It was a day to go back to school for Kevin Painter and Andy Oaks of LeConte Wealth Management, and the message they had for soon-to-be-graduating seniors was simple - make smart financial decisions.
April was Financial Literacy Month, and Alcoa-based LeConte Wealth Management was taking part in local educational outreach by coaching high school seniors on the right way to maintain a good credit standing post-graduation.
The firm presented “LeConte’s Financial Real-World Challenge” on April 9 at Maryville High School, where Painter, co-founder and managing partner, and Oaks, financial planner, led interactive discussions and activities with graduating seniors as part of an effort to teach the importance of financial literacy.
LeConte conducted pre-seminar and post-seminar surveys with students. The results are as follows:
Before the presentation, 80 percent of Maryville High School seniors said they were either very comfortable or somewhat comfortable making financial decisions on their own. After the presentation, this number jumped to 92 percent saying they were either very comfortable or somewhat comfortable making financial decisions on their own.
The survey also showed that 79 percent of Maryville High School seniors said their parents were either very involved or somewhat involved in helping make their personal financial decisions.
In addition, the survey validated the critical role that parents play in their child’s financial future as 76 percent of Maryville High School seniors said they learned about money management from their parents.
With these activities, LeConte Wealth Management hoped to influence young adults to take their financial decisions seriously so that they will not accumulate damaging long-term debt. The firm also aims to teach young adults the benefits of saving money and building good credit for a stable future.
According to the presenters, students’ need for financial literacy and good practical advice is more urgent than ever.
“Debt for college students and young adults has always existed as a common concern - but in this economy, it’s even more of a challenge and a potential threat to young people’s financial futures,” Painter said.
“With rising tuition costs nationwide, students are legitimately more hard-pressed to stretch their educational dollars along with their living expenses,” Painter said. “Plus, back at home, parents can easily be facing financial instability of their own with lost jobs and depleted savings, so students often have less of a safety net. It’s especially critical for students to get started on the right foot financially and to stay on track long-term.”
Painter, a 1993 alumnus of Maryville High School, said it was an honor to return to his school and give back to the community. “Anytime I can help people make smart financial decisions and in this case to create smarter, more aware, soon-to-be college students is an important thing,” he said. “The perils that face these kids as they go off to college - the predator lenders and credit cards they could get and the way they could ruin their credit for years - there’s more to credit cards than the free iPod when they sign up, and we’ve all learned that.”
Painter said the staff at LeConte has helped folks to dig out of those credit holes and helped them avoid bankruptcy. “You see it all. Folks in their 20s, 30s and 40s dealing with bad financial decision they made five or 10 years ago,” he said.
A September 2009 report by The Wall Street Journal indicated students now borrow more than ever for college, with the U.S. Department of Education reporting a steep rise in the 2008-2009 academic year alone, with total student-loan disbursements rising 25 percent over the previous year.
A 2008 survey by Sallie Mae found that 84 percent of college students had a credit card, and of those cardholders, 92 percent used their card for college-related expenses. The average college graduate faces an average credit card debt of more than $4,100.
“Maryville High School offers our Senior Seminars as a proactive approach to help prepare our seniors even more for life after high school,” said Maryville High School principal Mike Casteel. “We are thankful to all of the outside presenters who volunteered to speak with our seniors during these seminars on such important topics as credit and money management.”
In the Maryville High School session, Painter and Oaks taught the five C’s of maintaining good credit: capacity, capital, collateral, conditions and character. With the knowledge learned from the seminar, students will be more aware about maintaining good credit.
“When students accumulate debt, they also have the potential to accumulate bad credit,” Painter said. “Credit is something that many young adults do not fully grasp until they are faced with their own credit problems.”