Fifty-one percent of Americans don’t have enough savings to cover three months of expenses in an emergency, and 25% have no emergency fund at all, a Bankrate survey found.
More than one in four Americans report they don’t pay their bills on time, a National Foundation for Credit Counseling survey revealed.
Meanwhile, 53% of U.S. Consumers are living paycheck to paycheck. That is according to a LendingClub Corp. survey.
These statistics help highlight the need for financial literacy education at an early age, and the village of Lynwood is tackling the issue with a pilot program for high school students.
Saturday mornings, Lynwood and other south suburban high school students participate in the financial education program, which covers topics including spending and budgeting, saving, financial planning, using credit and credit cards and managing one’s paycheck.
“Finances will be a part of your life whether you are wealthy or have little or no money,” said Lynwood Trustee Cynthia Eaves. “You need to be able to manage what you have correctly, and that’s what we want to teach them. We want to give our kids exposure so they will be able to advocate more for themselves and become more financially literate.”
Eaves, who chairs the village’s Finance Committee, suggested the initiative this fall. The free program launched Oct. 23 with the support of the committee and Lynwood Mayor Jada Curry. It will run through Dec. 18.
The program teaches portions of the “Money Smart for Young People” curriculum developed by the Federal Deposit Insurance Corp. Lynwood Finance Committee members and community volunteers lead the sessions, which also teach other life lessons.
One recent session was led by Lynwood resident Larry Powell Sr., founder of Homewood-based Guardian Insurance & Financial Services. At the session, students were asked to research careers they might be interested in and salary levels and share that information with the group.
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Lynwood resident Marian Johnson, a licensed real estate broker and former IRS tax examiner, led a session on the importance of budgeting and not overspending.
“It’s important that children learn about money,” Powell said in an interview. “It’s something that they are going to use for the rest of their lives.”
His goal is to help participants become “critical thinkers” as it relates to their spending habits, overall money management and career choices, he stressed.
“There is a need for financial literacy targeting high school students, and there is a particular need for financial literacy targeting high school African American students because they most likely haven’t gotten training at home,” said Randall Blakey, a Lynwood trustee and Finance Committee member.
“If they have gotten this training at home, it’s either been through watching their parents and older members of their family with their good habits or watching them with their bad habits,” Blakey said. “You want to make sure at this stage if they have embraced bad habits, to nip those in the bud and put them on a trajectory to develop good habits in terms of understanding how to save, understanding how money can work for them.”
Blakey said his session focused on preparing for success.
“It dealt with decision making, forecasting and discipline,” he said.
He stressed the importance of students thinking now about what they would like to do, how to best prepare and what short-term goals they want to achieve that will help them realize their long-term career and financial goals.
This past Saturday, Shari Aguilera, vice president and branch manager of First National Bank of Illinois, who oversees locations in Lynwood and South Holland, provided information on savings accounts. She said roughly half the students didn’t have any bank accounts. She received questions from the students about applying for college financial aid and loan applications.
Aguilera plans to bring in sample loan applications. She will walk students through the process of what applying for a loan entails to educate them on the importance of being financially stable and the role savings, checking and investment accounts play in everyday adult life, she said.
“A lot of our children are getting out into world and don’t realize the value of a dollar, what it really takes to financially plan their future, maintain a household, pay a mortgage or rent,” she said. “A lot are just going into college. They get credit cards that are just thrown at them, and at the end of their freshman year, they are in credit card debt.”
Johnson said she wants to help youth avoid that trap.
“We need to give them the knowledge and tools they need to make sound financial decisions,” said Aguilera.
Sixteen-year-old Aniah Johnson, whose goal is to become a psychiatrist, said she is participating “to get personal knowledge for myself.” The Lansing resident said she wants to “learn about college scholarships, what I should be looking for in jobs, what should I be making at age 30, 40, how can I build income.”
Lynwood resident Alexander Ledford, 16, learned about the program through his grandmother, who received a flyer in the mail and asked if he wanted to participate. Ledford, who plans to attend college and major in engineering or computer science, said he wants to learn more about managing money and how to use debit and credit effectively.
Ledford said a criticism has been that schools fall short “in teaching you how to live in the real world.” The Lynwood program is tackling that as it relates to managing money, he said, adding “this is necessary especially in high school.” By the time students graduate it’s important they know how to use money wisely, he said.
Sandra Chandler, Ledford’s grandmother, said she hopes he and other students learn the “importance of saving and not to throw money away on frivolously things, that credit gives you options, but that in order to get good credit, you have to pay your debts on time.”
Fifteen students are enrolled in the pilot program. Eaves said she plans to pursue grant funding next year to expand the initiative and is hoping to make it an annual program.
The program is the first of its kind for Lynwood, said Eaves and Blakey.
Blakey hopes the students’ younger siblings will participate when they enter high school.
“We want to see it grow and benefit generations to come,” he said.
Because of COVID-19 protocols, advance sign-up is required for the program. For more information, email [email protected], or call 708-935-5803.
Francine Knowles is a freelance columnist for the Daily Southtown
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