Financial Literacy

Financial Literacy Instruction Program (FLIP)

Financial literacy touches every aspect of an individual’s life and, as with anything else, the more you know the more you benefit.  Lack of financial literacy has resulted in generation after generation being stuck in poverty with little hope of breaking the cycle.   By focusing on financial literacy at an early age, the cycle can be broken and a path to success and independence can be formulated.
Magnolia CDC has a developed Financial Literacy Instruction Program (FLIP)
designed to provide an instructional course of study for young adults. The program will target 20 students at an estimated cost of $2,700 per student.  The students will be selected from the University of Louisiana at Lafayette’s Upward Bound Programs. The UL Lafayette’s Upward Bound Programs are designed to assist low income and/or first generation high school students with enrolling in post-secondary education. By networking with the Upward Bound Program, Magnolia CDC will have access to a steady pool of eligible participants.  Selection will be via an application process based on an approved criterion.  The program’s focus is on financial literacy training for grades 9-12.  Phase I, the initial start-up pilot program will target seniors participating in Upward Bound Program.  Phase II, III, IV to be implemented in years 2-4 will focus on grades 11, 10 and 9, respectfully.  The geographic outreach encompass seven parishes in southern Louisiana; Lafayette, St. Landry, St. Martin, Acadia, St. Mary, Iberia and Vermilion located in the Acadiana area served by UL Lafayette’s Upward Bound Programs. The FDIC’s Money Smart for Young Adults program will be the core of the course curriculum.  The program consists of age-appropriate activities designed to teach participants about “paying yourself first (saving),” “wants versus needs,” and other important financial lessons.
Financial literacy, or lack of, affects every individual on a daily basis.  Whether the decision is as small as to purchase on credit or not, or whether to decide on a mortgage over 15 years rather than 30 years, decisions are made daily that affect current and future financial matters. The objectives of the program are as follows:  a) manage a checking/savings account, b) understand the value of setting financial goals and paying yourself first (saving), c) learn how to use credit wisely, and d) learn about paying for college and home ownership.
The objectives will be met using the curriculum listed below which consists of materials, activities and content geared towards the ages of 12-20 years old.  Instructional modules will include the following:  1) Bank On It An introduction to bank services, 2) Check It Out – How to choose and keep a checking account, 3) Setting Financial Goals – How to keep track of your money, 4) Pay Yourself First – Why you should save, save, save, 5) Borrowing Basics – An introduction to credit, 6) Charge It Right – How to make a credit card work for you, 6) Paying for College and Cars – General information on installment loans, and 6) A Roof Over Your Head – What home ownership and renting are all about.
In addition to the above Money Smart for Young Adults curriculum, the course will include an introduction to financial planning basics by R. Keith Broussard, CFP in the following five components of financial planning:  taxes, investments, insurance, retirement, and estate planning.
The course will also include access to volunteer guest speakers, i.e., bankers, investment advisors, insurance agents and other financial industry professionals, (via Google Hangout) that will educate the participants on various components of the financial industry. The principals have designed a program that is measurable, results oriented and have the ability to be expanded as well as duplicated.
The course will be taught remotely over a 12-month period, averaging 4-6 hours per month.  Each participant will be issued a laptop computer with remote access to the internet over the course of the program.  In addition, each participant will receive a $1000/year stipend that will be deposited into a Louisiana Start 529 account established for the participant at a local bank.  The START (Student Tuition Assistance and Revenue Trust) Saving Program, an innovative college savings program, qualifies as a “529 Plan” under the Internal Revenue Code.  START offers federal and state tax incentives to anyone who wishes to financially assist a student in acquiring a college education. The Start 529 program offers various investment opportunities, which the financial literacy program will allow the participant to team with their sponsor in managing the education fund.
Magnolia CDC will be the designated owner of the account and the participant will be the beneficiary.  Upon completion of the program, the participants will have access to the account for post-secondary education related expenses.
In addition to financial support, Magnolia CDC is also soliciting technical support from the financial industry in the continuing development and sustainability of the program and welcomes any input.