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Teen spending excessive despite recession

Posted By Wendy Ma On February 10, 2010 @ 3:02 am In Features | Comments Disabled

Walking down the hallways of South, one can see students texting on their latest cell phones, talking about the video games that just came out, or wearing brand names that are “in.

“Teens don’t recognize the value of money, and there is pressure to have certain things, such as electronics, clothing, jewelry, etc., English teacher Julie Stonehill said.

The recession that began in 2007 has many families cautious of heavy spending. “Money right now is a precious resource and it doesn’t grow on trees, Stonehill said. In today’s economy, it is very hard to have excess money to spend, yet teens are spending excessive amounts of money.

According to Teenage Research Unlimited in Northbrook, Illinois, the average teen spends about 85 dollars per week, which means the average teen spends about 141 billion dollars a year.

The federal government’s survey of over 4,000 high school seniors revealed that 32 percent used credit cards, and 43 percent have access to ATM machines.

Yet the vast majority of teenagers do not understand how to compare credit cards in terms of fixed or variable Annual Percentage Rates, finance charges, grace periods, and so forth. They may have a part-time job, but they don’t understand how to manage their money.

“There is a lot of peer pressure to get the latest stuff. Everybody just wants to fit in, freshman Ana Daurio said. Kids juggle pricey extracurricular activities and hanker for high-tech gadgets.

School trips, clothes, and shoes for rapidly growing bodies, refrigerators to fill, prom dresses, piano and guitar lessons, football uniforms and cheerleading outfits, and of course the latest iPods, can altogether cost devastating amounts of money.

The media has a large influence over teens. It overexaggerates the importance of a product to a teenager, and it often advertises that in order to fit in and be socially accepted they must have said product.

Increasingly, teens have been bombarded with marketing pitches for the coolest sneakers or jeans. Especially since the economy is down, many advertisements are directed towards teens because they know that adolescents are reckless when it comes to money and that they will probably buy the item being advertised.

The financial managing and business courses at South help many students understand how to manage their money. “[The class] helps me see my options for the future so I can make the right decisions with my money, freshman Nadav Hazan said.

The class allows students to learn what the real world is like and how to deal with difficult situations that involve spending money. In those classes, students at South learn to appreciate money and it’s worth.

In order to earn money, jobs may seem like a great solution. Unfortunately, it is not as easy as it seems. Many students are busy with extracurricular activities and are dealing with stiff academic pressure to get into college; they just don’t have the time to get a job.

Financial education is vital to help teens make good decisions about their money now and in the future.

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URL to article: http://www.denebolaonline.net/2010/02/10/teen-spending-excessive-despite-recession/

URLs in this post:

[1] To drink, or not to drink? Caffeine craze hits hard at South: http://www.denebolaonline.net/2009/12/23/to-drink-or-not-to-drink-caffeine-craze-hits-hard-at-south/

[2] Econ 101: http://www.denebolaonline.net/2008/09/24/econ-101/

[3] Wall Street meets Brandeis Road: http://www.denebolaonline.net/2008/10/29/wall-street-meets-brandeis-road/

[4] Opposing Viewpoints: Question three is a solution to big government: http://www.denebolaonline.net/2010/10/28/opposing-viewpoints-question-three-is-a-solution-to-big-government/

[5] Half-Way Crooks makes its way through the recession: http://www.denebolaonline.net/2009/04/15/half-way-crooks-makes-its-way-through-the-recession/

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