Miss Minnesota Contestant Raises Financial Awareness: The Queen of a Thousand Smackers

Cash. Coin. Coconuts. No matter what you call it, people are talking about it. Or are they?

My husband, Jason, and I often discuss the strange fact that we don’t learn about managing money in school. And yet, it’s vital to existing responsibly and independently even before we graduate into the “real world.”

The Facts:

• The number of credit card offers given to high school and college students has increased in relation to the weak economy
• Students as young as 15 or 16 years old can obtain credit cards
• Credit card companies are encouraging young students to “start building their credit early” without being mindful of the education teens need prior to using a credit card responsibly
• A 2001 study by Nellie Mae, a loan provider for college students, found that 83% of undergrads have at least one card and the average balance was $2,327.
• Students having balances of over $3000 rose to 21%, a 61% increase since 2000.
• College students will double their credit card debt and triple the number of cards they have between the time they set foot on the college quad at orientation and the time they leave after graduation.
• When quizzed about paying taxes, using credit cards and retirement savings, year after year, 12^th graders have received a failing grade.

One of my roommates after college was so far in debt she became reliant on others to cosign on loans, verify that rent would indeed be paid, and pay for anything that required a credit card—since she no longer had one. Isn’t anyone teaching money management?

Turns out, some people are making it their mission.

Meet beauty queen, Kelsey Malecha. You usually hear pageant queens using their platform to educate others about cancer research, children with disabilities, reading programs, and self esteem for teens. But financial literacy? That’s a new one.

Kelsey Malecha says told her local paper that her mission in life is to teach others about how to save and spend money wisely.

How did she wind up on such a path?

The Good:

I wanted something that would relate to everyone and I thought about it for a long time and realized, well, I came from a household where I got an individual retirement account (IRA) as a graduation present from high school. I didn’t get a car like some of my friends; I got an envelope with an IRA stub in it.

The Bad:

While I was in college I incurred some credit card debt, which snuck up on me like it does for a lot of people. It was a very stressful situation, because I’d wake up every day and go to work — and I realized I’m not going to work to get spending money like my friends, I’m going to work to pay off my credit card debt.

The Ugly:

I had about $5,000 (of credit card debt). It was keeping up with the Joneses. I think the first purchase that started to rack up on it was my first iPod Nano. I had to get it the minute it came out. I saw that a lot. When I worked at Best Buy, I’d see people buying Nanos and buying cell phones who had poor credit. … We are a materialistic society and we do make emotional spending decisions just to feel good. I’d see people coming into Best Buy and they’d say, “I need some retail therapy.”

After getting honest with herself and paying off her debt, she got serious about teaching young people to be more careful with money. She has presented to children as young as 1^st grade up through high school. Her frustration lies with the fact that schools don’t seem to teach financial literacy.

Kids love money, they love talking about money. … I’m surprised we don’t have more classes in schools about how to handle money. And it’s such an important life skill — being able to manage your finances — that I wish it were a graduation requirement.

Getting a Powerful Jump on things:

Since money management is such an important skill, we’re inviting Sam Renick, speaker and author of children’s book, It’s a Habit, Sammy Rabbit! to the Powerful Parent Blog to tell us about how to help our children save and use money wisely. He’ll be with us later this week! Interestingly, his book is one that Kelsey Malecha uses to educate students about financial literacy.

Money Management is part of learning responsibility, self control, discipline, and goal-setting. These are indeed Powerful Words. Those who save and spend wisely can focus on what they want out of life rather than how they’re going to pay back what they owe. We owe it to our children to teach them the way.