Finance advise to highschoolers

[NextInLine]

A friend asks me to give a talk to advise high-school kids. I am thinking about topics such as: the power of compounding interest, saving early, asset allocation. Is there anyone give such talk and have some materials (slide)?


thanks

 

[Jerry1]

Stress a budget. Kind of goes along with saving early, but not the same. Knowing what you spend money on is a very important tool. Not sure at a high school level how much I’d get into asset allocation.

How long are you supposed to talk and what if any guidance were you given on the goals of the discussion?

 

[Luck_Club]

Simple:
Don't spend more than you earn ever! Save a little for emergencies.
It's only OK to go into debt for huge returns ie college debt: car to commute to a job; house that appreciates.

Worked for me.

 

[savory]

I just want to say that what you are doing is terrific. I think financial management should be taught at every school and more than once.

When I taught my kids and discuss finances with friends, the one thing I stress is that we work for financial independence. The goal is not to stop working/retirement. It is to have choices in life that only come when your FI. Setting a timetable and plan for FI is a critical first step. I think if you teach only that in one session, you will have had great success.

Good luck.

 

[Bamaman]

Young people also need to be taught how to make more income. I'm talking how much more a college graduate make than a H.S. graduate and especially a dropout. Or, the importance of obtain a marketable trade or job skills and do do the best job you can. And don't be satisfied to live on the lower end of the social scale--fast foods, welfare, etc.

 

[Helena]

.

Back in the 50s when I was a young child, I had a huge ceramic piggy bank that was kept on a shelf in my bedroom. From time to time I would use a chair to get it down so I could count the coins. One day as I reached for piggy, it dropped to the floor with a loud crash... coins and pieces of piggy went everywhere! Around that same time at the Odessa, Texas Oil Show, I was given a self-assemble cardboard bank shaped like a house that had the words: "A penny saved is a penny earned."

Back in the 60s, my sixth grade public school class went on a field trip to the local bank so the students could open savings accounts. I remember getting a small savings account passbook. Later, every other Friday, students could give the teacher money to deposit into their accounts. By the time I reached high school I had almost $100 in my account which was a good sum back then.

Those memories stayed with me all these years because they were my first early lessons on saving money.

.

 

[ugeauxgirl]

No more Harvard Debt (blog) has a fantastic post called "teaching a debt perspective to 12 year olds" Its fantastic. Showed it to my kids- they were momentarily speechless.

The one that impacted me the most (my dad showed me when I was in HS) is the chart that is in nearly every investment book- the one that shows compound interest. How a kid starts saving at 18- $100 per month, or something like that for 10 years. The next person starts at age 28, at the same interest rate- saves the same thing for the rest of their life and never catches up. I never forgot that.

 

[Aerides]

Have some real life examples. maybe start with the shutdown and what that meant to miss paychecks - ie, importance of emergency funds?

Then things like what a 401k is, what income taxes are. Was just last week explaining to my almost 17 year old niece what a salary of $100k really means after taxes and healthcare, especially in a high SALT state. You could make a simple pie chart for a typical post-college starting salary, and show how much money is really left after taxes, insurance, rent, groceries, utilities, etc.

Show what a 3% savings rate means vs. a 10% savings rate over 10 years (make a simple chart for this). Then maybe what credit cards really are, and how debt should be avoided (aside from cars, houses, and even then, with care).

I'd go super basic to start, with emphasis on tools to get them started and through their 20's. Talking further out than that is going to just lose the audience.

 

[ocean view]

Explain that credit cards should be used as a convenience, not a loan. And as such should off be paid in full every month.

 

[timbervest]

Depending on the age of the audience a very good age appropriate resource for 14-17 year olds is the Boy Scout Personal Management merit badge. You can google the requirements but it covers financial literacy, saving and investment, budgeting, credit cards, time and project management, and other topics. I taught this to my scouts for years and most of them said it was the one of the merit badge they did that they actually used in their adult life.

