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Raising Financial IQs With A Bite Of Reality

29 September 2017 Written by  By Don Huntington
Published in October 2017 Articles

 For the past 14 years Rob Greaff has been the CEO of Delta Schools Federal Credit Union (DSFCU), which has been offering financial services since 1953. “

“The amazing part of our job is having the opportunity to provide financial services to four generations of some of our original members,” Rob said. In spite of the “Delta Schools” words in the title, DSFCU offers financial services to anyone who lives, worships, or attends school in the Delta area.

An essential part of their mission as a community credit union is to go beyond banking services by contributing funds and volunteering hours to numerous local community programs. Members of the staff especially focus a lot of time and resources on a financial literacy budgeting program for middle school and high school students, called Bite of Reality. The Richard Myles Johnson (RMJ) foundation sponsors the program and makes it available for credit unions in California and Nevada. Delta Schools FCU started presenting Bite of Reality three years ago and so far the program has reached more than 4,500 students. DSFCU has presented the program to six schools in East County including Freedom, Dozier-Libbey, Dear Valley, Antioch, Pittsburg, and Martin Luther King Jr. Junior High. Plans are being made to include Heritage and Liberty. Rob said they are glad to talk to any other schools that may be interested.

Bite Of Reality is effective tool in teaching real-world financial proficiency to students who in many cases are not exposed to those required skills by the adults in their lives. They often see adults making unwise choices — for example, paying for an item offered for a 20 percent discount using a credit card on which they are paying 25 percent interest.

The program is administered at no cost to the students in a particular school by a team of community volunteers and staff working with representatives from the DSFCU office. They set up the entire process on site and organize workshops to train volunteers for the program.

A Bite Of Reality event takes place during a period of two-and-a-half hours in a gymnasium or assembly hall on the school campus. The exercise leads students through a simulation in which they make adult-like decisions. Students learn by doing how the forces of income versus expenses operate in the real world.

Participants engage in the simulation through an app available as a free download on their iPhone or Android smartphones. They are assigned an identity for the exercise and given a virtual occupation and salary, plus a family to support. They are then required to support their pretend spouse and family, while managing student loan debts, credit card debts, and medical insurance payments. They visit eight stations where they make choices in spending the remainder of their funds for such things as housing, trans­portation, food, clothing, household necessi­ties, and day care. If they get into financial difficulties, students are required to visit the credit union station. There, credit union representatives will assist them in managing their finances to help them get back into budget so they can complete the program.

Bite Of Reality forces teens to make finan­cial decisions that permit them either to live within their means by budgeting their expenses and accruing wealth, or to succumb to the temptations of outspending their income. The program provides an added level of reality by forcing participants to make their buying choices while volunteers, playing such roles as a pushy car salesperson or commis­sion-based realtor, are trying to upsell them.

Just as in real life, they are forced to weigh their wants versus their needs. They must deal with such unpleasant realities as choosing whether to pay for a family trip to Hawaii or buy clothes and diapers for the kids; or whether to buy a Maserati or a bus pass. Bite Of Reality becomes even more realistic as students encounter a random “Fickle Finger of Fate” factor that increases their supply of cash with unanticipated windfalls or diminishes it through unexpected expenses. They make financial choices in a safe environment where there’s no harm in failing.

At the conclusion of each session, Rob or Jessie addresses the students. They will ask them, “How many of you have better appreci­ation of what your parents are doing?” The students respond with affirmation. “When you go home today, how about telling your parents, ‘Thank you!’”

Bite Of Reality participants learn real-world skills that will potentially improve their subsequent quality of life in a dramatic way.

However, there is a ripple effect, because all of us in society profit from being part of an economic system in which people are actually accruing wealth and spending it wisely.

I spoke with Diane Burgess, who is now a County Supervisor. Diane worked with the program for the first couple years DSFCU administered it. “It’s a great program that provides kids with a realistic picture of what it takes to manage their finances,” Diane said. “I enjoyed my interaction with them, watching them develop strategies for dealing with the various scenarios and circumstances, planned and unplanned, that they might run into in their lives.” Diane concluded by saying, “I’m sure Bite Of Reality provided information and experience that actually assisted many of them in making important financial decisions that are already making them more financially stable.”

Managers and staff at Delta Schools Federal Credit Union are doing whatever they can to sponsor and promote the financially healthy society we all wish for. Bite Of Reality is laying a foundation with the potential of improving our society far into the future.

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