Few teenagers are money management experts by the time they graduate high school. Most of them are lucky; they have the social and financial support of their families when they make a financial misstep. Youth aging out of the foster care system aren’t as fortunate. Without permanent social connections and the financial backing of a family, the consequences of poor money management can hurt them throughout their adulthood.
Many States and organizations have recognized the need for greater financial education and asset building among youth in foster care systems. The issue is especially critical among youth within Independent Living Programs, which often serve youth from age 16–21 who will soon age out of the foster care system. On September 13, Children’s Bureau regional staff, State Independent Living coordinators and providers, AFI grantees, and youth representatives from Region 3 met to discuss ways in which they can coordinate their efforts to best provide financial education and asset-building services to youth in Independent Living Programs.
While the AFI Program, Children’s Bureau, and Independent Living Programs have all made an effort to better prepare youth in the foster care system for financial self-sufficiency, the programs have yet to coordinate on a regional scale. The goal of the “The Asset Building for Youth Transitioning from Foster Care to Independence Summit” was to start a conversation between organizations in Region 3 that can lead to statewide coordination among different stakeholders in the foster care and asset-building communities.
AFI grantees from Region 3 represented the asset-building community during the summit. Representatives from the Capitol Area Asset Builders (DC); First State Community Loan Fund (DE); Community Action of Howard County (MD); New York City Administration for Children’s Services (NY); CORE Scholars (PA); Philadelphia Department of Human Services (PA); United Way of Southeastern Pennsylvania (PA); Total Action Against Poverty (VA); and KISRA (WV) attended the meeting.
Youth representatives from foster cares systems in Delaware, Pennsylvania, Maryland, and Washington, DC, attended the meeting and provided valuable feedback on financial education and asset building from a youth perspective. Each youth representative sat on a panel that answered questions from the facilitators and meeting participants. The panel explained that most kids their age don’t know how important financial literacy is, and that the complexity involved in managing money, opening a bank account, and responsibly using a credit card was intimidating. Most of the youth reported difficulty opening bank accounts if they were under 18. While all of the youth understood that managing their money was important, some admitted to having difficulty balancing their wants and needs.
Despite facing challenges with money management, the youth representatives had plenty of valuable advice for the organizations and people working to bring asset-building services to them. Some on the panel felt that teenagers were highly unlikely to save their money, even when they know they should, and thus thought that Independent Living Programs should insist that kids to save their money. Others felt that making saving money less intimidating by starting with small amounts monthly would be effective. One young man thought that group homes should teach teens to budget the money they’re given instead of just giving them an allowance, which would help them learn money management skills while they still had the safety net of their Independent Living Programs.
Throughout the youth panel discussion, many of the representatives emphasized that one of the most important factors in their path to becoming financially self-sufficient was maintaining stable, lifelong relationships. Many of the youth representatives talked about the stability that lifelong relationships provide in their lives, and said that stability spreads into other areas of their lives and gives them confidence, optimism, and guidance to responsibly manage their finances.
A panel of State Independent Living Coordinators took the feedback from the youth panel discussion and talked about the need to create experiential learning programs, which would give teenagers in Independent Living Programs the opportunity to practice money management and savings skills before they transitioned out of the foster care system.
After the morning of panel discussions, Deborah Brooks gave a presentation on the AFI-funded Youth Financial Empowerment Program run through the New York City Administration for Children’s services. The program, which uses AFI funding for certain components, uses financial education, IDAs, a savings program, and intensive case management and supports to help youth aging out of New York City’s foster care system become financially self-sufficient. Read more about the Youth Financial Empowerment Program, featured in a previous AFI newsletter article.
Julie Miller of the Delaware Center for Justice gave a presentation on the Jim Casey Youth Opportunities Initiative of St. Louis, MO, which works with communities across the country to implement a broad set of strategies that help young adults leaving the foster care system to become successful and productive adults. Learn more about the Youth Opportunities Initiative.
At the end of the meeting, each State met for a planning session and set goals for improving the delivery of financial education and asset-building services to youth in the foster care system and Independent Living Programs. Work will be conducted with representatives in each State to help provide resources so that States may work toward their identified goals.
This article originally ran in the IDAresources.org Update Newsletter on 09/29/11 and is available for archival purposes.