 

[Brat]

Back in the day teachers would invite me to talk to students about employment. One of my standard lines was to look at a potential employer as if you were loaning them money. The time between your clocking in and getting paid is, basically, a loan. I encouraged them to keep a personal, detailed, record of hours worked.

A lot of teens were shorted by employers such as gas stations and door-to-door sales operations. I recall one student who raised her hand and told her classmates that I had recovered hundreds of dollars of wages for a family member and thanked me.

 

[Scuba]

A friend asks me to give a talk to advise high-school kids. I am thinking about topics such as: the power of compounding interest, saving early, asset allocation. Is there anyone give such talk and have some materials (slide)?


thanks

I did this last year and probably still have a PowerPoint. Happy to share it if you PM me with your email address.

 

[brucethebroker]

Young people also need to be taught how to make more income. I'm talking how much more a college graduate make than a H.S. graduate and especially a dropout. Or, the importance of obtain a marketable trade or job skills and do do the best job you can. And don't be satisfied to live on the lower end of the social scale--fast foods, welfare, etc.

1+.
I would add telling them to get some advice before taking on huge college loans. I know teachers who carry enormous amounts of school debt. That might be OK for Dr.s and Engineers, but it will cripple most teachers. And the prior advice about compound interest is good.

 

[DrRoy]

Plenty of good stuff here. All my thoughts are covered. I generally recommend "Your Money and Your Brain" by Jason Zweig.

 

[Nick12]

Teenagers are easily influenced by many things on social media. Some tend to listen and apply things to their lives instead of listening to their parents on subject matters. There was an article about how to delay gratification. Too many times without a plan and or money to support it, the young people gratify themselves and think it makes them feel good and important. Stress to the kids time is money. The more you save and invest long term , pay off debt, you will see that your $$$ is going to work harder than you do and in the long run you will see the benefits. It’s all about personal choices so don’t blame the other guy when things don’t work out.

 

[artformoney]

money 101

I've taught illustration/animation classes as an adjunct at the local community college for many years. A few years back I started taking one class period during the semester to go way off topic and into basic personal finance, giving a lecture/discussion which I call Money 101. I've presented portions of it to high school classes I've spoken with as well, and the topics covered were well received.

Here's a link to the Evernote outline (with links) I created for that talk. Feel free to use/share any of it if it helps you in planning your talk.

Money 101

I was spurred to do it after reading an Atlantic cover story from 2016 detailing how many folks would have trouble coming up with $400 to cover an emergency. Knowing most of my students come from modest means and faced the imminent possibility of making large financial decisions (cars, student loans, etc.) they may not be prepared for (but might have a huge impact on their futures) I thought it could be a class that had much more relevance to them than anything else I covered the rest of the semester. I was correct, given the feedback I've received from the students each semester I've presented the talk/discussion.

 

[gcgang]

The secret to financial success : buy your toilet paper on sale (Tobias).

From that you can go through needs vs wants, after tax/before tax, how much you save vs how much you'd have to earn, and the evils of debt/how compound interest works.

Make it fun.

 

[Sanstar]

Agree with “make it fun”. I’d remind them that everyone needs and wants money. Once you have some, it’s the number one job of many others to get it from you; this includes family and friends. It’s hardwired into our DNA. This results in behaviors like cheating teens out of pay for their worked hours, up pricing toilet paper, high fee mutual funds and advisors, student loans, car loans, ect... It’s a game that never ends and one you don’t want to lose. Winning the game means knowing the difference between a need and a want, buying on sale and using coupons, reading the fine print and considering the source of financial advice, saving up to buy in order to keep interest costs in your pocket, letting someone else pay for college via scholarships, military service, employer tuition assist programs. Better tool than budgeting is tracking. Every penny in and every penny out. There are apps for this. Having enough left every week to invest means you won the $ game that week; the higher percentage, the bigger the winner! Maybe recommend a couple podcasts geared to younger people and early earners. Not all of us are readers. Learn, learn, learn; from others you admire, from research and from your own decisions and behaviors related to money; use this newly acquired knowledge to make different decisions and learn from them. Repeat. Younger people have time to make mistakes but that time is rapidly running out. In no time at all their won’t be enough time left in life to recover from poor decisions. Ask them, “look around, do you want to be the 70+ year old working the cash register and bagging groceries all day or the 70+ year old loading fine food and drink in his luxury SUV headed to his vacation property with his family and friends? No one wakes up in one camp or the other. It’s the end result of a lifetime of decisions and behaviors. Yesterday is not too soon to begin learning and applying sound money management principles and practices.

