Tuesday, May 7, 2013

My First Paycheck - Now What?

financesIn Preparing students for real-world financial success, Lisa Nielsen states,

“Students often begin pursuing employment as early as high school, but they are not taught best practices when it comes to managing their money.”

Many people I talk to don’t realize this until we are discussing it. Then we talk about how we learned or when we were taught. Many were taught by their parents but now with so many children living in single parent homes or being brought up by grandparents, I think this real life skill is falling by the way side. I learned a hard lesson about credit cards when I graduated from college and maxed out my new credit card. No one taught me how credit cards worked and my parents never had one so they couldn’t teach me. I was thrilled that I was able to get something that my parents didn’t. Luckily, when I got married, my husband had more money sense than I did and got my finances on track.

Here are some skills that I think we need to teach our students. These can be incorporated in lessons for reading, math, social studies, social skills, and/or career preparation.

1. Bank Accounts - how to open up checking and savings accounts, what bank fees are involved, how to balance the accounts, withdrawing and depositing money, penalties

2. Banks/Credit Unions/Rent to Own/Check Cashing Companies - Look at the different types and compare

3. Loans - loan applications, fees, final payoffs, interest payments

4. Health insurance - benefits, costs, comparison shopping

5. Car insurance - benefits, costs, comparison shopping

6. Credit cards - reviewing statements, annual fees, interest charges, other fees

7. Pensions/Retirement - how does the system work

8. Taxes - state, federal, sales

9. Buying a Car - comparison shopping, taxes, maintenance costs, other costs

10. Renting an Apartment/House - comparison shopping, fees, utilities, deposit, maintenance

11. Buying a House - costs, fees, different types of loans, interest, final payoff

12. Budgeting - How to set up a budget, look at expenses and income

These are just some of the things I wish someone had taught me so I didn’t have to learn the hard way. I believe by learning these things, students will be more successful in life. What other financial life skills do you think students need to learn before they leave school? Please share.

Image: 'Dollar in Piggy Bank'
Found on flickrcc.net

1 comment:

Cayla Dupont said...

This is very helpful! I also believe that these are the things that we have to teach to the young ones before they step out to the real world. I'm thankful that my dad taught me some things he learned in life: that is to invest on a health insurance because illness can be our worst enemy when we get old. Anyway, thanks for sharing this article, and I hope others would convey this list to their kids.

>Cayla Dupont <