One of the FAQs that always comes from teens is when they should get their first credit card.  I explained that with the changes in the Credit Card Act, teens wouldn’t necessarily be able to obtain their own credit card when they turned 18 without meeting certain requirements.  The age of credit card consent now appears to be 21.

Instead of reacting with frustration, as I’d imagined, the audience burst into… applause? 

Indeed, they did.  It appears that the teen audience I spoke to thinks credit cards are just one thing too many for students grappling with so much freedom at one time.  As one student said, ‘I think it’s good to ease into the whole adult thing.  Credit cards just add too much pressure’. 

Whether they’re too much pressure, or teens are at a loss as to how to use these all-important financial building blocks, the good news is that credit unions are providing students with unbiased advice about how to wisely use credit cards.  Whether they utilize it at age 18 or age 21, these teens now have the skills to make safe, sound credit choices.

With the Senior Boards dominating the entire week, Juniors at Tahoma wanted the chance to get an edge on their own futures, and in particular, their finances.

During the 50 minute long Credit University presentations, three audiences had the opportunity to learn about the dangers of identity theft, the path to earning and keeping good credit, and how the two of those in combination result in additional resources that can be saved at a local Credit Union.

As usual, teens are always excited to learn about these topics in a way that appeals to their own interests. What was particularly nice about this event were how many students waited after class to shake my hand, tell me how they’re going to use the information, and to express their appreciation for my time.

If you’d like to bring credit union sponsored Credit University to your youth orgniazation this summer, get in touch with us here.

Melodi was really looking forward to her weekend.  Her friend had just gotten a new car, and they’d planned a ride into the city followed by a little exploration of downtown Seattle.  She had no idea she was about to be a victim of a crime.

Melodi knew she’d be walking around for a couple hours and decided to keep her purse safe, locked in the back of her friend’s car.  The hatchback had tinted windows that almost completely obscured the purse in the back of the car.  Almost, but not quite.

After an afternoon of fun, Melodi and her friend returned to the car only to discover the window had been smashed out.  Melodi’s purse was gone.  In her purse was her new digital camera, her iPod Touch, and a wallet that contained her driver’s license and debit cards.  The adjacent two cars had also been broken into.

Instantly, Melodi and her friend sprung into action and followed the protocol to limit the damage done.  First, they called the police.  Now with a police report in hand, Melodi will be ready to combat any potential financial issues that arise due to her identity in the hands of a criminal.  Second, she got a temporary license and shared her story with the department of licensing.  Third, she plants to go to www.annualcreditreport.com and check her credit within the next two weeks.  Doing so will help determine if someone has attempted to open any accounts in her name.  Finally, Melodi’s going to consider whether or not putting a credit freeze on her credit report is a good idea in the short term.

Because Melodi reacted so quickly, it’s likely she’ll stop an identity thief in his or her tracks if they try to use her personal information.  Knowing how to respond to a crime is just as important as how to prevent it.  If you want to learn more about protecting yourself from identity theft, how to manage credit, or how to maximize your savings, invite Credit University to your Western WA high school.

After learning about their teen risk factors for identity theft, how to build a good credit rating, and how their savings is maximized when located at a credit union, they wanted to know more.

During the 90 minute workshop one question kept coming up:  Why, when all the adults in their lives are struggling with so much debt, would a teenager ever want a credit card?  And if one is required, when should a teen considering applying for one?

After discussing the perameters of the Credit Card Act of 2009, students realized that unless they were able to prove adequate income or have a co-signor they wouldn’t be able to obtain a card in their own name until age 21.  Ok.  But why get one at all?

There are cases when making purchases with a credit card offers you distinct advantages over using a debit card.  Anytime I purchase something online I always use a credit card.  In the event that someone steals my card number and goes shopping with it online, I’m only liable for the first $50 spent on my card.  Some card issuers, however, offer zero liability to their customers for such theft, which is an added bonus.  Further, federal law says I’m free of the liability associated with that theft if purchase were made where the card was not physically present. 

There’s also an added benefit:  Wise use of a credit card establishes your credit history and raises your credit score.

While your debit card will only hold you accountable for the first $50 spent on your card, it requires that you notify the financial institution within two business days of the loss or theft.  In some cases, zero liability applies only when your PIN wasn’t used during the transaction.  As long as the theif didn’t steal your PIN along with your card number, you’re probably okay.

At the end of the day, the choice to get a card card is a personal one that involves multiple factors.  We’re all responsible for deciding our own comfort level with what we borrow, our ability to handle debt responsibly, and our capability to pay our bills on time. 

If you’re interested in learning about Credit University or about credit unions near you, contact us.

“I receive funding from social programs that pay my tuition and support my kids.  My aid checks are based on what I have in my accounts.  How do I save for the future when it might reduce my aid”?

Christina has a great point.  While ideally we have to look at our dollars in terms of how they can support us today, tomorrow, and in the event of an emergency, there are times when saving is difficult for reasons other than the size of our paychecks.

If you’re applying for a student loan or weathering hard times with the support of some sort of aid program, know the rules.  Research the program before you apply.  Find out what could limit your ability to be accepted.  Inquire about the maximum dollar amount that you can save and invest prior to impacting your eligibility for the program, and see if retirement account balances, such as an IRA or Roth IRA, are exempt from qualifying resources.

Living without an emergency savings account is like skydiving without a parachute:  It rarely ends well.  Simultaneously, these aid programs help us earn the bigger paycheck that will eliminate our need for aid.  Seek a balance where you can get the support you need while squirreling away just a bit for that inevitable rainy day.

