JA Finance Park®
BNI Foundation
2012 Impact Statement
Thanks to generous support from donors like BNI Foundation, JA Finance Park® is one of the most dynamic, innovative and effective ways to teach practical and immediately-applicable financial literacy skills to young people in Greater Los Angeles.
BNI Foundation’s Impact
BNI Foundation’s generous $10,000 donation funded 154 students to experience the life-changing impact of JA Finance Park®. These students would not have had the opportunity to learn these important financial literacy skills were it not for your generosity.
Background
Today’s young adult population, particularly in Greater Los Angeles’ low-income community, faces educational and home environments that ill-prepare them to be financially responsible adults. Without a basic knowledge of personal finance and lacking positive financial role models, these students are at risk of adopting bad financial literacy habits, such as: spending beyond their means, not saving for the future, and abusing credit. Such behaviors can bury them in debt, which presents significant barriers to future economic success.
Junior Achievement teaches students the financial survival skills needed to protect and build assets. JA Finance Park®, in particular, is a financial literacy game-changer. JA Finance Park® is a financial literacy boot camp and budgeting simulation for middle and high school students. The program takes place both in classrooms, as well as at the JA Finance Park® facility in Los Angeles. The course teaches students essential financial skills, including: how to draft and live by a monthly budget; how to wisely use credit; the importance of insurance to protect against major life events; and how to plan and save for the future.
Before their field trip to JA Finance Park®, students participate in a seven-week, in-class financial literacy boot camp. This course provides students with a fundamental understanding of personal finance and teaches them key concepts relating to savings, budgeting, debt, taxes, insurance and credit.
Upon completion of the in-class program, students take a field trip to the JA Finance Park® facility for a day-long budgeting simulation. Upon arrival each student receives a debit card featuring a unique, random “life scenario” including income, taxes, and number of dependents. With guidance from volunteer mentors from the business community, students calculate their net monthly income and draft an appropriate monthly budget.
JA Finance Park® contains seventeen fully-branded business kiosks, each of which represents a line-item on the students’ budgets, and each of which offers different spending choices. Once a student determines, for example, his/her maximum and minimum budgeted expenditures for transportation, they will visit the Toyota kiosk to “purchase” a car that fits their unique budget constraints.
Students will repeat the exercise for each of the seventeen kiosks, visiting, for example, the Bank of America kiosk to select a home mortgage and the State Farm kiosk to purchase home and vehicle insurance. Students also budget for utilities (Gas Company, SoCal Edison), restaurant, groceries, and discretionary expenses, such as recreation (Sport Chalet).
At the end of the day, volunteers check students’ purchase and savings decisions to ensure they have not violated their budget constraints. The simulation is designed to reflect reality as closely as possible: a handful of students each day are randomly selected to receive “Unlucky Chance Cards,” which require a student to budget an additional sum of money in order to pay for an unexpected expense, such as a flat tire.
Beyond the applicable budgeting skills students take from JA Finance Park®, staff and volunteers frequently hear comments from students that reflect an increased appreciation for the true cost of goods and services, such as: “Now I know why my parents get stressed out over money,” and “I never realized how much it cost my mother to buy me these gym shoes.” Most students quickly realize they will need a high income in order to support the affluent lifestyle they envision for themselves.
As a result, JA Finance Park® helps students viscerally to understand the need to think about their future careers and lifestyle choices, as well as the importance of higher education as a pathway to personal and professional success.
Measuring Success
The students’ visit to JA Finance Park® serves as a final proving ground for whether they have absorbed course lessons. Students are only considered to have “passed” the simulation if they can demonstrate they have adhered to their budgets and set aside savings. The JA Finance Park® simulation is fully computerized, which allows us to track the percentage of students who meet the above criteria. Most days, the pass rate for students exceeds 80%.JA is confident these students have mastered the course and are fully prepared to apply budgeting techniques to their own lives.
Third party research has shown that JA students provide more accurate definitions of the free enterprise system, are more likely to receive academic honors, and are 85% more likely to express a desire to finish high school, compared to their non-JA peers.
High demand among educators and parents demonstrates the effectiveness of the JA Finance Park® program. Success is also reflected in the 8,000 students who completed the program in the fiscal year ended June 30, 2012. Most came from low-income areas such as East Los Angeles, Crenshaw, Downtown Los Angeles and Canoga Park. Nearly 69% of students impacted through JA Finance Park® come from families that qualify for the National School Lunch Program, a reliable indicator these students come from low income households.
Warmest regards,
Adam
Adam Lubin
Senior Director