Family Checkbook | Changing financial education to match today's realities

Family Checkbook | Changing financial education to match today's realities

By KATHY SWEEDLER

After over 20 years of teaching personal financial management, I am still looking for more ways to empower people to use money to reach their goals and dreams. As our economy, societal practices and laws change, our approaches to financial management education need to change too.

In the past two weeks, our Extension office has presented "Welcome to the Real World," a financial career simulation, to over 225 students from six different schools, with the help of over 35 volunteers. (Thank you, volunteers!) This program has been around awhile, and it continues to evolve with the times. Students still write a few checks for their purchases, but we also teach about using debit cards and automatic withdrawals. I can imagine a day where we won't be teaching check writing anymore.

Our Money Mentors Book Club is currently reading "The Financial Diaries: How American Families Cope in a World of Uncertainty," by Jonathan Morduch and Rachel Schneider. "Financial Diaries" describes a research study that collected detailed financial data from 235 low- and moderate-income households over the course of a year. The book focuses on the volatility of people's incomes and the variability in monthly expenses.

For example, for more than five months a year, the average family's income was 25 percent above or below their median income. Wow! This has significant implications for how I teach money management skills related to budgeting and saving.

One of my favorite financial management strategies that I share with people is the usefulness of tracking their monthly expenses to see where their money is really going. This strategy also allows people to see if their spending aligns with what's important to them. I've been working under the assumption that most of the time their expenses are relatively consistent month to month; now I need to rethink that. Tracking expenses is still a good strategy; however, people may need to track expenses for longer to understand them.

While reading this book, I realized that I don't emphasize tracking income month to month. I am changing my teaching strategy on this now. Clearly, we need to have good data about our income flow as well as our expenses to develop a working spending plan.

University of Illinois Extension's Money Mentor volunteers depend on research-based information like this to work with people who ask for help developing financial goals and action steps to reach their goals. Mentor volunteers helped 145 community members in 2017 on topics such as budgeting, decreasing debt and increasing savings.

Although we had 37 new mentors join the volunteer program in the last year, the demand for their services is high. We are continuously running a waiting list of people who would like to be matched with a mentor.

In May, we will begin another Money Mentor training session with the financial support of United Way of Champaign County. Mentors complete 30 hours of training that includes financial education and coaching skills.

To learn more about the program and to become a mentor volunteer, please visit our website at go.illinois.edu/MoneyMentors or call 217-333-7672. We are seeking mentors in Champaign, Ford, Iroquois and Vermilion counties.

Also upcoming this spring is Money Smart Week, when communities throughout the nation will highlight financial education opportunities.

Mark your calendars for April 21-28. Many events are planned in both Vermilion and Champaign counties and soon will be listed on the online calendar at moneysmartweek.org.

Topics I know about so far include student loan repayment (Champaign Public Library), dealing with data breaches (Danville Public Library) and taking control of spending (Habitat for Humanity of Champaign County).

Watch for more events and learning opportunities as we move into April!

Kathy Sweedler is a consumer economics educator at the University of Illinois Extension. Contact her at 217-333-7672 or email sweedler@illinois.edu.

Sections (1):Living
Topics (2):Economy, People
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