Heard Off the Street: A financial planning lesson for youngsters

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Pretty soon, some area high school students will have something their parents lack: a financial plan.

Junior Achievement and the CFA Society of Pittsburgh are teaming up with the co-author of a book on financial literacy and two local universities to offer high school students a course on how to manage their finances.

The course, based on a five-class course JA already uses, will be taught either by a high school teacher or a volunteer from the CFA Society. As part of it, students will prepare a five-year financial plan that will include information on possible career choices, what kind of education they will need and how much they can expect to pay -- and borrow -- for school, as well as what to do about credit cards and other forms of debt.

The financial plans will be critiqued by business school students from the University of Pittsburgh and Duquesne University.

"If you're a principal or high school teacher, you're hard pressed to think of a subject that impacts 100 percent of your students, but this one does. One hundred percent of them make choices about money," said Gene Natali Jr. of C.S. McKee, a Downtown investment firm.

Mr. Natali and his high school friend, Matt Kabala, co-authored "The Missing Semester," a short, breezy primer on financial planning that will be required reading for the course. Mr. Natali has spoken on the topic at several local high schools and colleges since the book was published in 2012. Junior Achievement and the CFA group run educational programs for high school students and contacted Mr. Natali about teaming up.

"One of the things that is not getting taught in schools is basic investment, basic financial literacy," said Chris Pretsch, a portfolio manager with Downtown investment advisor Staley Capital and head of the CFA Society's education program. (The society's members are certified financial analysts.)

Mr. Pretsch said any time he has spoken to high school students, they are enthusiastic about learning how to manage their money wisely. It's a view shared by Mr. Natali, who has found that some students are upset that they haven't been taught about it.

"The enthusiasm students show for this subject, once they're made aware of its importance, is off the charts," Mr. Natali said.

If you doubt the magnitude of financial literacy challenge, consider the fact that more than 70 percent of Americans live paycheck to paycheck, according to a survey taken by Bankrate.com this year. Not only do they lack savings, they do not have the knowledge to make wise financial decisions.

The Consumer Financial Protection Bureau recently said the nation spends $670 million a year, or about $2 per person, on financial education. When consumers make money decisions, all many of them have to rely on is a bewildering blitz of advertising from financial services firms, who spend about $17 billion annually, or about $54 per person, on advertising and other forms of marketing, according to the federal agency.

"We have to have citizens who make smart financial decisions," said Patsy Kvortek, a business educator at Riverview Junior and Senior High School.

Ms. Kvortek will add the new program to her classroom this spring. She teaches several business-related courses, including personal finance. She said her students' parents often ask: "May I please sit in your class for some sessions?"

Junior Achievement, which runs programs on financial literacy, work readiness and entrepreneurship, will administer the initiative. CEO Dennis Gilfoyle said the organization made appearances at 418 schools last year and the most requested program was the one on financial literacy.

"My thought is the schools are going to be calling us up and requesting this program," Mr. Gilfoyle said.

Mr. Natali said the program will target high school juniors and seniors, hopefully reaching them before they make their decision on what college to attend. Many students do not appreciate the financial impact that decision can have. The average 2012 college graduate left school with debt of $29,400, according to the Institute for College Access and Success.

"It's a burden that can last a lifetime and, when you're 18, you don't necessarily realize that," Mr. Natali said.

University of Pittsburgh finance professor Jay Sukits will give his students extra credit for critiquing the high school students' financial plans. He requires students in some of his classes to develop one-, three- and five-year financial plans and he bases 10 to 15 percent of their grade on the document.

"It's more of an eye opener. It really gets them to focus on their financial situation," Mr. Sukits said. "We're trying to focus on getting some of this experienced-based learning pushed down to the high school level."

One of the challenges that organizers will face is that standardized testing requirements and other factors make many high school teachers feel like there's not enough hours in the day to do their jobs. But Ms. Kvortek believes more educators are coming around to her point of view.

"I have a passion for giving students what they need to survive outside the walls of the school. I feel personal finance provides that," she said.

Teachers interested in the program should contact JA by phone, 412-208-4747, or through its website, jawesternpa.org.

Len Boselovic: lboselovic@post-gazette.com or 412-263-1941.

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