Northwestern Mutual

Low Employment Rate Impacts Teens’ Ability to Use Summer Jobs to Learn Money Management Skills

MILWAUKEE (BUSINESS WIRE), June 04, 2010 - Almost five million teenagers will start a summer job this year.* For most, this first job will expose teens to money – and money management – for the first time, according to new poll results by the Northwestern Mutual Foundation’s financial literacy Web site,

According to the poll results, nearly two-thirds of Americans received their first regular paycheck from a summer job (64 percent).

“Summer employment is a valuable learning ground for teens when it comes to good financial habits that will serve them well through the rest of their lives,” said financial literacy expert and Northwestern Mutual Senior Vice President Meridee Maynard. “A steady paycheck provides most teens with their first opportunity to create a real budget and stick to it.”

When asked to grade the way they managed money from their first summer job, only 20 percent gave themselves an A, saying they had a budget and saved a lot. Forty percent achieved a B, indicating they saved some money, but made mistakes along the way. The remaining 40 percent gave themselves a C or F, saying they spent a lot, if not all, of their money on unnecessary things and didn’t save much or ‘didn’t save a dime’.

“Summer paydays also enable teens to learn lessons from money mistakes,” Maynard said. “Low-dollar missteps today can help prevent more costly blunders later in life.”

Teens may combat low employment rates with entrepreneurship

This summer, more than 1.5 million U.S. teens are unemployed – accounting for one in four teenagers in the labor force* (26.4 percent). This could mean a missed opportunity for learning valuable money management skills and establishing good habits early. Maynard encourages job-seeking teens to consider being entrepreneurs, especially if summer employment is out of reach.

“The summer of 2010 may be remembered as the season of teenage entrepreneurs,” Maynard said. “With a little work and creativity, teens can launch a summer business by babysitting, dog-walking, grass-cutting and more.”

Summer Money Management Tips for Teens

Maynard has three tips for teens to manage their summer salaries.

1. Pay yourself first. Many people decide how much they can save after they look at all their usual expenses. The trick is to make savings as important as all those expenses. Teens should adopt a “pay yourself first” policy by putting away the amount they plan to save before they’re tempted to spend it. Parents can help bring the “pay yourself first” principle to life by helping teens create a budget and a money diary. Parents can also work with their kids to automatically deposit some allowance, paycheck or gift money into a savings account.

2. Set long-term goals, make a budget, put it in writing. Teens can start a “Money Diary” to list what they bought, how much it cost, and why they bought the item. and most banks have online programs that help people to categorize expenditures. The money diary will teach kids something about themselves. For example, the $5-10 a week spent on snacks can be reallocated to buy a video game or new clothes.

3. All money is really created equal. Often, teens think that the value of money changes in different situations. For example, they may be ecstatic about finding $5 on the street yet indifferent about saving $5 on a $2,000 flat-screen TV. The truth is that in each situation, teens are saving $5, and they can put that money to good use.

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About Poll

From March through May 2010, visitors to the financial literacy Web site were invited to answer two questions about the people and things that influence the way they manage money. A combined total of more than 800 respondents nationwide provided insight, and the results were then analyzed based on several demographic factors including the age, gender and location of respondents.

This poll marks the tenth in an ongoing series of polls by, with the aim of bringing continued awareness to financial literacy issues. Poll results are archived on the site and can be viewed at

Launched in 1997, is a collaboration between the Northwestern Mutual Foundation, the charitable arm of Northwestern Mutual, and the National Council on Economic Education (NCEE). The site provides fun activities, games, challenges, quizzes and tests for students and teens, helpful tips for parents, and entertaining programs and lesson plans for teachers to promote financial literacy.

About Northwestern Mutual

The mission of the Northwestern Mutual Foundation is to build strong, vibrant communities that serve as a legacy to future generations. The Foundation’s giving is designed to create an impact on the communities where the company’s employees and financial representatives live and work. In fiscal year 2009, the Foundation contributed more than $15 million to nonprofit organizations across the country.

The Northwestern Mutual Life Insurance Company – Milwaukee, WI (Northwestern Mutual) has helped clients achieve financial security for more than 150 years. Northwestern Mutual and its subsidiaries offer a holistic approach to financial security solutions including: life insurance, long-term care insurance, disability insurance, annuities, investment products, and advisory products and services. Subsidiaries include Northwestern Mutual Investment Services, LLC, broker-dealer, registered investment adviser, member FINRA and SIPC; the Northwestern Mutual Wealth Management Company, limited purpose federal savings bank; and Northwestern Long Term Care Insurance Company; and Russell Investments.

Further information can be found at

* “THE EMPLOYMENT SITUATION -- MAY 2010.” Bureau of Labor Statistics. June 4, 2010.

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6/4/2010 2:12:44 PM