Survey Shows Many Parents Miss Key Opportunity to Teach Teens Money
MCLEAN, Va., Aug 05, 2010 (BUSINESS WIRE) --
This back-to-school shopping season, many teenagers have their eyes set
on big-ticket items like e-readers, computers and smart phones, but
parents footing the shopping bill plan to stick to the basics such as
clothes and traditional supplies, according to a new survey from Capital
One Financial Corporation (NYSE:COF). In the company's tenth annual
back-to-school shopping survey of parents and their teens between the
ages of 13-17, one-quarter (25 percent) of teens listed a cell or smart
phone, computer or an electronic device such as an iPod or e-reader as
one of three top items they plan to purchase before heading back to
school this year. Only 14 percent of parents surveyed, however, listed
one of these items as a top purchase for back-to-school.
Capital One's survey also found that only one-quarter (24 percent) of
parents have created a back-to-school shopping budget with their child
and only one-third (31 percent) of parents have created a shopping list
with their child. One-quarter (27 percent) of parents admit they have
not had any conversations with their child about planning for
"This year's survey found several gaps in budget expectations and
communication between parents and teens regarding back-to-school
shopping plans," said Shelley Solheim, Director of Financial Education
at Capital One. "Back-to-school shopping season is often overlooked as a
financial education opportunity, but it's an optimal time for parents to
teach teens about budgets and smart spending in a real-world situation."
Teens are Looking for Money Guidance
Half (53 percent) of teens polled say they want to learn more about how
to manage their money. More teens say they would prefer to learn about
money from their parents over friends, reading a book or taking a
personal finance class, but only 27 percent of teens report that their
parents discuss money and banking concepts with them regularly.
Overall, teens report limited practical experience managing money. Less
than half (46 percent) of teens surveyed currently receive an allowance
and only one-third (33 percent) have a checking account. The survey
results suggest that having a checking account is associated with higher
levels of confidence among teens regarding their money management
knowledge. Seventy percent of teens surveyed who currently have a
checking account rate their money management knowledge as "good" or
"very good," compared to 58 percent of teens without a checking account.
Although many teens may not be ready for a checking account, parents can
allow teens to watch them balance the checkbook and pay bills in order
to get familiar with the practicalities of basic banking.
Teaching Teens to Shop Smart
To help parents and young adults effectively talk about financial
choices, challenges and dreams, Capital One has partnered with the
Search Institute to create Bank It, a free multimedia financial literacy
program available online at www.bankit.com.
The program is designed to help parents and teens work together to learn
practical skills for making positive money choices and avoiding common
In addition, Capital One offers the following tips to help parents take
advantage of back-to-school shopping season to teach their teens good
money management skills:
- Make back-to-school shopping a
family affair - It's a great opportunity for teens
to learn valuable hands-on lessons from their parents.
- Do your homework - Talk
to teachers in advance and try to get a list of required school
supplies so you can buy in advance (maybe even on sale.)
- Crunch numbers together - establish
a budget - Determine how much you're able to spend
in advance and stick to the amount.
- Consider having your child
contribute - Our survey suggests that many teens are
prepared to help pay for back-to-school shopping. Half (52 percent) of
teens report that they expect to contribute money for back-to-school
shopping, but only 19 percent of parents surveyed expect their child
to help pay. Discuss how much they may contribute and work it into the
budget you develop.
- Make a list - Prepare
your shopping list in advance. Try to distinguish between "needs" and
"wants" on the list and prioritize the needs first.
- Shop smart - Make
sure you shop around for the best price and the best quality and use
coupons when possible. Even if you don't plan to shop online,
encourage your teen to look at prices online to see how they fit with
the budget before you head to the store.
For the Capital One Study Back-to-School study, Braun Research was
engaged to conduct 1,000 interviews in 500 households with 500 parents
of teenagers age 13 to 17 and 500 teenagers age 13 to 17 across the
United States. Surveys were conducted by telephone from July
11th through July 18th, 2010. The margin of error for the interview is
plus or minus 3.34 percentage points. Interviews were monitored at
Sampling for this study was conducted across the United States using
a national probability sample of all exchanges and area codes of
households with someone between the ages of 13-17 living there. All
interviews were conducted using a computer assisted telephone
interviewing system. Statistical weights were designed from United
States Census Bureau statistics.
About Capital One
Capital One Financial Corporation (http://www.capitalone.com/)
is a financial holding company whose subsidiaries, which include Capital
One, N.A. and Capital One Bank (USA), N. A., had $117.3 billion in
deposits and $197.5 billion in total assets outstanding as of June 30,
2010. Headquartered in McLean, Virginia, Capital One offers a broad
spectrum of financial products and services to consumers, small
businesses and commercial clients. Capital One, N.A. has approximately
1,000 branch locations primarily in New York, New Jersey, Texas,
Louisiana, Maryland, Virginia, and the District of Columbia. A Fortune
500 company, Capital One trades on the New York Stock Exchange under the
symbol "COF" and is included in the S&P 100 index.
SOURCE: Capital One Financial Corporation
Shelley Solheim, 804-284-9366