Mom, what if there's another recession?

Kids say the darndest things.

Along with worrying about whether or not they have a date for the homecoming dance and how to finally get rid of that acne, teens today seem to have some pretty weighty issues on their minds. The smart phone in their pocket brings the world, with its political complications and economic upheavals, right to them.

My teen is no exception. Recently he asked "Mom, what if we have another recession?"

Whether I answered his question sufficiently is up for debate, but I'll list the points I made in my response (below) along with a few resources you can use if you're faced with a similar situation.

In trying to develop financial literacy skills in my teen, I'm always working for balance. That means I'm trying not to overload him with so many details that he glazes over, but give him enough data so it's real. Although he's asking about a recession, don't get hung up on technical definitions. What he really wants to know is "will we be okay if something unexpected happens."

Here's what I told my teen.

- It's not really a question of "if" we will have another recession, but "when."
- That said, while the recession in 2008-2009 is the one many teens will be thinking about, there have been many others (here are a few).
- I told him (briefly) about the savings and loan crisis that closed the S&L in our town and the dot-com bust that came later.
- People lost jobs and money in both. But (and here was the important part as far as my teen was concerned) we came through it in the end.
- As a family we believe two ways to weather storms like a recession or crisis are to build up our emergency fund and diversify our investments.

We'd already worked through some of the resources on the #FinLit Menu for Parents (like fun this TedED video about economic bubbles and tulips). That made the whole conversation a lot easier for both of us.

VISA's Practical Money Skills provides
tips for building an emergency fund.

That's how I handled it. You might find a different or better way, based on your family's situation. However you decide to approach it, here are some resources you might find helpful.

Building an Emergency Fund
Publisher: Practical Money Skills by VISA

What causes economic bubbles? 
Publisher: TEDEd

The dot com bubble explained in one minute
Publisher: One Minute Economics

Savings and Loan Crisis
Publisher: Federal Reserve History

A Review of Past Recessions
Publisher: Investopedia

Financial Concepts: Diversification
Publisher: Investopedia

Planning for the Unexpected
Publisher: Practical Money Skills by VISA

What Causes Business Cycles?
Publisher: Practical Money Skills by VISA

Deeper Dive: Practical Money Skills by VISA

You'll find this post most helpful if:
- you're a parent with a pre-teen or teenager.
- you're looking for a one-stop solution for boosting your child's financial literacy and you're wondering if Practical Money Skills fits the bill.

Things you should know:
- Practical Money Skills is part of VISA's long-term efforts to develop education programs for people of all ages.
- The resource is free. No login or account is required.

Things I like:
- Practical Money Skills provides a huge variety of resources for teachers and individuals (or parents).

- Games. I love a good game. Check out Money Metropolis (ages 7-12) and Financial Football (ages 11 and up). Financial Football is an NFL-themed game developed by Visa in partnership with the NFL. If your child is into soccer, they've got that covered with Financial Soccer. The games are designed to be used as a classroom tool and lesson plans are provided, but parents can use them as a stand alone (fun!) activity. Use the info threaded throughout game play to spark conversations.

- A wealth of free materials including apps for everything from budgeting for prom to tracking what you spend on lunch. As for me, I'm most excited about their two comic books (featuring Marvel's Avengers and Guardians of the Galaxy).

Kid-friendly resources from Practical Money Skills

- There is no shortage of good info in this section for parents as well, including primers on budgeting, prepaid credit cards and identity theft. Most can be downloaded right from the website although the comic books need to be shipped (within 3-4 weeks of ordering). I'm a Marvel geek so it will be interesting to see who gets to the mailbox first, me or my teenager.

- If you're looking for something your kid can work through on their own, start to finish, check out Your Money, Your Future. This section seems best for pre-teens and young teens. It covers the basics under the categories of earn, save, budget, spend, borrow, protect and give. These really are primers, so if your teen has some previous experience with financial education this may prove too basic.

- If you need something that's a little more in-depth look at the Learn section of the website. Because it's largely text-based (versus games) it will be a better fit for teens and young adults. Topics covered include saving, budgeting, financial institutions, credit, debt and identify theft. This is where you'll find info about the Rule of 72, compound interest and a check writing/deposit slip demo. The section on credit does a nice job of defining common terms and discussing what it takes to maintain a good credit score.

- You'll also see a section on Life Events which will be a good resource for your college-bound senior (topics include going to college and buying a car). If your teen or young adult really wants to geek out on financial terms and concepts, check out Economy 101. It's where they will find short explanations of business cycles, monetary policy, human capital and more. It's not a bad resource for parents as well. In fact, I'm heading over for a refresher course right after I finish this post.

Prepaid cards are also covered a little more than I've seen in some other resources. I have not used prepaid cards, and there are differing opinions on whether they are the best way to introduce kids to financial products. However there are a number of providers you can go through to get them. The one I hear about the most frequently is FamZoo. I have not researched their offering, but I'm happy to hear about your experiences with them if you have.

Bottom Line
Practical Money Skills by VISA has something for everyone. I really like the breadth of their offering. It will work for your pre-teen, teen or college age student. Just use the information above to zero in on the part that works best for you.

