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Economics Crash Course: Teens Learn College Education Doesn't Come Cheap
For Immediate Release:
ECONOMICS CRASH COURSE: TEENS LEARN COLLEGE EDUCATION DOESN'T COME CHEAP
Junior Achievement-The Allstate Foundation Poll Shows Urgent Need for Financial Planning for Young Adults and Family Financial Conversations
Colorado Springs, Colo. – A new study from Junior Achievement and The Allstate Foundation reveals that teens are feeling the fallout from the recession in a number of ways. Two-thirds of teens are changing their college plans due to the recession: half are working more to pay for college and 42% now plan to attend college close to home.
Also, compared to 2010, more teens are working to pay for college (an increase of 9%) and planning to stay closer to home for school or not go to an out-of-state college (an increase of 5%). And nearly half of teens surveyed report that they are more concerned about the economy than last year and 63 percent say their families are spending less due to the recession.
"Teens face many tough decisions in their lives. Two of the biggest are where to go to college and more importantly, can they afford the high costs that come with it," said Matt Winter, president and CEO, Allstate Financial. "In today's global economy, getting a financial head-start can lead to big pay-offs in the future. That's why educating kids about money management is so important to us and to the financial health of our country."
Optimism among Teens Despite Less Financial Support
According to the U.S. Bureau of Labor Statistics, the number of families with at least one unemployed member has nearly doubled from 6.3 percent in 2007, to 12.4 percent in 2010. "Previous generations of youth have had the luxury of relying on their parents for not only emotional support, but also financial support as they go through college and enter adulthood," said Jack E. Kosakowski, president and chief executive officer of Junior Achievement USA™. "Now, with many families' financial situations in limbo, this support is strained. It's more important than ever to empower teens to own their economic success, and Junior Achievement can help them along that path."
College students often count on their parents to financially assist them while in school. And many young adults even rely on their parents as they enter the workforce, whether that entails help with car payments and cell phone bills, or moving back home to save money on rent. However, the recession has altered many parents' abilities to assist their children as they transition to adulthood, which has left teens worried about their options.
Even with these financial set-backs, an astounding 89 percent of teen respondents said they'll be as financially well-off as their parents. However, only three-quarters of teens think they are currently budgeting their money successfully, and a mere 39 percent think they are effectively using credit cards.
Family Financial Discussions and a Gender Gap
Managing debt and saving is the basis of fiscal health, and teens need to be given the tools and experiences early on to build a solid foundation in basic money management to kick-start their future financial success.
To help parents open up a dialogue with their children about fiscal responsibility, Junior Achievement, in partnership with The Allstate Foundation, has created new, free, interactive online lessons for all age groups, which complement existing classroom lessons. Here, elementary-aged students will learn about financial decisions based on spending and savings, middle school students apply their knowledge of income to make various purchasing decisions using credit, and high school students learn more about long-term financial decisions such as paying for college or buying a car. By providing young adults with the tools they need to make smart financial decisions, Junior Achievement assists them with achieving their own personal success.
This is the twelfth year that Junior Achievement has conducted its "Teens and Personal Finance" survey. For a summary of the results, visit www.ja.org.
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