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By Betty Lin-Fisher,Beacon
Journal business writer
I was shocked and a bit troubled by a recent Junior Achievement
poll that showed 22 percent of Akron-area teens have credit cards.
After all, these are students who are still in
high school.
Given that credit card debt among adults is a constant
problem in our nation, it seems a little precarious for students
so young to have credit cards.
As of February, Americans have more than $754 billion
in credit card debt, according to the Federal Reserve.
It's bad enough that college students are bombarded
with offers of free T-shirts and water bottles to entice them
to get credit cards. To hear high school students are accepting
credit cards seems like a slippery slope.
Teaching responsibility
But the key is education. I only know the results
of the poll. I don't know the specifics. Maybe these kids have
responsible parents who are teaching them about financial responsibility
by closely monitoring their usage and prompt payment in full of
the balance every month.
For instance, there are prepaid credit cards such
as Visa Buxx that allow an adult to load a certain amount of money
onto a credit card a youngster uses. Once that money is gone,
the card is no longer good unless more money is loaded.
But if the teens are getting free rein to go rack
up credit card debt without responsible payment, that's just wrong.
David Best, president of the Junior Achievement
of Akron Area Inc., said he was also surprised by the percentage
of area students who said they had a credit card.
Questionable sample?
Best said he suspects the demographics of the students
who participated in the poll affected the results.
In our area, 85 teens at schools in Cuyahoga Falls,
Medina, Stow, Tallmadge and Brunswick took part. If students from
Akron Public Schools had answered the questions, perhaps there
would have been fewer who had credit cards.
Best said he doesn't think today's youth know enough
about the basics of finances. That's one of the reasons Junior
Achievement is continuing to develop its economics courses, he
said.
Best said a few years ago, he would have said the
organization's main focus was educating about free trade. While
that's still an important philosophy, Best said the focus is now
on personal economics and family budgets.
``We now refer to it as Economics of Life,'' he
said.
The poll is conducted annually to gauge teens'
knowledge about the importance of financial literacy. Junior Achievement
is a nonprofit organization that educates youngsters about business,
economics and free enterprise.
One thousand students from 60 areas around the
country took the 2004 Junior Achievement Interprise Poll on Personal
Finance. (The ``Interprise'' is a Junior Achievement play on words
on ``enterprise'' and the fact that the students took the test
on the ``Internet.'')
Junior Achievement reported national results. But
it also broke out responses for eight regions that had more than
65 students taking the poll, including Akron.
While it's not complete representation of all students
in our area, it still provides an interesting glimpse at our teens
compared to teens in Bakersfield, Calif.; Chicago, Denver, Atlanta,
Lafayette, Ind.; Minneapolis and the Quad Cities on the border
of Iowa and Illinois.
On the credit-card question, Akron area students
ranked higher than the nation, as well as the individual regions.
Minneapolis came in at 16.5 percent and Denver came in lowest
at 8.8 percent. Nationally, 13.3 percent of students said they
had credit cards.
Akron students were in line with the other areas
when it came to allowances, with the majority (75 percent) saying
they didn't get a weekly allowance. It was more evenly divided
in Bakersfield, Denver and Georgia, where the majority still said
they didn't get an allowance, but it was closer to 50 percent.
In Chicago, 53 percent said they did receive an allowance.
Of those who did get an allowance, 50 percent of
Akron-area students said it was between $10 to $20 per week, 40
percent said $20 to $30, 5 percent said $31 to $50 and 5 percent
said they received more than $50. The average in other areas was
between less than $10 and $30, however in some of the larger metropolitan
areas, like Chicago, 21.4 percent said they got more than $50.
I grew up in the suburbs of Chicago and although
it's been several years since I lived there, I think I can still
say with authority that $50 a week is a lot for a teen to get.
Or maybe I'm just turning into a curmudgeon and I just don't get
it.
Our teens' responses are almost the polar opposite
of the national responses when it comes to whether they work for
their allowance. The majority of Akron-area teens, 71.4 percent,
said they didn't work for their allowance, while 74.1 percent
of teens nationally said they did work for the weekly allowance.
The majority of students in the other seven regions also said
they did not work for their allowance with the exceptions being
Bakersfield and Denver.
Here are some other responses:
• Sixty-nine percent of Akron-area students
said they influence their parents' buying decisions, which was
on par with the other areas.
• Akron-area teens were also higher than the
national average (15.1 percent) with 21.4 percent saying they
owned stock. The only higher responses came from Chicago teens
with 25.6 percent saying they owned stock.
• 48.2 percent of Akron students believed
Social Security would be around when they turn 65; 27.7 percent
said it would be around, but it wouldn't be paying as much; 24.1
percent said it will be gone. That was on par with the national
responses. The biggest gap was in Bakersfield where 64.5 percent
thought there would be Social Security; 31.2 percent said it wouldn't
be paying as much; and only 4.3 percent said it would be gone.
• The majority of Akron teens, 68.7 percent,
also thought taxes are too high today. In Bakersfield, 81.3 percent
thought they were too high and the low was in the Quad Cities,
where 58.1 percent thought taxes were too high.
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