Nearly one-quarter of Millennials spend more than they make each month.1
One-in-three adults in America have saved nothing for their retirement.3
60% of people ages 18-34-year-olds engage in expensive credit card behaviors (paying the minimum due, paying late fees, paying over-the-limit fees or using the card for cash advances).2
The reason so many of U.S. adults are struggling to make wise financial decisions? It may have to do with the lack of money management tools and strategies they are given in high school. In fact, only 17 states require high school students to take a class in personal finance—a number that hasn’t changed since 2014,1 and one-in-six students do not reach the baseline of proficiency in financial literacy when they graduate.1
Minnesota is one of the states without a minimum level of financial literacy for high school graduation, and curriculum about personal finance is mostly absent in schools.
BestPrep, a Minnesota-based nonprofit, is seeking to fill this financial literacy gap.
Partnering with local schools and teachers, BestPrep provides educational programs to students in grades 4-12 to ensure that students are college-prepared, work-ready and career-bound. Last year, BestPrep’s programs impacted over 58,000 students and an estimated 1.6 million have been reached since its founding in 1976.
While BestPrep’s seven programs cover a variety of topics bridging the gap between classroom learning and workplace skills, in the last 10 years, they have created more financial literacy programs and curriculums.
BestPrep recognizes that improving financial literacy is a massive undertaking, and the schools can’t handle on their own.
“Teachers are so important, and our organization helps give them resources to enhance their programs,” says BestPrep CEO and founder, Bob Kaitz. “Most schools cover financial topics in social studies and economics, but this is mostly macroeconomics—banking taxes and policies. Our programs focus on the basics of personal finance: budgeting your money, insurance, etc.”
To create these programs, BestPrep has utilized the financial services industry, which is especially equipped for the duty of training the next generation of financial decision-makers. They have partnered with the Financial Planning Association of Minnesota and individual financial professionals to create and implement their financial literacy programs.
North Star Resource Group has proudly worked with BestPrep to improve financial literacy in Minnesota. According to BestPrep, in the last year, 24 team members and advisors from North Star offices in Minnesota have volunteered over 530 hours of time with BestPrep’s programs.
North Star Resource Group team members and staff at BestPrep’s Annual Luncheon. Pictured from North Star: Ed Deutschlander, Andy Tate, Jay Pugh and Chase Brakke.
While most financial professionals focus on teaching financial literacy to adults,3 North Star advisors have seen the benefits of teaching good financial habits in high school, before debt and poor savings strategies have taken their devastating toll.
“I grew up in a household where my mom and dad talked about money and investments, and I have realized most families do not,” says Andy Tate, North Star financial advisor. “Then, you ask an 18-year-old to head out on their own and just figure it out. That is a tough hurdle to overcome and a few poor decisions early on can stick with you for decades, if not a lifetime.”
Andy Tate, financial advisor at North Star Resource Group, presenting the BestPrep Financial Matters curriculum to a high school class.
To combat the silence around financial matters students may experience at home, BestPrep has developed a variety of programs to help students feel more prepared for when their financial well-being is entirely up to them. Their wide variety of programs make the sometimes hard to understand content accessible to students at any level and with any learning style.
“The [BestPrep] message stays the same: improving financial literacy and career readiness,” says Tate, “But the delivery varies depending on the audience.”
Out of their many program options, most North Star volunteers have been involved through BestPrep’s Classroom Plus and Financial Matters presentations and their eMentor program.
In the Classroom Plus and Financial Matters programs, advisors speak to student in classrooms, teaching real-life lessons in money management. They use curriculums created by BestPrep staff, middle and high school teachers and a committee of financial professionals covering topics such as money and values, budgeting, credit, investing and the career of a financial advisor.
“In our [classroom] programs, we use real life examples,” says Kaitz. “We do the math with kids to help them figure out how much they’re really spending at coffee shops and decide if that how they want to use their money. We talk about needs and wants and show the difference between the name brand and generic to help students decide if the label is worth the extra cost. Our classroom volunteers also use themselves as examples of mistakes and smart decisions, and that always hits home. Kids are much more likely to remember the story than a statistic or graph.”
