Greenlight Debit Card and App Helps Kids and Parents With Money

Piggy banks may still be useful for some — but Greenlight, an Atlanta-based debit card and financial trainer app, is aimed at kids and parents as the latter teach the former about how to grow and manage money in 2022 and beyond.

“Greenlight is the family finance company that’s on a mission to help parents raise financially smart kids,” Greenlight founder and CEO Tim Sheehan told Fox News Digital in an email exchange on Thursday, Jan. 27, 2022.

Greenlight, a start-up that’s only a few years old, today serves more than 4.5 million parents and kids. The company says families have saved more than $200 million and invested more than $10 million toward their financial futures through its programs.

Tim Sheehan is founder and CEO of Greenlight; he shared insights with Fox News Digital. He says that children can “learn to spend wisely” with his company’s debit card and app, with the help of guardrails and guidance.  (Greenlight)

“Financial literacy is one of the most important factors in our health and well-being,” Sheehan also told Fox News Digital, adding that it’s “the gateway to building a strong financial foundation for the future.”

He also that children need to understand the “difference between wants and needs. This is a financial fundamental … Once you help your kids nail this down, they can start learning how to spend wisely.”

What does the Greenlight card do?

The basic concept is simple: Teach kids how to handle money via a debit card that requires parental guardrails and guidance. After signing up for the service, parents load money onto the child’s debit card.

Kids can then use the card to make purchases virtually wherever Mastercard is accepted. Parents can also help kids set up the card to work with Apple Pay and Google Pay.

What does it cost?

The price of the basic service plan starts at $4.99 a month for up to five children. Plans that include investing for kids and parents, 1% cash back, and other premium perks are $9.98 per month.

How does the app work?

There is more to Greenlight than a debit card. Its app is useful for basic budgeting and handling transactions — and can be used for investing, too.With the app, kids can save, donate, and invest money. They can keep an eye on their balances, set financial goals, and research stocks.

The Greenlight debit card — controlled by parents — allows children to make purchases and track their spending; in addition, a companion app helps them understand how to budget for big-ticket items, and even invest. (iStock, File / iStock)

For example, a child might set a goal of earning and saving money for a new skateboard — then track his or her progress toward earning enough money to actually make that purchase.

Parents can set up the app to allow kids to experience the real-life rewards of earning, spending, saving, and investing — with a built-in cushion that prevents them from making any seriously devastating choices.

The app enables parents to put training wheels on kids’ financial habits. When the kids are ready to do it on their own, the training wheels can be removed over time.

How does the card help kids?

Young people aren’t often taught how to be financially responsible or literate — with dire consequences. Young adults may complete high school and even college without a fundamental understanding of how to earn, save, and grow their money over time.

In this image, a child is shown putting a coin into a piggy bank at home. A relatively new debit card service and app called Greenlight — five years old this year — helps children learn to use money wisely and budget for the future.  (iStock, File / iStock)

With the Greenlight app, kids learn early on to connect the work they do (such as household chores) with expanding balances — then to connect those growing balances with greater buying power.

When parents offer monetary incentives based on the quality of chores done, kids learn that work done well will be better rewarded than work done poorly. This valuable lesson will pay off when those children grow up and enter the workforce.

Though parents can put strict controls on how much a child can spend in a given category, some kids learn best by actual experience — even if that experience leads to temporary disappointment.

Some experiential learners might benefit from having the opportunity to spend a bit too much on frivolous items — then see exactly how poor choices delay the achievement of larger, more desirable goals.

Parents can allow kids just enough over-spending in one budget category to teach a lifelong lesson.

Why are adults using this card, too?

As a fintech app, Greenlight provides adults with a means of investing. “Fintech” refers to the use of technology to “improve and automate the delivery of financial services,” according to Investopedia. (Cryptocurrency, robo-advisers, and blockchain-based open banking are a few prominent examples.)

With Greenlight, parents can set up brokerage accounts to help fund college tuition, first cars, or other sizable expenditures. Families can also use the app to research investments in stocks and EFTs. How have young people improved their ‘financial literacy’ through these products?

Greenlight’s CEO Sheehan told Fox News Digital that in his view, “Gen Z is the most entrepreneurial generation to date, with 62% of Gen Zers indicating they’ve started or intend to start their own business.” He said that many “Greenlight kids” have become entrepreneurs and begun their own businesses.

Sheehan added that a 12-year-old girl used the card and app to start her own face mask business during the pandemic — and that she now donates 20% of her sales to charity. Another young person, a 14-year-old based in Alaska, used his savings from Greenlight to publish a book series, Sheehan said.

What’s the biggest mistake parents make in teaching kids about money?

“The biggest mistake parents make,” Sheehan said, “is not talking about money.” He added, “Kids and teens need to be taught that money is earned along with the importance of saving, spending wisely, and investing for the long term.”