 

[Scrapr]

I've taught illustration/animation classes as an adjunct at the local community college for many years. A few years back I started taking one class period during the semester to go way off topic and into basic personal finance, giving a lecture/discussion which I call Money 101. I've presented portions of it to high school classes I've spoken with as well, and the topics covered were well received.

Here's a link to the Evernote outline (with links) I created for that talk. Feel free to use/share any of it if it helps you in planning your talk.

Money 101

I was spurred to do it after reading an Atlantic cover story from 2016 detailing how many folks would have trouble coming up with $400 to cover an emergency. Knowing most of my students come from modest means and faced the imminent possibility of making large financial decisions (cars, student loans, etc.) they may not be prepared for (but might have a huge impact on their futures) I thought it could be a class that had much more relevance to them than anything else I covered the rest of the semester. I was correct, given the feedback I've received from the students each semester I've presented the talk/discussion.

Very nice. I will share with my son. He knows all about FU money aka emergency fund. I about fell over a couple years ago when he quoted it to me. LOL But this is a good primer. We (I) did not do a great job with him on money management

 

[ncbill]

Consider the U.S. military to pay for their postsecondary education:

Reserve Officers' Training Corps (ROTC) national & campus-based scholarships, service academies, tuition & fee waivers at public in-state schools for National Guard members in many states, GI Bill.

Health Professions Scholarship Program (HPSP) after the 4-year degree for those interested in a medical career.

My oldest started at a local private university on a 4-year national Army ROTC scholarship, but then moved on to a service academy after a year.

Other kid received a campus-based 3-year Army ROTC scholarship & their private school offered a 50% scholarship for their first year.

 

[Nick12]

A friend asks me to give a talk to advise high-school kids. I am thinking about topics such as: the power of compounding interest, saving early, asset allocation. Is there anyone give such talk and have some materials (slide)?


thanks

In the boarding prep school I went to in the 1980s ( I was on financial aid), from time to time successful alumni came to visit campus and talk about their tips to make it in the business world. The kids including me were glued to their every word and could ask questions to them later. Even though most kids came from wealthy families, some of them worked their butts off 80-90 hours a week on Wall Street if that is what it took. Some alumni only saw their wives and kids on weekends. Some stories were their fathers were hard driven and did not give their kids a golden spoon all the time.The kids nowadays and in the past are easily influenced by what they hear and see.

 

[gstillson]

Show them how much the $100,000 they are thinking of taking in school loans would be in 40 years if invested at a yearly return of 9%.

 

[38Chevy454]

Lot of good points, I'll add a few:
1. they should understand the bad effects of debt, especially debt that does not work for you like credit cards and consumer goods
2. learn how to balance a checkbook
3. teach the power of compounding, and saving early
4. LBYM
5. basics of stock market investing

 

[NextInLine]

Lot of good points, I'll add a few:
1. they should understand the bad effects of debt, especially debt that does not work for you like credit cards and consumer goods
2. learn how to balance a checkbook
3. teach the power of compounding, and saving early
4. LBYM
5. basics of stock market investing

Great points here. This is how I reach a mega mark at age 40 after getting to the US at age 22 without any English.

 

[NextInLine]

Stress a budget. Kind of goes along with saving early, but not the same. Knowing what you spend money on is a very important tool. Not sure at a high school level how much I’d get into asset allocation.

How long are you supposed to talk and what if any guidance were you given on the goals of the discussion?

NO guidance. It is about 45 mins section including Q/A.