SAN JOSE, Calif. -- Meriwest Credit Union has recently unveiled a pilot program designed to provide student budget training.
The program, Real World Budgeting, was launched with participation of nearly 400 seventh grade pre-algebra students at Windemere Ranch Middle School in San Ramon.
The simulation program assumes the students are college graduates who are venturing into the job market and required to live independently. The students are given a job with a salary and then challenged to live within their means and replenish their savings account while managing a car, an apartment and the other necessities of independent living.
"Real World Budgeting is just that; it challenges the students to make some tough choices that they normally wouldn't be exposed to. Do they want to be flashy and drive a sports car or be thrifty with a modest economical car?" said Greg Meyer, community relations manager with Meriwest CU. "As they get closer and closer to going over budget, it becomes more difficult to justify money for entertainment and eating out when you need it for necessary items like rent, groceries or apparel."
The students learn to make some financial sacrifices in order to maintain a comfortable yet modest lifestyle. At the same time, the trainers impress upon the students the need to pay yourself first by treating their savings accounts as a bill; the first bill paid after rent. In nearly every simulation run in the classrooms, students preferred to take money from their apparel budget or other discretionary funds rather than use money from their savings budget.