Last week two of Laird Norton Wealth Management’s Kids and Money team members talked with a large group of Forest Ridge seniors about personal financial planning. Our financial literacy workshops for teens usually cover a wide range of topics that include goal setting, budgeting, loans, credit scores, investments, asset allocation and more – and this January workshop was no exception. However, what did make this workshop ‘the exception’ were the topics generated by the sharp audience members. They were very timely and flagged the key financial challenges awaiting them in short order. The following are a few of the issues discussed. We hope they inspire you to bring these issues up with the teens in your life:

• Student Loans – Fresh from the college application process, some of the attendees were aware of the impending reality of student loan debt and wanted to understand common loan terms like subsidized versus unsubsidized, the government’s role in student loans and the costs of borrowing money. Indeed, the burdens that come with taking on significant amounts of debt – the average amount that students graduate with is $26,500 – should be talked about and carefully considered.

• Credit Cards – The group was very interested in understanding credit. Some students were eager to get a credit card and thought the presenters’ advice and experience regarding the necessity and importance of involving parents in early credit responsibilities especially helpful. On the other hand, there were also a few students that said they “didn’t want to touch a credit card” and admitted to being nervous about making mistakes or getting into debt. Having a credit card is definitely a big responsibility, but it can help teens learn how track their purchases and spend within their means.

• Credit Scores – Piggybacking on the discussion about credit cards, the audience also wanted to understand how credit scores work… what the range is, where you start on the spectrum, and if there are alternative routes to building a credit score without a credit card. Understanding the importance of credit scores and building a good one will help teens eventually finance big purchases as adults like a car or their first house.

• Identity Theft – One student was keen to the fact that credit card companies and reporting agencies have a lot of our personal information and that identity theft is a serious threat. This comment inspired the presenters to teach the group ways to protect their information and about how periodically reviewing credit reports can help alert them to any id theft issues. In this age of social media sharing, teens need to be taught about the dangers of over sharing their personal information.

• Investing – Should I start now? was a popular question from audience members. The presenters saw this as an opportunity to hit home the necessity of adequate cash in an emergency fund before allocating a budget line item to investing. Still, the presenters also thought it was important to talk about risk and encouraged the audience to become educated investors. Learning how to invest carefully and consistently will help teens be better prepared for retirement as adults, especially since they might not have the safety net of social security.

From the level of participation from these students, it was clear that this is an age where the rubber starts to meet the financial literacy road for many teens. On the cusp of daily independence from parental units, they are all at once nervous, excited and practical about the realities of their increasing responsibility. Hopefully, the above topics provoke some beneficial discussions about money with your teens and that the financial knowledge gained will serve them well in all the many places they’ll surely go.