Athan Tucker, 18, feels really lucky that he got a good education in personal finance at the NextGen Trades Academy, a program of the nonprofit LIME Foundation in Santa Rosa. The academy prepares students to get jobs in the construction trades, and it includes personal finance because LIME Foundation founder Letitia Hanke knows money management is a vital life skill.
Personal finance was Tucker’s favorite part of the NextGen curriculum. He’d had some personal finance in high school, but not like this.
“It was unlike any class I’ve taken before. It was a great opportunity that not a lot of people get,” Tucker said. “Budgeting, saving, those are very important things I really need to know. Right after class was over, I immediately started investing, setting up a budget. I’m super happy to know how to do that.”
Right after class ended he also got a job, snapped up by Redwood Moving & Storage in Santa Rosa to help with all aspects of hauling freight. Tucker feels confident he knows what to do with that paycheck.
“If you’re getting out of school and want to go to college or move out on your own, you have to know how to manage your money,” Tucker said.
NextGen Trades Academy is an example of several community efforts to expand personal finance education in Sonoma County. Many developed online versions during the pandemic.
“I think there’s probably an urgency because of the worry over financial stability. People want to know what to do. People are thinking about what you need to have in life,” said Susan Campbell, a professor of education at Sonoma State University who is developing personal finance curriculum for teachers.
While the efforts reach only a fraction of Sonoma County’s 68,194 school-age youth, which includes about 21,600 high school students, they are an indication of how seriously the problem of financial illiteracy is viewed by local business leaders and educators.
The financial strain imposed by the pandemic upon many individuals and households has led to a flood of cries for help from people who have no savings, too much debt and no plan for riding out an unexpected disaster, according to local safety net providers, including nonprofits and government agencies.
The lack of financial education for many has exacerbated the crisis and spotlighted the importance of new and ongoing efforts to fill that learning gap.
Banking sector responds
Vic Trione, chairman of the board of Luther Burbank Savings in Santa Rosa, has partnered for 25 years with Junior Achievement, a 102-year-old international nonprofit that sponsors free curriculum and activities to help youth in the areas of work readiness, entrepreneurship and financial literacy.
For example, in 2019 and 2020 Luther Burbank Savings provided major funding, planning and staffing for JA Finance Park Mobile, which last year taught personal finance to more than 800 middle and high school students from over 20 classes at seven schools in Sonoma and Napa counties. Trione has committed to expanding the program in the future.
Students start the program with 13 weeks of personal finance education in their classroom or online, with curriculum from Junior Achievement of Northern California and volunteer teachers upon request. To practice what they’ve learned, students spend a full day at the mobile Finance Park, held at the Sonoma County Fairgrounds.
With an iPad in hand, they travel among 22 business kiosks where they shop for their family’s needs — like housing, groceries, insurance and child care — while trying to balance the budget they have been assigned.
JA Finance Park Mobile can accommodate about 100 students per day and last year ran for two weeks in February. Trione and his team signed up 80 volunteers, including 42 Luther Burbank Savings employees, to staff the event. Five other banks also participated. An enormous undertaking, it takes a year of planning, said Warren Harris, a senior vice president at Luther Burbank Savings.
Trione is passionate about the need for personal finance education, and every morning of the event he personally welcomed the students to Finance Park. Chuckling, he recalled asking a student what he got out of Finance Park, and the boy replied, “I know one thing. I’m not having any children. They’re too expensive!”
“We see their eyes open wide,” said Mona-Gail Baker, a loan underwriter at Luther Burbank Savings. With their new understanding of what it takes to run a household, “I think a lot of them go home and hug their parents.”
Credit union a key player
Brett Martinez, president and chief executive officer of Redwood Credit Union, is also committed to offering free financial education to area youth. Since 2004, when Redwood introduced youth accounts with newsletters, the credit union has initiated several programs to connect youth with the life skill of money management.
In 2009 the credit union introduced a four-day “academy” that was held biannually during spring and summer breaks for five years, but reach was limited due to competition from family vacations and other scheduling issues. Since 2013 Redwood Credit Union has provided high school and college students with “Bite of Reality” financial workshops, where more than 16,000 youth have spent up to 2½ hours managing money as if they were an adult, said senior vice president Matt Martin.
The students get a fictional identity, with a job, salary, family, credit cards and a checking account. They visit tables manned by volunteers where they buy life needs, such as housing, transportation and child care, and try to resist temptations. Woe to those who are suddenly handed an unexpected tragedy, like a car wreck or illness. If they overdraw their checkbook, “financial wellness counseling” is available.
