Ohio Teens Hit Money Management Jackpot with Real Money. Real World.

By Melinda Cassidy

Students participate in Real Money Real WorldGroceries: $686. Car insurance: $77. Rent: $626. Knowing how to responsibly handle money: Priceless.

As personal debt becomes a growing concern in Ohio and across the country, some Ohio teens may be able to avoid future financial burdens by completing the Ohio State Extension signature program, Real Money. Real World.

The financial literacy program is designed for youth ages 13 – 16 and teaches students about the value of a dollar through a series of four preparatory classroom lessons, a hands-on spending simulation and a reflective follow-up lesson.

It is in this simulation that Real Money. Real World. truly impacts its participants. Youth "spend" their monthly net salaries at 14 different booths manned by adult volunteers from their community.

"You can go to almost any booth first except for insurance ... I've had a lot of kids that come to the grocery booth at the end, and they realize they can't buy food for their family," said Kathy Michelich, an OSU Extension educator in Warren County. "There is something to that – they realize they can't afford food for their family after they've spent most of their money on things that they can't afford, like nicer cars or entertainment."

For the simulation, participants are assigned occupations, often based on their grade point average, which range from those that do not require higher education, such as dental assistant or flight attendant, to those that necessitate a five- or six-year college degree, such as biochemist and optometrist. Technical school occupations and four-year degree jobs are also possibilities.

Students participate in Real Money Real WorldParticipants are also assigned a random number of children and are 27 years old.

"The assigned age used to be 25, but we thought about how many years it takes to get a college education and then get married and have children," Michelich said. "Twenty seven is about the right age to be entrenched in an adult lifestyle."

All participants are married to a fictional "Chris," a full-time student who contributes $400 net to the monthly budget. The "Chance" booth could provide a windfall like finding $20 hidden in the pocket of a coat, or an unexpected financial expense such as a parking ticket.

The 14 spending simulation booths include basic living expenses such as utilities, rent and transportation. The booths are manned by community business leaders such as realtors and car dealers – this creates a program that consistently and effectively gets its point across to students.

"This program mirrors the experiential model well, because you learn and then "spend" in an active participatory way through the simulation. By doing things we tend to learn them more concretely," Michelich said.

In a 2013 annual report from Real Money. Real World., self-evaluations from students showed 76.5 percent answered "a lot" when asked how strongly they believe their participation "gave a better idea of what is involved in earning, spending and managing money."
Almost three-fourths of last year's student participants also reported thinking the program will help them "a lot" in the future.

With kits in 70 of Ohio's 88 counties, Real Money. Real World. will turn 10 years old in 2015. As this milestone approaches, Michelich said she hopes to widen the program's reach and has begun selling kits to other states, including six recent sales to Virginia land grant university educators.

"There's a good chance that there may be something else emerging that Extension needs to focus on and address, but Real Money. Real World. will still be around," she said. "What I'm most looking forward to is it expanding beyond Ohio."

For more information, contact:

Kathy Michelich, michelich.1@osu.edu