Volume 10; No. 4; Summer 1998
Getting High Marks for Service: Financial Education in Schools
By Jessica Hebert, Portfolio Manager and Senior Examiner, Federal
Reserve Bank of San Francisco
Financial education in primary and secondary schools is an increasingly
sought after element of school curriculum development. Educators, businesses,
community groups and parents realize that instruction in the fundamentals
of banking and finance can help children grow up to be responsible adults.
Recognizing the rewards of educating and empowering students with the
tools of financial literacy, the financial community is becoming an active
and growing force in the education sector.
What are the Rewards?
Banks can benefit from involvement in financial education by receiving
credit under the service test of the Community Reinvestment Act (CRA),
provided bank activities are directed to low-and moderate-income people.
Since banking services are often scarce or non-existent in underserved
communities, many adults, also deprived of financial education, are not
in a position to educate their youth. Fortunately, there are programs
designed to address these needs and some are described here. You might
want to consider joining one of these programs, seeking similar programs
in your area, or even creating your own program.
Finance on Friday
Among the largest and best known programs offering financial education
is Junior Achievement (JA). Founded in 1919, JA reaches nearly 2.7 million
U.S. students across the nation. The organization aims to educate and
inspire young people to value free enterprise, understand business and
economics, and become work-force ready.
Using a structured financial education program with school-to-career
transition programming and age-appropriate curricula (K-12), JA was developed
and is implemented by classroom volunteers from the business community
both in the U.S. and in approximately 100 countries world-wide.
Corporate support is essential to the success of JAs programs. An example
of how local business has supported JA is Finance on Friday, a financial
education event sponsored and underwritten by Visa International (Visa)
through a community affairs grant in coordination with the Bay Area Urban
Bankers Association. The activity involved over 1,500 economically disadvantaged
students at two elementary schools in Oakland, California. Approximately
55 volunteers from Visa and the banking community participated in the
event, which featured personal finance, community development, entrepreneurial
skills, goal planning, and personal achievement.
Banking on the Future
In southern California, a local non-profit, Operation Hope (OH), has
implemented its own program known as Banking on the Future (BOTF). OH
works in partnership with various organizations and individuals including
banks, schools, public service agencies and corporations to bring BOTF
to inner-city classrooms. Youth learn the fundamentals of opening and
maintaining bank accounts, budgeting, and the importance of credit.
International Bank of California Vice President and CRA Officer Richard
Oladapo appreciates that BOTF focuses on low-and moderate-income communities.
Apart from tangible CRA benefits, the BOTF program helps foster the growth
of fiscally responsible adults. Therefore, Oladapo believes that inner
cities are an ideal location for the BTOF program because they have an
abundance of children and adults with the potential to develop and grow
successful business ventures.
Kids Own Bank
Banker Don Cohen, a community real estate lender for the Associated Bank
of Milwaukee (AB), works with an educational program facilitated by the
Milwaukee Education Trust named Kids Own Bank (KOB). After the successful
launch of the first elementary school KOB, Cohen asked the University
of Wisconsin, Milwaukee to develop an expanded KOB education program in
partnership with his bank.
KOB is a school savings program that utilizes a comprehensive, ten-lesson
financial education curriculum. It requires active participation by students
in the actual operation of their own bank. The program relies on a series
of comic books published by the Federal Reserve Bank of New York and on
other free publications available from the Federal Reserve System. AB,
one of the program sponsors, provides deposit and withdrawal slips and
passbooks for participating students. When each students account reaches
nine dollars, AB, or in some cases another corporate sponsor, agrees to
provide the last dollar. When each account reaches ten dollars, it is
transferred to AB and converted into a conventional savings account.
The KOB program is directed at schools in low- and moderate-income areas.
Cohen identifies qualified schools based on the percentage of each schools
enrollment that is in government-sponsored school lunch programs.
In just four years, 39 schools throughout the state have implemented
the program and other states want to replicate it. Just as rewarding,
Cohen says, is knowing that the program serves a dual purpose: educating
parents as well as children in the fundamentals of financial education.
Bank At School
Although classroom instruction and the experience of saving money are
important, exposure to financial institutions is also useful. Illinois
The Bank At School program provides this exposure. It was developed
and sponsored by the Illinois State Treasurers Office as a joint effort
with elementary schools and financial institutions. The program consists
of two sections, classroom instruction and bank day. During bank day
students take a field trip to their sponsor-bank and are exposed to bank
operations through practical student-teller training. They also are given
the opportunity to open a personal savings account.
To date, the program has enjoyed the successful participation of approximately
108,000 students, 675 school districts, and 400 partnering financial institutions.
To ensure the program is accessible to youth of different backgrounds
and ethnicities, the teachers manual has been translated into six foreign
With numerous programs available and seemingly limitless resources and
possibilities, becoming a player in the financial education arena could
not be easier. Banks can provide services such as classroom-instruction
and technical assistance or can participate on the boards of organizations
that further financial education.
In any case, bank involvement in financial education in schools is a
win-win situation. Banks can further their CRA goals and at the same
time promote and foster the development of a generation of financially
For more information on Banking on the Future contact Operation
Hopes Lashan Epperson, Program Manager, Banking on the Future & Entrepreneurial
Training at (213) 891-2909.
For more information on Kids Own Bank contact Don Cohen, Associated
Bank, Milwaukee at (414) 283-2284 or Paul Haussman, University of Wisconsin-Milwaukee
at (414) 227-3265. For more information on The Bank at School program
contact Illinois State Treasurer Judy Baar Topinkas Office at (217) 782-6540.
Also look for the JumpStart Coalition for Personal Financial Literacy,
a non- profit organization based in Washington D.C. that consists of a
wide range of organizations including federal agencies, universities and
nonprofit associations. Banks interested in learning more about the organization,
and opportunities for participation in the program should contact Dara
Duguay, Executive Director, at (202) 466-8610.
About the Author
|| Jessica Hebert is
a portfolio manager and senior examiner at the Federal Reserve Bank
of San Francisco, where she has spent the past seven years in positions
of increasing responsibility. In her current assignment with the
Community Affairs Unit, she assists financial institutions in boosting
their CRA performance. Prior to her career at the Federal Reserve
Bank, Ms. Hebert worked for Bank of America, where she completed
its Preferred Banking Commercial Lending program, and worked in
Retail Banking for three years. She holds a B.A. degree in Business
Administration and Legal Processes from Mills College in Oakland,