Orange Mound

Melrose High School students make tough calls at financial education simulator

During the course of one’s education, disciplines like mathematics, language arts and science are vigorously stressed. Unfortunately, with the three-headed approach to curriculum, other disciplines receive short shrift, such as like financial literacy.

In the past, schools would only brush on the subject. A rudimentary math class or home economics may include a lesson or two on balancing a checkbook.

To help better prepare local students for financial independence in the future, RISE in partnership with SunTrust Bank launched their first “On My Own” event, held at Melrose High School on February 22. “On My Own” is an interactive financial simulator to give youth insights into personal financial literacy. It was developed by Bank On Memphis and the Family and Consumer Sciences department of The University of Tennessee Extension. 

“It is a simulation to help students see what it’s really like to take care of a family in different scenarios. I think that is one of the key things for them to learn,” said Linda Williams, CEO and president of the RISE Foundation.

Related: "Unbanked: The high cost of doing business in ZIP 38126"

"Own My Own" has been offered in schools across the state and has reached over 30,000 students each year. This is the first time RISE and SunTrust have facilitated the program. Melrose High has a previous relationship with RISE and SunTrust through their goal card program, which is a points-based system that sets goals for students. They can earn prizes or bank their points for a bigger reward.

“In our goal card program, we have integrated financial literacy in the work we are doing with young people in an effort to help them graduate from high school to be ready for post-secondary education or other types of skills training that will allow them to be employed in jobs that will help them take care of themselves as well as their families,” said Williams.

For the event, Melrose’s goal card students were given life scenarios such as simulating a single mother or a father with two children. They were also given professions and accompanying wages. They were then tasked with managing a monthly budget, including food, housing, transportation, childcare and other expenses.

Once they see what their take-home pay would be they move around to different stations that represent typical expenses and make decisions on how they spend their money.

“It was interesting to watch them. Some of the young men said I really need a wife that works and not a stay-at-home mom. But when they looked at the cost of childcare, they realized it may be better to have a parent stay at home. They really have to make real-world situations,” said Williams.

The partners also stressed the importance of savings. Students were required to sock away $25. It is to encourage the teens to become lifelong savers, regardless of the amount set aside. Students were also given check registers to keep up with expenditures.

“We’re in a day where everybody uses debit cards and EBT cards but you still have to learn to write it down and keep up with what you spend so you can balance everything at the end of the month,” said Williams.

The simulation also included typical payroll deductions, like FICA tax.

“We discussed with them what FICA is and as well as the other holdings you can expect once you are employed. Then they would see once you make all those deductions from your gross pay, what you really get to take home is not as much as it would appear,” said Williams.

Around 25 SunTrust volunteers manned the stations. They guided students’ decisions based on what they could afford such as a house note or a rental apartment. They also threw financial curveballs at them like an insurance co-pay at an emergency room.

Johnny Moore, president and CEO of SunTrust Memphis and Melrose High School alum, served as the keynote speaker for the event.

“You always get goosebumps going back to an institution that’s been so important to your life. It was important to be in front of those kids to let them know it’s a big world out there beyond the Orange Mound community," he said.

"Don’t let this community alone be the box you live in. Expand your horizons. Push yourself to be better. Dream hard but dreams are just dreams unless you put some action to them. Learn how to act on those dreams to make them a reality."

The executive helped students draw connections between their studies in and their future employment. He pointed out that English, and particular writing, is as critical to a career in finance as mathematics. Moore also explained the importance of a checking account and understanding a basic budget.

“I said to the RISE kids, ‘How many of you guys walk down the street and just throw a 20 dollar bill on the street on purpose’ and they said ‘We wouldn’t do that on purpose.’ I pointed that’s exactly what they do if they don’t have a checking account and pay somebody 10 percent to cash your check. This is an unnecessary expense,” said Moore.

Williams was pleased with the outcome. The simulation helped young people think about their decisions and follow their best interests.

“Kids need to have people they can aspire to and he was able to talk to them about the different schools he attended. They were amazed to see someone who went to the same school they did who made it as a CEO of a major bank,” said Williams.

Williams was pleased with the outcome. The simulation helped young people think about their decisions and follow their best interests.

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