Deeper Dive: Warren Buffet's Secret Millionaires Club

You'll find this post most helpful if:
- you're a parent with an elementary school age child.
- you're looking for a one-stop solution for boosting your child's financial literacy and you're wondering if Warren Buffet's Secret Millionaires Club (SMCKids) fits the bill.

Things to know:
- SMCKids is a free, online financial literacy resource designed for kids.
- The site is sponsored by Genius Brands International and features Warren Buffet as one of several animated characters.
- No account or login is needed to use the site or work through the activities.

Things I like:
- The content is well presented and delivered almost entirely through animated video (webisodes) and comics (both digital and PDF, which is cool) and games. It's all geared toward holding the attention of older elementary and even middle school age kids.
- This resource covers a wide range of what I would consider to be foundational topics, from saving to debt with life lessons thrown in for good measure (learn from your mistakes, build a good reputation).
- Who doesn't love a well designed game? There are four games available on this website but Number Blaster and Counting Money are the two that kids will be drawn to immediately. The other "games" include a quiz and a business building exercise. Interesting, but I don't think kids will think of it as a game.

Things I'm not crazy about:
- I actually really like this resource for younger kids, although I think teens might not be as enthusiastic about the presentation.

My high-tech way of helping my
teen practice making change.

- There isn't much here for teens in the way of topics like checking, savings, student loans, etc. but that's not what this resource was intended to do.

Bottom line:
This resource is geared toward elementary and possibly middle school age kids. It's really well presented and I think younger kids will enjoy watching the webisodes and being introduced to the wisdom of the Sage of Omaha (Warren Buffet) through a medium they enjoy.

I will share this website with my friends who have younger kids, but I plan to have my teen go through the Counting Money game for some extra practice. Side note: you can also do a version of this game at home using real coins and some paper "bills." We've done this a few times on the kitchen table with money from the loose change jar. It's a good way to reinforce the concept and it gave me a chance to share some of my own teenager horror stories from my fast food register days! I'm sure your teen will love hearing your stories about as much as mine did :)

Deeper Dive: The Mint by Northwestern Mutual

You'll find this post most helpful if:
- you're a parent with a child aged (roughly) 10 through young adult.
- you're looking for a one-stop solution for boosting your child's financial literacy and you're wondering if The Mint fits the bill.
Note: don't confuse this resource with Mint.com, which is a money management tool provided by Intuit.


Things to know:
- TheMint.org is a free, online financial literacy resource designed for kids, teens and college students.
- The site is sponsored by Northwestern Mutual.
- No account or login is needed to use the site or work through the activities.
- Once you decide which section you and your teen are interested in (see below), you can hand the laptop or tablet to them, so there is no need to create a curriculum from scratch (although I recommend ongoing family discussions about topics covered). Do check out the caveats below to make sure the content will hold your teen's interest.

Things I like:
- A good range of topics is covered for teens: earning, saving, spending, owing, tracking, giving, investing, safeguarding. If you're looking for a more robust discussion on investing, check out the #FinLit Menu for Parents for some ideas. The Mint stays pretty general and covers a few topics (like series EE bonds) that will be of little interest to your young teen).

- I really like the simple approach to explaining the Rule of 72 Calculator and the ability to play with the concept in an interactive exercise.

- In fact, I liked a number of the calculators and tools on the site. The Spending Challenge takes students through a virtual 16 week time period and presents them with unexpected expenses and choices (takes 5-10 minutes to complete). The Debt Calculator is also easy to use and interesting for teens and older kids.

- Check writing is covered, with an interactive exercise that lets your teen fill one out virtually. Hurray! (The down side is there is no discussion of current payment transfer tools, like Venmo, Square Cash or PayPal, which are the types of tools teens will be more likely to use).

- Why is $10 saved on a $39.95 purchase worth more than $10 saved on a $1,099 purchase? Answer: it's not, and Tricks Our Minds Play With Money is an eye-opening (for me, anyway) discussion about our perceptions of money that's worth having your teen read.

- This resource is really easy to navigate. The amount of content on most pages is kept manageable, a lot of the content is interactive and links are easy to locate.

- TheMintGrad is actually a separate site that looks up to date and may prove helpful for your college age student. I did not review it, but you can check it out here.

Things I'm not crazy about:
- The content on the site is dated. The references to iPods and a lack of info about current money transfer tools like Venmo could make your teen tune out early on. The "The Truth About Millionaires Quiz" uses data from 1998 (although the general points it makes are still relevant). Interest rate examples don't reflect the current rate environment, FDIC coverage amounts listed for money market accounts are outdated, etc.

None of these are necessarily deal breakers but might turn your teen off and will certainly require some additional coaching from you. If you use this resource I would suggest keeping the focus on the concepts covered (which are good) and letting your teen know a number of the details have changed.


Bottom line:
You can hand this website to your teen and ask them to go through it, knowing they will cover a lot of the basics. However, the content is dated in some places and the writing might seem stilted to a teenager. There are no references to some of topics that are relevant to today's teens (like cash transfer apps) and that you might think are important (like online security, or the effect of inflation on money).

It may be more effective if you point them to the specific sections and exercises you think are relevant and use some of the other resources in the #FinLit Menu for Parents to round out the content.