Teens Becoming Financially Literate
GRAND RAPIDS — A group of teenage boys at St. John's Home learned something about money management and fiscal responsibility over a three-week "mock economy" simulation conducted by Bank One last month.
For the nine boys, ages 14 to 17 and all residents of St. John's Richter House, it was a hands-on lesson in basic economic survival designed to teach them the value of money and the adult responsibilities they'll have to assume when they're on their own.
Bank One volunteers coached the boys on interviewing skills, appropriate dress and behavior on the job, then interviewed and hired them for various on-campus jobs.
The boys earned "Richter Dollars" to help cover their "living expenses" and had the opportunity to earn additional money by attending financial literacy classes. They had to decide for themselves whether to deposit leftover dollars into a savings account or spend it on "temptations" such as video and computer game rentals.
The project was designed to motivate the teens to set financial priorities and use their credit wisely, explained Ruth Vis, Bank One vice president of public affairs.
Vis said the bank's corporate giving guidelines focus on financial literacy and community economic development, and that developing people's money management skills is key to its community involvement initiatives. Bank One contributed a grant of more than $10,000 and eight employees volunteered more than 50 hours to the project.
St. John's Home provides intensive therapeutic treatment for abused and neglected kids. As Richter House Manager George Ward pointed out, unlike the home's younger residents who are adopted or placed in foster homes, the older teens tend to move on to independent living or semi-independent living situations when they leave St. John's, so they have to be prepared to assume independence.
He figures seven of the nine Richter House residents will either be on their own or will become "a tenant" in a supervised community living situation when they leave St. John's.
A lot of kids don't have a realistic understanding of their wants and needs or how money should be budgeted, because as children, those things are usually provided for them, he explained.
Ward said St. John's staff adopted a hands-off policy during the simulation because they didn't want to be "punitive or offer consequences."
"We wanted to let real-life scenarios set in, meaning that if you refused to go to work or showed up late for work, your pay was going to be docked," Ward explained.
The teens got a dose of reality because if they didn't think ahead and budget their money, when it was time to pay the mortgage or a bill or buy food, they might come up short, he added.
For actual classroom instruction, Bank One brought in three local people who have been working with high school students on financial literacy.
"They were looking for an opportunity to pilot their newly developed program with a smaller group of students," Vis said. "We provided the site and refreshments and they came in and did the actual training with a ready-made curriculum."
On the first day of the program, Bank One awarded two $50 savings bonds following the boys' tour of Bank One and a test on what they learned, Vis noted. At the end of the program, Bank One awarded the two "top performers" with savings bonds in the amount of $200 and $100, respectively.
"We looked at who had the best attitude, who was the best player and took it seriously and really worked. One of the boys opened a savings account, worked two jobs and amassed a large amount of money. He was a real go-getter — just an Energizer Bunny."
As a cap to the project, the teens were rewarded with a day trip to Chicago that included a visit to Navy Pier and the Federal Reserve Bank of Chicago.
"The boys were just totally amazed by the amount of money that is being circulated in the United States," Ward recalled. "We did a bunch of things in Chicago that these kids have never experienced. It really broadened their horizons and pulled them together as a unit because it was something they shared."
Though the details haven't yet been worked out, the home's hope is to follow up with another mock economy that would expose teens to the college experience. For example, the teens might get faux financial aid checks that they have to budget to cover "college expenses," they'd have to attend a set number of literacy courses and be responsible for turning in all their homework.
Ward said the central role Bank One played in the project was "invaluable" and gave special credit to Vis and Armando Hernandez, vice president of community reinvestment, for their "input and passion."
It was an enjoyable and rewarding experience for Bank One volunteers as well, Vis noted.
"I think we made some strong headway in providing financial awareness and literacy that these guys didn't have before, but that they will need when they turn 18."