Finance Park Gives Students a Head Start on Spending Responsibly

Ralph Miranda, a student at the Downtown Business Magnet, recently discovered that altruism is not always compatible with economic self-preservation.

As a participant in Junior Achievement’s Finance Park, an exercise that teaches students lessons in personal finance, Miranda and other students from his school was provided mock bank cards with random personal and financial data.  They then had an hour in which to make critical funding decisions –shelter, transportation, food, and other necessities – while also maintaining a balanced budget.

Miranda decided to donate a portion of his income to deserving non-profits; in the end, this act of kindness and generosity left him without health insurance and $300 over budget.  As a result, he had to take some money designated to various organizations and reallocate it to cover his health care expenses and eliminate the deficit.

Junior Achievement of Southern California, which has as its stated goal “to inspire and prepare young people to succeed in a global economy” and runs on an annual budget $4.8 million provided by individuals, corporations, and foundations, launched Finance Park four years ago at its main office near Griffith Park.

According to Bernadette Gilbert, senior program manager for Finance Park, since that time nearly 35,000 students have participated, more than half from middle and high schools in the Los Angeles Unified School District.

“This exercise is about students learning to make good choices,” said Margo White, Executive Vice President, Junior Achievement of Southern California, which has been in existence since 1954.  “It also gives them the chance to see the immediate consequence of not making the best choice.”   She said that prior to their participating in Finance Park students will have received at least 15 hours of personal finance instruction at their schools. 

The park, which in actuality resembles a large community room, consists of 18 “storefronts,” where students are directed to meet with sales representatives and advisers to make financial decisions.  Companies such as Toyota, State Farm Insurance, Union Bank, and Sports Chalet pay sponsorships to be represented in the park.

Students from the USC and UCLA business schools often serve as volunteers for the program, working with participants to help them set their spending priorities. 

When the students enter the park, they receive a demonstration Union Bank card with their fictional information contained on the back side.  These mini-biographies include gross annual income, amount paid in various taxes, age, marital status, and age of children, if the bearer of the card is assigned any.

“They love it,” said White.  “It’s like getting their first credit card.”

On a recent day when students from the Downtown Business Magnet attended the park, the noise level was somewhere between a library during finals week and a pep rally.  In quiet but audible tones, students discussed their financial decisions with each other, and examined various options with volunteers and sponsors.  At the end of the exercise, when personal budgets were balanced and attendees had a better grasp of the challenges of staying solvent, a debriefing was held.

White noted that the students come away from Finance Park with a keener appreciation for the budgetary responsibilities their parents face.  She said some of them actually take their budgets home, as a guide to their parents or guardian.

But they also sometimes wonder whether the information on the card is a too much of a financial burden to overcome.

“I’ve had eighth-grade boys come up to me and say ‘I need a divorce,’” noted a smiling White.

On the other hand, Michelle De Leon, a senior at the Downtown Business Magnet, lamented that her unmarried status made the exercise too easy, and carefree.  “I wish I had a card with two kids or something so I would have had more pressure to make ends meet,” she explained.

Karla Sandoval, another Downtown Business Magnet senior, works part-time as a waitress at a Sheraton Hotel and lives at home with her parents.  The money Sandoval currently makes falls into the category of disposable income.  She said Finance Park was helpful in forcing her to confront the stark, difficult financial decisions that will soon be part of her life.

“I have a better sense of how to budget my money,” she noted.

For White, the value of the exercise lies not only in the teaching of financial responsibility, but as a counter to the opulence and sense of financial entitlement hat has become endemic throughout the culture.

“Living in Los Angeles, surrounded by the entertainment industry and Reality TV,” said White, “the thought is that ‘I should be able to have everything whenever I want, whether I have the resources or not.”  But while that philosophy defines Real Housewives from Orange County to New York, it’s anathema to the kids who must navigate Finance Park.

Photo caption: More than 35,000 students, many from LAUSD, have come to Finance Park since the program started 4 years ago.

By: Tom Waldman
Posted: March 14, 2012