As Whitney Houston once sang, “I believe the children are our future. Teach them well and let them lead the way.” If children are the future of the financial industry, now is as good a time as any to teach them fiscal responsibility. After all they will be the future bankers, traders, and policy-makers. Teaching them to save is a vital lesson to help secure the health and future of the nation.
For these reasons, the American Bankers Association (ABA) created the Teach Children to Save (TCTS) program and utilized 12,000 bankers on April 21, 2009 National Teach Children to Save Day to get the message across. Since the program’s inception in 1997, the ABA has seen over 60,000 bankers go out and reach 2.8 million children to teach them about savings through ABA specially developed resource kit. The kit contains 20 lesson plans that are age appropriate so that financial education does not have to limited to just one particular age group. The lessons include personal finance topics, including: budgeting, saving, making money grow and examining the difference between “needs” and “wants.”
This year, the ABA has set a goal for financial institutions called the Million Child Challenge, inspiring banks to not limit themselves to just Teach Children to Save Day, but to give a TCTS lesson anytime in 2009 to help them reach their goal of one million children that have been taught fiscal responsibility. On April 21 alone, fiscal lessons where given to 417,475 children.
Why such a need for savings? The program was sparked from the need for a fiscally responsible nation. According to the Pew Research Center, a survey of 2,413 adults in early 2008, found three out of four Americans say that they aren’t saving enough. The fact is that Americans save less than one percent of their incomes and have saved less in the past two decades. But this doesn’t just affect the middle and lower class that are feeling the crunch of the slowed economy, 70 percent of people that are self-identified as upper or upper-middle class said that they too aren’t saving enough.
Children tend to get interested in savings from their parents, so parents need to set the example for their children. Because of low savings among the nation’s parents, it’s no surprise that a 2008 Jump$tart Coalition survey of basic personal finance found that high school seniors were able to answer only 48.3 percent of the questions correctly. It is no surprise that the scores were so low when a survey by Charles Schwab Teen and Money in 2007 revealed that nearly a quarter of teens feel savings is unimportant because of their age.
According to Chairman and CEO Harris Simmons of Zions Bank, Utah’s oldest financial institution, consumers have gotten into the trouble of not saving enough because they “confuse needs with wants and get in over their heads.” A slow economy is the perfect way to take advantage of “teachable moments” because the information seems more pertinent to children, especially those whose families are feeling the pressure of the economic crisis.
Zions Bank, has been participating in the Teach Children to Save program since its inception. They believe that educating children today means smarter consumers and bank customers tomorrow. Many of their efforts have been nationally recognized. They received the 2008 Excellence in Financial Literacy Education Award from the Institute for Financial Literacy. On National Teach Children to Save Day, they had 180 bankers participate at local schools reaching grades K-12. Bankers were encouraged to be creative and use their own activities in addition to the ABA’s lesson plans. Mr. Simmons visited seventh- and eighth-grade students at Bryant Middle School, located in Salt Lake City, where he illustrated the power of watching savings grow through compound interest and how they can save for things that they may enjoy in the future by not frivolously spending their money on snacks and DVDs. Younger children can also be taught the power of savings, which is why Zions Bank President and CEO Scott Anderson and Executive Vice President Rob Brough taught fifth- and sixth-graders at Woods Cross Elementary school the differences between “needs” and “wants” in an effort to help them become lifelong savers.
Besides being an excellent program to get kids comfortable with savings, it’s an excellent opportunity to introduce children to bankers and to saving in hopes that they themselves will become savers. Zions Bank reached out to 9,500 students on National Teach Children to Save Day. After each school visit, they then see children coming in to the branches to open their own savings accounts. Part of making children more comfortable with banking at a young age is to treat them as customers, which is why Zions Bank provides employee training so that new account representatives know how to speak to their young clients, paying attention to them and helping them understand how savings can grow, rather than just speaking to the parents, which can make kids feel left out. Additionally, their children’s savings products are made to be fun for kids. They offer a Kids green savings account product that targets young savers and educates them about how to manage their account with a fun, colorful passbook and stickers.
Teaching children that saving is a vital part of their future is something that any financial institution can do. This is an important enough topic that it should be an on-going effort throughout the year. Beginning with one lesson is an excellent way to get involved in the community and to get future customers to start a kid-friendly savings account with a bank.
There are several easy ways to get started. If a bank has a school that they are already in touch with and doing community outreach with, they can approach the principal about bringing in a team of bankers to talk about easy ways to save. If no connection is currently established, talking to your children’s teachers about how you can help teach savings to the class is usually welcomed and the program can grow from that one opportunity.
