Bankers teach youths to manage money

TAYLORSVILLE — "Do you want to spend $20,000 for a $10,000 car?"

That's the question Gabriel Perez asked English as a Second Language students at Taylorsville High School this week, using a five-year, 20 percent loan as an example.

Not surprisingly, the answer was a resounding "no."

Perez, Zions Bank Midvale branch manager, taught money management to three classes as part of Get Smart About Credit, a national program sponsored by the American Bankers Association.

"Save money before you start to spend money," Perez said. "You deserve to be free of debt."

The students learned what can happen if they don't manage money wisely: The average college senior's credit card debt is $20,400, and the average credit card interest rate is 16 percent, according to the Utah Bankers Association.

Kristen Wilde, spokeswoman for the Utah Bankers Association, said more than 85 bankers statewide are participating in the program this year, its second year in the state.

The students Wednesday learned about credit, debt and savings. One note that surprised some students was compound interest: how their savings could grow over time.

"It's good to save for your future," said Belinda Lagomarzino, 15. "I'm going to do it."

Zaida Torres, 16, added: "Little by little is how it starts."

Their teacher, Jen Johnson, said it's important for her students, many of whom are looking forward to college, to start thinking about money management now.

"It's important to see what savings can really build to," Johnson said.

The message is particularly important in Utah, which leads the nation in personal bankruptcy rates, Wilde said. One of every 36.5 households in Utah files for bankruptcy. That rate, in part, led to a new requirement that schools develop a core curriculum that focuses on money matters.

While Get Smart About Credit is new, Utah's banks and credit unions have been in the business of financial education for some time. Another bank program is Your Banker and You, and credit unions are involved in the National Endowment for Financial Education.

More than 50 organizations, financial institutions, government agencies and corporations are part of the Utah Jump$tart Coalition, which is working to improve financial literacy among all ages of youths, said Jodi Mitchell, spokeswoman for Mountain America Credit Union and former chairwoman of Utah Jump$tart.

"We're dealing with youth who don't know a lot about credit," Mitchell said. "If they don't go into the world with knowledge about credit card accounts, they are going to learn the hard way."

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E-mail: dbulkeley@desnews.com