No matter the topic, instructors focus on the mindsets and emotions that can make seemingly easy money decisions difficult in certain circumstances.
“The goal isn’t to tell them how they are supposed to live or act, but to help them understand their choices and how they can be better stewards of their money when the decision finally becomes theirs,” says Chase Brakke, North Star disability insurance consultant and member of the BestPrep Financial Matters Advisory Committee.
Chase Brakke, disability insurance consultant at North Star Resource Group, presenting the BestPrep Financial Matters curriculum to a high school class.
This dual-focus of managing emotions and then training on smart financial practices works. Students come away feeling more confident in their money management abilities, as well as energized to start making wise decisions. “Some students ask if they can start saving now, which is always a good thing to hear!” remarks Brakke.
North Star employees are also involved one-on-one with students in BestPrep’s eMentor program.
In the eMentor program, high school students are paired with a caring adult mentor for an eight-week email mentoring relationship. Each week, the student and mentor receive a question to prompt their conversation on topics such as careers and college readiness, with some personal finance questions. However, BestPrep has recently launched a new eMentors for Financial Literacy program to address the greater need for financial literacy education.
Halfway through the eMentor program, students and mentors meet in-person at the mentor’s workplace for a Meet and Greet event, which often solidifies the power this type of relationship can have in a teen’s life.
“Our work with BestPrep has profound impacts beyond just the students that we mentor,” says Michael Fraser, North Star advisor and coordinator of the eMentor program at North Star. “These are the future leaders of Minnesota and possibly even North Star. The students who participate are generally very excited to hear from our business experiences and respond that they learn a lot of valuable lessons they can soon apply to their own lives.”
North Star mentors and students from Anoka Hennepin STEP at the Meet and Greet at North Star in Minneapolis halfway through the eMentor program in April 2019. Pictured from North Star: Adam Amys, Michael Fraser, Wes Sharp, Justin Bernacki, Tyler Kosen, Mariann Rutter, Mary Claire Wente, Kyle Larsen and Alexis Lutterman.
While BestPrep’s programs have undoubtably changed the lives of Minnesota students, volunteering with the kids has also affirmed the value of financial services for many who have chosen it as a career path.
“Each time I volunteer with BestPrep, I walk away with a new appreciation for what we do as financial advisors and am completely recharged,” says Tate.
And Brakke expands on this sentiment:
I’ve seen the impact it makes on adults when we are trying to get them organized and sometimes out of a hole, and I’ve seen the gratitude they have. But what I’m seeing now is how we can start to shape the minds of young adults at the perfect moment when their habits start to form. My intervention could prevent this young person from being 35 and buried in debt with no future savings.
The testimonies from North Star advisors make it clear, as the financial services industry strengthens financial literacy in the classroom through BestPrep programs, the BestPrep programs are also strengthening the financial industry.
When personal finance training starts in the classroom, it can have a ripple effect on generations of students. “Just last month,” describes Kaitz, “A student who had played our Stock Market Game in 1991 reached out to let us know he is now a successful financial planner in California, and he credits his career choice to playing our game back in high school.”
While the state of financial literacy in America is dismal, nonprofits like BestPrep are hoping to make a difference.
You can be part of this change by volunteering in one of their many student programs.
Or, if you would like to make a dent in financial literacy through your personal and professional life, consider the career of a financial advisor. This calling gives you the independence to run your own business, the income to support your own financial goals and the impact of improving the quality of life of each of your clients through coaching and thoughtful advice. Learn more about a career at North Star by reading about our core values or by reaching out to one of our enthusiastic recruiting specialists!
1Council for Economic Education (2019). Retrieved from https://www.councilforeconed.org.
2FINRA Investor Education Foundation. (2018, June). The 2018 National Financial Capability Study. Retrieved from https://www.usfinancialcapability.org/downloads/NFCS_2018_Report_Natl_Findings.pdf.
3InvestmentNews. (2018, September). Closing the Financial Literacy Gap: Turning Passion into Action. Retrieved from https://info.bnymellon.com/rs/651-GHF-471/images/pas-closing-the-financial-literacy-gap.pdf.