have sometimes been referred to as "the Boomerang Generation" because weak job prospects in years past and student loan debt resulted in young adults moving back in with their parents following college to help manage expenses. This survey didn't delve too deeply into this subject, but one has to wonder if Generation Z sees this as a possibility for themselves after having older siblings and other family members struggle early on with finances.

Importance of Education

Importance of Financial Education

Survey participants were asked if they thought it would be valuable to have personal finance classes in high school. An overwhelming 95 percent agree. While there wasn't a large disparity in the numbers, teens from households making more than $100,000 tended to favor the idea slightly more than teens from lower-income households.

While there are states that promote some level of personal finance education in high school, most don't and in many instances courses are offered as electives and are not required.

Seeking Financial AdviceSeeking Financial Advice

Ninety-one percent of teens say they have sought financial advice. Most teens go to their parents or guardians (72%). This is followed by online resources, such as social media and YouTube (33%), other family members other than parents or grandparents (31%), friends (28%) and grandparents (18%). While teens are inclined to think that personal finance should be taught at school, only one-in-five (18%) seek out information from their high school guidance counselor. Teens in households making more than $100,000 are more likely to seek information from parents and online resources than their peers in households making less than $100,000.

Concerns About the Future

Concerns about the Future

When it comes to financially-related concerns about the future, more than half of respondents cited paying for college/student loans (54%), followed by finding a fulfilling, well-paying job (52%), not being able to afford a home (49%), not having money management skills (43%), and not having savings for an emergency (42%).

Many of these concerns were more pronounced with girls than boys. For instance, more girls than boys were concerned about paying for college/student loans (60% vs. 48%), finding a fulfilling, well-paying job (57% vs. 46%), not being able to afford a home (55% vs. 43%), not having skills to manage money (51% vs. 35%) and not having savings for an emergency (45% vs. 39%).

Thoughts on Bitcoin

Thoughts on Bitcoin

Bitcoin and crypto-currencies have been in the news. About half of teens (48%) say that these instruments have a role, but won't replace traditional money. One-in-five (17%) think they are the future of money, while about the same proportion think they are "all hype." Nearly 20 percent hadn't heard of Bitcoin or crypto-currencies prior to taking the survey.

 

Managing Personal ExpensesManaging Personal Expenses

On the subject of personal expenses, teens were asked to consider which expenses they would cut if faced with a tight budget. Respondents were reluctant to curtail more essential costs, such as paying for a cell phone (10%), Internet (8%), and even insurance (6%). Most (75%) seemed willing to cut back on entertainment-related expenses, such as streaming services.

 

Presented by:   Junior Achievement Partner AIG

 

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Methodological Notes

The JA/AIG Survey was conducted by Wakefield Research (www.wakefieldresearch.com) among 1,000 nationally representative U.S. teens, ages 13-18, who are not currently enrolled in college, between March 9 and March 16, 2018, using an email invitation and an online survey.    Results of any sample are subject to sampling variation.  The magnitude of the variation is measurable and is affected by the number of interviews and the level of the percentages expressing the results.  For the interviews conducted in this particular study, the chances are 95 in 100 that a survey result does not vary, plus or minus, by more than 3.1 percentage points from the result that would be obtained if interviews had been conducted with all persons in the universe represented by the sample.

How to Write a Check

I remember walking into the school book fair with a blank check from my parents. The purpose of the oddly shaped paper was unknown to my 8-year-old self, but the value was priceless to me. After having my teacher assist me in writing all the necessary fields, I gave it to the cashier and left with my new arts and crafts book.

Fast forward, I was writing my first check. Without a teacher looking over my shoulder, guiding me through the lines. It was one of the most stressful “Adulting” acts I had ever experienced. The priceless thrill I felt as an 8-year-old turned into fear as I understood now that in this single rectangular piece of banking perforated paper, I was giving someone permission to access my money.  

As most companies nowadays rely on technology for money transfers, it should come as no surprise that recent reports show that checks have been declining significantly in the United States. While this lost transaction art has been felt as early as the 2000s, when more than 40 billion transactions took place with checks to only 20 billion as of October 2012, there is still a need for the paper bank money order.

Fun fact for all of you wire-transferring app-tapping users out there: the decrease in check usage has been tied to a rise in Google searches for “how to write a check.” Regardless of the cause of declining check usage, it is a required and necessary life-skill to properly write a check and understand the required lines.

Junior Achievement is here to help you (and your student) to understand how to fill out a check. Don’t worry, I will be explaining it in the same way my third-grade teacher taught me.

Check writing 101


 

The check example used above is a check from Junior Achievement’s program JA BizTown®. Through this program, students practice how to (responsibly) keep a checkbook through deposit tickets, recording deposits and of course, the dreaded personal check writing. To give your child the skills they need to succeed, please contact your local Junior Achievement office.

Phillips, Matt. "The Spectacular Decline Of Checks ." The Atlantic. N. p., 2014. Web. 14 Mar. 2018.

"Where Americans Don’T Know How To Write Checks." Washington Post. N. p., 2018. Web. 14 Mar. 2018.

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