Over the course of two days, all students received an amazing array of investor education resources from the Investor Protection Trust.  The WA State Dept. of Financial Institutions also contributed their booklets and brochures designed to support efforts to save and invest safely and wisely.

60 teens spent this school week learning how to become the next generation of successful business professionals.  Divided into teams and led by educators and business professionals in tandem, students competed with one another over the course of the week while running a business simulation to become the most profitable business. 

In addition to learning how to run a lucrative business, these teens learned about the stewardship responsibilities associated with being a successful professional.  Learning how to treat value co-workers, to respect the environment, and how to plan for emergencies beyond our control – all of these are skills needed in today’s workplace.

Students also had the chance to learn about creating and building their own most profitable life.  Through a generous grant from the Investor Protection Trust and the Support of the Dept. Of Financial Institutions, teens heard the Investor Education in Your Community presentation and learned about the magic of compounding interest and the ease with which tomorrow’s nest egg is created by a commitment to saving just a little bit each and every day.

When the audience was asked who would be starting on the path of saving and investing for the future, over 75% of the hands in the room went up. 

When investor education reaches the ears and eyes of teens, everybody wins.

Cindy  knows full well the difference credit unions are making in the classroom.  Every year she invites the credit union sponsored Credit University program into her classroom at Nathan Hale High School in Seattle.  Students in class learn how to avoid identity theft, use credit wisely, and save for the future the smart way:  In partnership with a credit union.

Yesterday, Kegley’s students learned how a lost cell phone without password protection can make their social and financial identities easily accessible to identity thieves.  They also learned the importance of shredding their junk mail, and being smarter about what they post on their profiles. 

In addition to avoiding identity theft, students learned how being a victim of this crime can impact their credit.  Understanding the importance of earning and maintaining a good credit score was also emphasized, and at the end of the day, students knew that when it comes to earning interest on their personal savings, it’s rare to find anyone willing to pay them more interest on their savings than a local credit union.

Schools interested in bringing Credit University to their classrooms can reach us at ach (at) aliciahaus (dot) com.

While answers varied from as high as a billion dollars to considerably less, most agreed that one million dollars would buy them a retirement that started around their 60s.  While the actual dollar amount varied, the answer is ultimately the same:  Retirement costs a heck of a lot, and these students knew it.

During the Washington Business Week business and free enterprise education program at White Pass High School this week, local business professionals and educators are teaming up to teach students the skills they will need both in their personal, and professional lives.  As part of the program, students had the opportunity to experience the Investor Education in Your Community program.

The investing basics presentation for teens asked students to look at retirement as something we all purchase for ourselves.  When you’re young, time is on your side and compounding interest will do the work for you.  You have the option to purchase that one million dollar retirement at a reduced rate of savings and let the compounding interest do most of the work for you. 

Wait until you’re in your 20s, and it costs much more.  Wait until you’re in your 30s, and you’ll have to save more than 10 times what it would cost you in your teens… and you still end up with one million dollars.

Students were invited to ask and answer the following question:  Do you want to pay more, or less, for the retirement you will someday purchase?   By the end of the presentation, many agreed that saving consistently for the future while young is not only smart, but it allows you to use more of your hard earned dollars for the things you care about while you’re young. 

These students are lucky to be led by a crack team of local business professionals and educators.  I had the pleasure of  meeting and presenting to this group of leaders later in the day.

Discussing the most common types of investment fraud and the resources and services that the WA State Dept of Financial Institutions offers to Washingtonians, these WBW advisors learned how to identify, avoid, and report the most common types of investment fraud.  Additionally, they learned about the role of the Investor Protection Trust and how unbiased, non-commercial resources are a must when it comes to safely and wisely investing.

Want investor education in your community?  Get in touch!  Investor Education in Your Community wants to hear from you!

‘My sister is getting a ton of magazines she didn’t order. Could someone have stolen her identity’?

The answer? Perhaps. Madeleine learned that her sister’s best course of action was to cancel the subscriptions and check her credit report. Those 18 and over can obtain their credit reports for free at www.annualcreditreport.com. Looking at her credit report will reveal if someone is using her personal information for more than just a prank.

Identity theft prevention, credit scores and how they work, and understanding how to get the best interest rate on their savings (pssst… it’s by banking with a Credit Union) are just some of the cool financial literacy morsels that Mr. Ley’s students got to snack on earlier this week.

If you’re looking for more information on identity theft, credit, and savings, check out these sweet resources.

Turns out they were the high school students.  These two, along with fellow DECA students, brought Mayor Lewis, the business community, and several government and not for profits together for an evening that asked participants to rethink money.

Mayor Lewis opened the event by discussing the importance of anticipating the financial pitfalls all of us eventually face, and the rewards of preparing for them.  He asked all of us to embrace the opportunity to prepare for our financial futures, and challenged today’s teens to be the difference that our economy needs when it comes to personal financial choices.

After Mayor Lewis spoke, the group broke into two sections.  One that stayed with me and experienced the Investor Education in Your Community presentation, and another that engaged in business role playing exercises with volunteers from the business, government, and not for profit sectors.  After 45 minutes, each group swapped places.

By night’s end, over 30 teens had learned about the power of compounding interest and how they can easily and inexpensively save for their financial futures by starting as teens.  Additionally, DECA students learned to rethink wealth from another perspective:  Dollars equal opportunities.  The more dollars we have, the more options we have in life.  The larger our savings account balance, the more ways we can impact our communities, either through taking time off from work and donating that time, or giving dollars to causes we care about.

Auburn High School DECA  students should be proud of their well-organized, informative, and fun event.