Second graders get to be the teachers in an unusual new financial literacy program created by Pan American Bank.
The program—part of an effort by Pan American to open 14,000 children's savings accounts by 2014—gives the students training in leadership and public speaking, in addition to coaching them on basic financial skills.
The intent is to create ambassadors who share what they learn with classmates, parents and neighbors, says Jesse Torres, CEO of the $43 million-asset bank, which serves mostly Latino residents in East Los Angeles and Santa Ana, Calif.
Torres hopes the buzz created by the launch of its program at KIPP Raíces Academy will entice more schools to participate. He says teachers and administrators are often skeptical when he pitches the idea for the program. Negative headlines have made banks about as popular as spitballs with many of them.
"One of the challenges that we've come across is really getting inside the schools," says Torres.
But Amber Young Medina, founding principal of Raíces, is happy to have signed on. The three-year-old charter school serves students in kindergarten through second grade, with plans to add more grades.
Bank employees have taught financial literacy in the past, but enlisting students is a smart tactic, Medina says. "I think there's something extremely powerful about learning from their peers.
About 40 students applied in December to take part in the program's inaugural session. Participants were chosen based on recommendations and personal essays, says Torres. Many essays described unemployed parents, difficulties in saving money and other hardships.
The first 10 students accepted into the Financial Literacy Ambassador Program began in January with a tour of the bank. They attended semimonthly afterschool sessions on financial topics for three months, then began giving presentations to classmates this spring—one of the highlights for 7-year-old Jacinda Favela.
"I like to count money and teach all the first graders and kindergartners," says Favela, who wants to be a teacher and has saved about $900 for college.
Torres says the ambassadors will have a hand in educating the next group. The bank also deposits $300 into the savings account of each ambassador as a reward for completing the program.
Some other financial literacy programs involve students teaching each other. But few appear to rely on students as young as those in the Pan American program, says Laura Levine, executive director of the Jump$tart Coalition for Personal Financial Literacy, a nonprofit in Washington, D.C.
Levine was particularly impressed by the program's emphasis on leadership and public speaking as a means of spreading financial literacy. "The multiplier effect could really be promising," she says.
Torres describes the program, and the related initiative to open children's bank accounts, as a way to reach unbanked and underbanked households.
Pan American has added slightly more than 1,000 children's accounts so far. The bank funds the first $5, sets no minimum balance and charges no monthly fee before the account holder's 18th birthday.
"We've been around for 46 years," Torres says of Pan American. "And if we're going to ensure our survival for 46 more years we need to make sure that our community is economically viable. This is one of the ways that we ensure the next generation grows up fiscally sound and financially literate."
