Youth and Money

4-H Update

October 3, 2000

Dr. Joyce Cavanagh

Consumer and Family Economics Specialist

Teen Themes

• Optimism

– Grown up in prosperous economic times– Confident consumers – spending an average

$82 per week

(Teenage Research Unlimited)

Teen Themes

• Techno Savvy– More comfortable with technology than

other age groups– First toys involved computer chips or

keyboards– Household ‘techies’

(Teenage Research Unlimited)

Teen Themes

• Marketing Savvy– Aware they are being targeted as a market– Unaccepting of disingenuous or pandering

messages– Want to be seen as and accepted for being

mature, young adults

(Teenage Research Unlimited)

Teen Themes

• Diversity– Pride themselves on ability to move between

peer groups and become friends with many types of teens

• Customization– Desire the ability to make mass marketed

products and services personalized– One size does not fit all

(Teenage Research Unlimited)

Teen Themes

• Adept at Multi-tasking

– Seem to juggle many different things all at once

– Access info from variety of media

(Teenage Research Unlimited)

• 12 to 19 year old population continues to rise

• In 1999, 31.3 million U.S. teens

• By 2010, projected to reach 35 million

(Teenage Research Unlimited, Zagorsky – Ohio State University)

Why Teach Financial Literacy?

• Children and teens earn, save, spend and borrow billions of dollars a year

• In 1999, teens spent $105 billion of their own money and $48 billion of family money

• Making more purchase decisions and at a younger age than previous generations

(Teenage Research Unlimited)

Where Do They Get It?

• 53% parents on an as needed basis

• 46% odd jobs

• 46% gifts

• 32% part-time jobs

• 26% regular allowance

• 13% full-time jobs(Teenage Research Unlimited)

Money From Parents

• National Longitudinal Survey of Youth– Median amount of allowance is $50/week– 50% of kids 12 – 18 report receiving an

allowance and regular handouts– Amount increases as household income

increases • $30-40k $21/week

• > $100k $175/week

Making Money

• 1999 Youth and Money Survey– Last summer

• 41% worked full-time (35+ hrs)

• 22% 20-35 hrs.

• 18% 5-20 hrs.

• 13% < 5 hrs.

• 6% did not work

(American Savings Education Council)

Making Money

• Earnings– 9% $0– 36% <$2500– 26% $2500 – 4999– 24% $5000+

(American Savings Education Council)

Saving and Spending

• 53% report making a monthly budget

• 49% report saving some of the money they receive

• 38% required by parents to save some

• Top reasons for saving– Education

– Car-related expenses

(1999 Youth and Money Survey- American Savings Education Council)

Saving and Spending

• Top items and activities students are responsible for paying themselves– Entertainment related 82%– Clothing 58%– Car or related expenses 50%– Vacations/trips w/friends 45%– School needs 31%

(1999 Youth and Money Survey – American Savings Education Council)

Why so Much $$?

• Parents are wealthier – trickle down effect

• Time strapped parents using $ as a substitute for time

• Guilt• Today’s kids have more ‘needs’

(Teenage Research Unlimited, Zandl Group)

Does Experience = Success?

• Financial Literacy declining

– High school seniors in 2000 scored 51.9% on personal finance survey

– Decrease from 57.3% in 1997

(Jumpstart Coalition)

Educational Resources

• HES Resource Library– outreach.missouri.edu/hesresource/resdb– Variety of resources, curriculums, videos,

books, etc. for checkout– Contact Terry Gatewood at

gatewoodm@missouri.edu

Educational Resources

• Consumer Critter Crew– 9 to 11 year olds– 4-H Curriculum (Texas)

• High School Financial Planning Program– 11th and 12th grades– Basic financial management skills

Resources on the Web

• Outreach and Extension– Outreach.missouri.edu/ceupdate

• Jumpstart Coalition– www.jumpstartcoalition.org

• National Endowment for Financial Education– www.nefe.org– www.nefe.org/amexeconfund/index.html

Resources on the Web

• National Institute for Consumer Education– www.nice.emich.edu

• University of Missouri-St. Louis, Center for Entrepreneurship and Economic Education– www.umsl.edu/~econed– www.wisepockets.com

Resources on the Web

• American Savings Education Council

www.asec.org

• U.S. Treasury

www.treas.gov/kids/