Students learn about finance

Published 10:41 pm Thursday, August 12, 2010

Matthew Beauchamp may only be 14, but on Tuesday he was a married preschool teacher with no children, living in an apartment, had an after-tax, monthly income of $2,062 and was making decisions to forgo “luxuries” like cable television in order to put $640 a month into savings.

Matthew’s life was compliments of an exercise at King’s Fork High School’s second annual Financial Reality Fair for the nearly 200 incoming freshmen.

“We want to walk them through life and show them the importance of planning for future expenses,” said Melissa Boyce, business development representative for Bronco Federal Credit Union and co-founder of BreakThru! Consulting. “It’s important to start the conversations now instead of them getting to college and learning the hard way.”

Before the fair, students received “lives” that described their careers, their marital status, number of children and their education. Also included were their gross annual income, what they paid in federal and Social Security taxes and Medicare and their net monthly income.

After receiving their “lives,” they visited different tables to purchase items such as housing, insurance, entertainment, pets and clothing.

Sponsored by Bronco, the fair had employees from businesses such as QVC, Target, Suffolk Family YMCA and the Suffolk Center for the Cultural Arts, who represented the different expenses and helped advise the students.

For example, students visited the clothing expense table and talked to Ashley Greene of BreakThru! Consulting and Donna Raoust of Roust + Partners about what clothing they could afford and what they needed for their jobs.

While ideally the students were encouraged to save first and then secure items like housing, insurance and food, “we’ve had some kids stop here first,” said Suffolk Family YMCA representative Jennifer Hall, stationed at the vacation table.

“Others have had $900 left and came here before housing or food. You look at their budget and have to advise them that they can’t afford a vacation until they take care of some of the other necessities.”

“You really see that a lot of kids don’t have a concept for how much things cost and how to prioritize those expenses,” SCCA representative Kay Boone said. “It’s good for them to see that now.”

But there were also other students who made different decisions and could see the benefit of their budget-conscious decisions.

For example, Beauchamp began his purchases at the food table, where he realized with his salary he’d live off of Top Ramen.

“It really surprised me how much food and clothing cost,” Beauchamp said.

Then he paid his student loans, set up a minimalist clothing budget, rented his apartment, decided to forgo motorized transportation because he lives next to his work place, got health insurance, a second part-time job when he’s off during the summer and put the rest into savings.

Comparing lives and expense decisions, “students realized that you can make $30,000 or $100,000,” teacher Leigh Anne Parks said. “It’s the decisions they made that really impacted their quality of life. I think it was eye opening for students.”