Financial Management Systems & Support – Established as Kids

Youth are entering the world unprepared, lacking the financial systems and support they need to be successful in their early financial situations. They often lack savings, checking, and retirement accounts with systems in place to manage these accounts. Combined with limited availability of professionals to help youth make better-qualified decisions, many youth get off on the wrong financial foot, which can plague them through adulthood.

Because of the severe consequences of making financial mistakes, care must be taken to ensure that youth leave home prepared. Simple credit mistakes can haunt them for seven years, early debt can follow them for decades, those who lack insurance are at higher risk for major problems, and failure to save money early can cost them for the rest of their lives.

Research, Statistics & Quotes

Approximately 9 million (7.7%) American households did not have checking or savings accounts and over 20 million (17.9%) were underbanked. Households headed by 15- to 24 year-olds were almost twice as likely to be unbanked.

Federal Deposit Insurance Corporation’s National Survey of Banked and Unbanked Households

Forty-eight percent of all Americans aged 18 to 30 have zero in retirement savings and no access to a traditional pension.

USA Today

66% of millennials have nothing saved for retirement.

CNN

NFEC Position Statement

Having the right accounts, management systems, and professionals to turn to for guidance can go a long way toward helping people get off on the right financial foot. All these factors can be established and in place long before young people move out on their own, and automated to give youth a better chance at success.

To support young adults entering financial independence for the first time, the NFEC provides project-based learning programs that guide participants to establish their financial foundations. This financial foundation includes opening accounts, automating bill payments, researching insurance coverage, setting up a calendar of tasks, and gaining access to mentors who support their efforts. Our goal is to have them build their personal financial foundations while still in the security of their homes, to reduce the potential for mistakes when they move out. Toward reaching this goal, we deeply value the financial education champions who partner with us to spread such foundation establishment broadly among today’s youth.