According to a phone
survey conducted by the American Institute of CPAs, 61 percent of parents
pay their children an allowance, averaging $65 per month. However, only 1 percent of parents said
their children save any of their allowance. Teaching children financial responsibility early can have a huge impact
on their financial habits as they become adults.
Along with another local CPA, I
spent several hours this summer volunteering with girls aged 13-15 discussing
topics such as balancing a checkbook, budgeting and saving, and credit
cards. We even talked about payroll
deductions and examined a W-4 and W-2. These are topics that are rarely mentioned in school.
Several of the girls had opened their own
checking accounts, and they had overheard their parents talk about credit
cards. However, many of them were
shocked to learn what is deducted from a paycheck. And, they had never really thought about
budgeting.
While I cannot say I kept them
fully engaged each hour, many of the girls asked relevant questions. Because the math skills varied among the
girls, we kept examples simple. We used
a financial calculator in Excel to show the impact of paying more than the
minimum payment on a credit card, which was surprising to girls who were paying
attention.
I hope to continue this volunteer
project in the future. I truly believe
the more children see good examples of financial responsibility, the more
confident they will be to take control of their financial future. In the meantime, I’m open to any ideas to
make W-2s and budgets more exciting to teenagers.
Jessica Miles, CPA
