Mortgages, insurance and retirement funds are not normal topics of conversation for teenagers, however, a group of Toll Gate students spent Tuesday morning discussing their financial future.
As the capstone to their participation in the CU4 Reality Financial Education Program, 100 students from Toll Gate High School were able to calculate exactly what they would be paying for everything from mortgages to clothing once they enter the real world.
The yearlong, elective program, sponsored by Wave Federal Credit Union, aims to teach sophomores, juniors and seniors career building and financial literacy. In addition to class work, representatives from Wave provide monthly presentations covering savings and checking accounts, financial planning, budgeting and more.
“It’s a great program,” said Superintendent Richard D’Agostino, who feels it guides students as they “make the transition to financial independence.”
The program culminates in the Toll Gate High School Annual Student Financial Literacy Fair, which took place for the second time Tuesday morning at the Radisson Hotel Providence Airport.
Wave President and CEO Paul Archambault, Mayor Scott Avedisian and General Treasurer Gina Raimondo were all present to talk about the importance of financial planning. Avedisian even declared March 26 to be Toll Gate High School Financial Literacy Day, presenting proclamations to the school and the credit union.
“You make me optimistic for the future,” said Raimondo, who encouraged the students to stop and think about the program’s lessons before making financial decisions in the future.
At the event, students were given a budget worksheet and required to visit all of the various booths to find the cost per month of various expenses, including rent, mortgage, car insurance, 401k deposits, groceries, clothing, utilities, pets and cell phones. Participating companies included Stop & Shop, Elmwood Dodge, Liberty Mutual, Best Buy and Petco.
Prior to the event, students researched desired career paths to determine what salary they would earn. Teacher Laurie Robinson had her students use Occupation Outlook, which provides a low, medium and high salary for each career. “I had students select the low level,” said Robinson, who also determined different life scenarios for the students, such as marriages or children.
“This is not a fun activity,” said D’Agostino, who described the event as “a wonderful exercise in reality.”
“This is not a game; it’s a learning experience.”
As in the real world, students had options when it came to their spending. Premier Homes Realty provided eight housing options from purchasing a $2.4 million home to renting an apartment with roommates. Items such as utilities and insurance were based on chosen living arrangements. Wave Credit Union provided the amounts of any additional banking needs such as mortgage approvals.
Stop & Shop presented four grocery budgets, which varied based on the number of meals students thought they would cook versus dine out. Studio West gave the average cost of haircuts and other salon services, while Empire Beauty School was on-hand to show the cost of their discounted services as a comparison.
At the event’s conclusion, students were required to calculate total monthly expenses and any remaining funds, factoring in any costs split between roommates. Some expenses surprised students, especially clothing, which was estimated to be up to $300 a month.
“It drops you in the real world,” Dan Josephson, a senior whose career was in construction management with an estimated salary of $55,000 a year before taxes. He was surprised by the cost of a mortgage and car insurance, but also by the cost of food.
“When you have food at home, you don’t think about it; it’s just there.”
Student Tom Martella learned firsthand the tricks of a car salesman. While at the Elmwood Dodge booth to learn about the cost of owning a car, Martella noticed that the representative was telling all of the students to purchase a brand new car as opposed to leasing or buying used.
“Seven hundred dollars a month on a new car; that is probably my highest cost,” said Martella, whose assigned occupation was a landscape architect. “It is higher than my student loans!”
Fellow student Evan Stamps saw the event as a great window into his future.
“It makes you see the potential [for your financial life],” said Stamps, who hopes to be a chiropractor.
Archambalt received positive feedback from students who completed the program last year, and expects the same this year. He believes the program provides a skill set students would otherwise be lacking.
“I don’t think they have the opportunity, with all of their curriculum work, to learn the day-to-day stuff,” said Archambalt.
School Committee member Gene Nadeau, who worked in banking for over 40 years, knows firsthand the importance of financial planning.
“They need to be prepared,” said Nadeau about today’s youth.
Raimondo sees programs aimed at teaching young people financial planning as more important than ever since we live in a world where “spending is just a click away.”
“It is important to teach people, especially young people, how to budget,” said Raimondo. “One mistake can ruin someone’s life; I want to help keep young people on track.
D’Agostino said the program is also at Winman Junior High School and hopes it will spread to all of the high schools soon. After witnessing the fair for the first time, Nadeau hopes to encourage the School Committee to look at making financial planning a required area of study.