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Balancing act

By Lori Lindner
North Liberty Leader
CORALVILLE– Jared Kiebel really wanted the Escalade, but he couldn’t make his budget stretch far enough.
“It costs a lot of money,” Kiebel said. “Eight hundred and sixteen dollars a month. And that’s without the gas.”
Kiebel’s observation might seem common sense for someone who has worked for a living, paid monthly bills and made car payments.
For a middle school student, though, it’s more like a revelation, the discovery that one’s spending ability really does depend on income.
“It’s a big decision, to know the difference between what you really need and what you just want,” Kiebel concluded.
And that insight is one thing the organizers of the annual Financial Literacy Fair hope all students will gain from the experience.
This year’s Financial Literacy Fair took place March 6 at the Coralville Public Library, sponsored by the Workplace Learning Connection (WLC) and the University of Iowa Community Credit Union (UICCU), in collaboration with middle schools across the region. The fair is the culmination of each school’s financial literacy unit, part of Iowa’s mandatory core curriculum for middle school students, that teaches them how to balance a checkbook, manage a budget and create personal savings. Students conduct career explorations to discover what types of occupations are available based on their skills and interests, how much they will spend on education to reach a particular career goal, what average compensations are for the jobs they eventually choose, and learn how to calculate payroll taxes to arrive at a monthly take-home pay.
Instead of bringing home the bacon, students take their monthly income figures to the Financial Literacy Fair, where they are presented with budget sheets and asked to visit a number of stations. Volunteers versed in various expenditures are on hand as students learn what it takes to pay a mortgage or rent, buy insurance, pay the utility bills, afford daily transportation and keep groceries on the table, as well as pay back those student loans and finally set some cash aside for a rainy day.
After creating a budget within their means, the students meet one-on-one with a financial advisor– employees from the UICCU– to evaluate their financial decision making.
But just like real life, one particular stop at the Financial Literacy Fair can throw in a curve ball.
Before meeting with the financial counselors, students were asked to spin the Wheel of Reality, where chance offers up healthy doses of car repairs, job layoffs or medical bills, unforeseen expenses that can crunch even a well-crafted budget.
“It’s not easy making a living,” said North Central Jr. High (NCJH) student Nick Kertels, who chose veterinarian as his profession. “All the stuff you need, and student loans, added up to a lot. It gives me a better perspective on what my parents spend.”
Unlike his friend Jared Kiebel, Kertels said he picked a cheap car with better gas mileage.
UICCU Public Relations Director Jean Knepper said the goal, of course, is to end up in the black.
“The financial advisers help them look over the budget choices they have made, and determine if they were sound,” said Knepper. “Then they make suggestions as to what they might do differently.”
Knepper said UICCU sponsors fairs in the Iowa City area, which included Solon schools, as well as Cedar Rapids, Vinton, Washington and Marion. Five other area credit unions also sponsor financial literacy fairs in other areas. The first fair was held in 2009, with about 450 students participating. This year, the fair’s fourth, will involve more than 3,300 students from middle schools in four counties.
“We feel we are reaching out to the community to help kids understand financial decision making,” said Knepper. “As a credit union, it is a natural step for us to take a leadership role in educating children in financial literacy. We do a pre- and a post-survey, and we do see a difference in what they have learned in between.”
NCJH eighth grader Michaela Hancock said she wants to be an attorney. That career path gave her an average income of about $6,000 a month to work with, but Hancock said she still made frugal choices.
“I especially was careful at the food and clothing booths, where you have to decide between not going out at all and going all out. This helps, because you see how it all adds up, and you learn the give-and-take of what you spend on needs, and what you spend on ‘wants,’ like vacations. It shows it’s good to have a car that gets good gas mileage.”
What’s more, said Hancock, “It was a lot of fun.”