Nearly everyone can benefit from a refresher course in financial literacy. But for those heading out on their own for the first time, getting their first job, opening their first checking account, learning about credit and how to use it among other personal finance skills can literally be a life saver.
That’s why members of Wake Forest University’s Babcock Graduate School of Management Finance Club and adviser Rob Nash, associate professor and Orr Fellow in Finance, have been working with the Forsyth County Department of Social Services for the past five years. What started out as an exercise in curriculum development has evolved into hands-on workshops for foster and group home children who are preparing to age out of the system when they turn 18.
“I think what’s really exciting about it is that while Babcock is doing great things in Nicaragua, three miles from here, we’re helping foster kids,” Nash explained. “We’re involved locally as well as globally.”
Since December 2006, Babcock students and faculty have been working to help small business owners in and around Managua, Nicaragua, to improve the impoverished area’s stagnant economy through business seminars.
The Finance Club held several sessions with 16 to 20 year olds throughout the school year to educate them on such financial terms as credit score and payday lending. Each session involves between 30 and 40 participants who are broken into smaller groups to work with Babcock students, who teach them about budgeting and financial planning, among other financial skills.
"It’s very good for our students to get some hands-on experience," Nash said. "A lot of clubs do service events, but our students are taking skills they are learning here and applying them to enrich the community."
Rick Rutledge, who will graduate with his JD/MBA degrees next month, said several things helped inspire him to participate in the Babcock Financial Literacy Project, not the least of which was a study by the MBA class ahead of his. That study discovered that local efforts to improve financial literacy were very fragmented.
"I also work with Teen Court, a juvenile diversion program, and this helped me to see what these kids end up with when they don’t have role models for life skills," Rutledge said.
Rutledge was lucky. He had the opportunity to take a course in high school that taught basic skills such as balancing and reconciling a checkbook and understanding how interest works.
“I am surrounded by folks – friends, family, fellow students – who have holes in those life skills, if they have them at all,” he said. “But many of them can pick it up quickly once it’s explained. Unfortunately, we realized there are a lot of kids out there who don’t have anyone to explain it to them. The schools can’t afford to provide those sorts of skills, and a lot of kids’ parents don’t have the skills themselves.”
Rutledge said that they looked to youngsters most in need – kids whose lives were in many ways a direct reflection of the lack of skills – and saw them as a place to start to break the cycle.
“Knowledge is power, and these kids need all the help they can get,” he said. “Child Protective Services is grateful for the help with programming. The kids seem to enjoy it. We’re reminded how things we take for granted – even basic knowledge – can be a powerful and productive way to give back, to make the world a better place. If I change the world, it’s almost certain to happen one person at a time. If we help one of those kids in the program come off the program and go on to a positive, productive life, I’ll count myself one person closer to that.”
Mark Henderson, MBA ’09, is taking over the student leadership of the program for next year. He hopes to continue the life skills theme, but increase the frequency.
“This year I participated in the sessions on budgeting and on credit, but hopefully we could provide more sessions for the group next year on topics like job hunting, interviewing, college planning or tax preparation,” he said. “Hopefully, we could get a group of MBA students to find some time maybe every six weeks for a few hours to go help out wherever they can. I believe the kids would enjoy the interaction and would appreciate the message.”