In October 2019 the “Bite of Reality” event was the largest ever. The credit union closed its offices so all of its 700 employees could volunteer at 15 high schools in Sonoma, Marin and Napa counties and show 3,100 students what it takes to navigate the financial side of life.
In another effort, Redwood Credit Union and 100 Black Men of Sonoma County teamed up in February to offer online financial literacy training to up to 25 Napa and Sonoma County youth ages 12-20 on a first come, first serve basis.
“It’s all about giving people the important tools they need to achieve their goals and dreams,” said Martin.
Foundation spearheads training
The local nonprofit Career Technical Education Foundation, which makes grants to high schools to enhance vocational education classes, began in 2013 and with the urging of Redwood Credit Union requires CTE teachers to include financial literacy lessons. Redwood has donated $70,000 to the effort, and more than 4,000 students have benefited, said foundation CEO Kathy Goodacre.
The curriculum includes six topics: money management, borrowing, earning power, investing, financial services and insurance. Borrowing is “a really important one,” said Goodacre. The foundation asks teachers to cover at least four topics, or two topics and a “Bite of Reality,” unless their school already requires personal finance education, as Healdsburg High School does, for example. Healdsburg High School requires financial literacy units in the 11th and 12th grades, including developing post-high school personal financial plans.
The CTE financial literacy curriculum is available online, making it accessible for teachers and students during distance learning, and also aligns with academic lessons in English, Math and Social Sciences, Goodacre said.
“It is core to what we do that students leave high school with some understanding of how life works in the real world and how to apply what they’ve learned to be successful community members,” said Goodacre.
After teaching two of the modules in Money Management, one high school math teacher assigned students to create a personal budget which included researching options for buying a car. One student expressed, “I can’t afford the car I really want, so I am going to buy a small car that gets good gas mileage and has less than 100,000 miles on it. That way I can actually save enough money.” This student shared that by graduation he not only had enough for the car, but had a little leftover he might invest for the future.
Another high school teacher said in a report to the foundation, “I think the curriculum should be taught in a semester-long course that is required for graduation. I know if students signed up to take this course they would love it and learn a great deal.”
Finance experts head to classrooms
Community First Credit Union: When teachers invite them, Community First sends employees into high schools in person or by Zoom with financial literacy presentations. For example, earlier this year lead trainer Rebecca Nystrom presented to the Healdsburg High School junior class in four back-to-back 70-minute sessions and to the senior class at Anderson Valley High in Boonville.
“We want this generation of students NOT to repeat the financial mistakes made by adults, elected officials and captains of industry during the past decades,” says the website. The syllabus for the class includes the ease of saving loose change, smart spending and budgeting, an introduction to credit scores and why they are so important and what it all means for college and jobs.
“We were founded by school teachers in 1959, and we continue to teach,” said David Williams, chief marketing and human resources officer for Community First Credit Union in Santa Rosa.
Campus revives financial ed courses
Santa Rosa Junior College has brought back two free and bilingual financial literacy classes it introduced in adult education in 2017 but did not offer in 2019 for lack of student interest.
The 2020-2021 school year was different. Fall and spring classes were full, and the course will be offered again in the upcoming fall semester which begins August 16. Classes are currently online because of COVID-19.
“We’re hoping everyone across Sonoma County will be able to take advantage of this,” said Nancy Miller, who recently retired as director of the school’s Regional Adult Education Programs. To enroll, email firstname.lastname@example.org or call 707-521-7962.
The first class is about personal money management. The second is about investing and planning for retirement. That’s a chance to teach a favorite concept of financial experts: compound interest and the big gains that can come from reinvesting earnings on top of earnings over time.
“The most important thing every kid should learn is the earlier you start saving the more likely you can benefit from compounding,” said David Lawrence, an investment adviser with Willow Creek Wealth Management in Sebastopol. “Let the markets do the work for you over time. It’s free money basically. I love to talk to kids about that, getting them to think more about the longer term.”
“When my kids and my nieces and nephews graduated from college and took their first job, I literally sat down and talked to them about saving, particularly about 401(k)s, pretax contributions and the value of compounding. ‘This can be over $1 million one day,’ I tell them,” said Michael Sullivan, chief credit officer at Exchange Bank in Santa Rosa.
Planning for your financial future is crucial, retired educator Miller agrees. “My twin children are 33. I started talking to them about this when they were 16. They rolled their eyes. Now they thank me.”