Teen Financial Literacy



The Wall Street Journal- By EMILY GLAZER

Is 2013 the year you're finally going to start your teen on that long road to financial independence?

There are plenty of books, blogs and videos out there with a dizzying array of financial advice and investing how-tos. The problem is that                           most are geared toward adults, who themselves can find the material too dry.

So we asked some personal-finance experts and advisers to recommend a few reads (most available both in print and as e-books) and videos—this is the YouTube generation, after all—that can help get teens interested in personal finance. 

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Over the past several decades, Americans 25--34 years old experienced significant declines in net worth while increasing their debt. For every dollar worth of assets owned, this group carries 70 cents worth of debt.

The Feed the Pig campaign aims to reverse this trend by empowering younger Americans to take charge of their personal finances by living within their means and saving for long-term financial security.

Statistics demonstrate that this group's financial behaviors, while less established, tend toward debt accumulation, and this is happening during a period of milestone events such as getting married, having children and caring for aging parents. But there is hope: more working time before retirement means that their current financial decisions have a greater impact (positive or negative) on their long-term financial security.

Scroll to the bottom to view three "Feed the Pig" videos and log on to their website.

"The Motley Fool Investment Guide for Teens," by David and Tom Gardner

Amazon: The Motley Fool Investment Guide for Teens

This book teaches teens about investing by offering tips on how to build a portfolio of stocks and emphasizing the importance of long-term investing. The book uses lighthearted language to discuss learning how to earn money and the importance of savings so you can begin investing. Then it teaches the basics of the financial system, like banks, credit unions and insurance.

"It makes complex topics around investing simple," says Jack Kosakowski, president and CEO of Junior Achievement USA, a nonprofit in Colorado Springs, Colo., that educates students about the economy.

"The Wealthy Barber," by David Chilton

Amazon: The Wealthy Barber

Around since the late 1980s, this book has lessons on long-term financial planning that still hold true.

It focuses on three young adults who realize they don't know how to create a financial plan for their futures. A parent points them to the local barber, who turned a low-wage job into a comfortable lifestyle. They meet with him monthly and have discussions on topics including saving, wills, life insurance, retirement and taxes.

"It's not a professor, not an economics class, it's homespun wisdom," says Eleanor Blayney, consumer advocate for the Certified Financial Planner Board of Standards in Washington, D.C.

"The Ultimate Gift," by Jim Stovall

Amazon: The Ultimate Gift

It's the story of a young adult whose wealthy great uncle dies. The uncle believed his wealth corrupted most of his family so he instructed his attorney to save his youngest relative by doling out the inheritance only if he understands 12 essential "gifts."

For instance, the gift of work emphasizes the significance of a good work ethic, which is especially important for a teen to grasp, says Timothy Maurer, a financial planner in Baltimore who also teaches personal finance at Towson University.

"The Millionaire Next Door," by Thomas J. Stanley and William D. Danko

Amazon: The Millionaire Next Door

Many teens assume that millionaires are just athletes, celebrities and Wall Street executives. This book highlights the typical millionaire, who is smart enough to spend less than he or she earns and consistently puts money aside.

"It's the plumber, it's the nurse, it's the teacher," says Ken Weingarten, a certified financial planner in Lawrenceville, N.J.

The book teaches the lesson of slowly accumulating money, living within means and then maxing out retirement savings plans, like 401(k)s and individual retirement accounts.

"Life After School Explained," by Jesse Vickey, Andy Ferguson and Nicole Vickey

Amazon: Life After School Explained

Using feedback from recent college graduates and students, this book focuses on basic financial literacy, featuring topics including student loans and the difference between buying and leasing a car, Mr. Kosakowski says. The book uses humorous and easy-to-digest pros and cons to help teens understand some of the big financial decisions that will spring up as they get older.

Mint.com blog

Mint.com Blog

Amazon: Mint.com in 10 Minutes

OK. So your teen is repelled by the idea of reading a book. The blog on personal-finance site Mint.com offers a bevy of information on topics such as common money mistakes and budgeting goals, says Kimberly Foss, a certified financial planner in Roseville, Calif. The blog, though not specifically geared toward teens, is written in a colloquial and fun tone, using real-life examples like holiday gift shopping, that appeal to a younger audience, Ms. Foss says.

Feedthepig.org videos (Our favorite!)  
Feed The Pig


Feedthepig.org is the personal-finance site for teens run by the American Institute of Certified Public Accountants. It features fun, short YouTube videos on topics such as saving. Ms. Foss says one 30-second spot, called "Royal Family," taught her daughter that eating out often can cost thousands of dollars annually. She later decided to bypass a $9 salad for dinner and eat at home.

VIDEO'S WE LIKE


YouTube Video


YouTube Video



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