Source: Greenlight debit card and app helps kids AND parents with money | Fox Business

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6 Tips For Conducting a Digital Literacy Assessment

Digital literacy is a skill that is a fundamental need for most institutions, especially with the amount of technology used in the world. Unfortunately, many companies and institutions are not investing enough time or money to cultivate this skill.

One way this could be addressed is by conducting what some people call digital literacy assessments. These are tests and surveys that measure an individual’s digital literacy level.

By understanding where these individuals stand, the institutions and companies will be able to craft and plan for learning programs to heighten this skill. There are a few tips to conducting these assessments that can help them go smoother and be more efficient, and below we will look at some of these.

Get Buy-In

Whenever you institute a new program, the first important thing is to get the senior members of the staff or group to get on board. This may be challenging in some cases because these senior individuals may be worried that they won’t score well.

To get that buy-in, though, it is merely a matter of having a meeting or sit down with them and showing them all the numbers that help put your new stance in digital literacy in perspective.

Show Don’t Tell

Like with anything, it is best to show these individuals how the digital literacy assessment will benefit them and their team. This means explaining to them that the more literacy they have in the digital world, the more their lives will be impacted in a good way. This can even extend to the home.

Consistency Matters

Once the assessments begin, to keep these individuals’ buy-in and make it a part of your institution’s culture, you will need to make sure they are consistently executed. Pick a schedule and use it religiously to take away your team’s stress and discomfort taking these assessments.

Cybersecurity Is Important

There are a lot of areas to cover when it comes to digital literacy. When creating your assessment, one of the most important to include is cybersecurity. Things like how to spot suspicious emails and such are essential to keep your personal info and the institution’s computer system safe. Therefore it is a vital piece of digital literacy.

Barriers to Adoption

When rolling out your digital literacy assessment, make sure to answer any push back you may get. This means sitting down and considering the barriers that individuals will put up to avoid these assessments.

Employee Resistance

The last tip we have is to go into this process expecting there to be pushed back. By expecting it, you will be able to pivot when confronted with it or pleasantly surprised when there isn’t any.

Concluding Thoughts

Having a digital literacy assessment in place is becoming a necessity if you want to run your institution at its highest efficiency and productivity. Hopefully, these six tips have helped you in your planning process.

By Matthew Lynch

Source: 6 Tips for Conducting a Digital Literacy Assessment – The Tech Edvocate

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A Finance Professor’s Advice on Investing In Bitcoin: Just Say No

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With inflation reaching 30-plus year highs, investors are looking to alternative investments to protect their capital from its erosion in case inflation is not “transitory,” but “permanent.” One popular alternative in recent years that has gained some currency is digital coins, such as bitcoin.

Bitcoin emerged in the wake of the 2008 financial crisis that led to an explosion of the liabilities of central banks. At the same time, debt issuance by private and public entities rose sharply. That brought into focus the realization that global economies had been living beyond their means. Inflation and devaluation of fiat currencies was feared.

The decrease in the trust of the banking system caused an increase in the demand for cryptocurrencies, like bitcoin because bitcoin provides the means to avoid governments and central banks.

Is this then what makes bitcoin valuable?

Bitcoin embodies two innovations: blockchain technology, a public ledger that contains all transaction records since inception, and decentralized governance. It is governed by “miners” who are incentivized to maintain a stable supply of bitcoin.

The theoretical roots of bitcoin can be found in the teachings of the Austrian School of Economics and the writings of Friedrich von Hayek, who believed that private banks should have the right to issue their own currencies.

Like gold, central banks cannot print bitcoin. And, not unlike the rarity of gold, the supply of bitcoin is fixed to 21 million bitcoins and is determined by an algorithm. New bitcoins are created after performing computationally intensive tasks that are necessary for the bitcoin system to function. However, only a limited supply of bitcoins is “mined” every year.

In light of the increased demand for bitcoins, due to the hype, media reports of rising prices, fear of missing out and uninformed speculators and the feedback loop that ensues, a severe imbalance between demand and supply has been created. That has driven bitcoin prices skyward.

However, having said that, eventually, bitcoin investors will have to ask themselves the following questions:

First, what is the value of a bitcoin? Is bitcoin money? Is bitcoin an assets class? And finally, what does bitcoin give you a right to? When I teach valuation in my classes at Ivey, I define value as economic or fundamental value, which relates to the ability of an asset to produce a stream of after-tax cash flows. What are bitcoin cash flows? None!

What is the value of bitcoin? Or better, what makes it valuable? Is it because many people think it is valuable? Is it valuable because it is cool, and we expect other people, especially those in the online community, to believe it is valuable? Does the dynamics of investor demand matter as much as fundamentals? In a recent paper by Xavier Gabaix and Ralph Koijen, the authors argue “prices move because people do things independently of fundamentals.”

In their paper titled “In search of the origins of financial fluctuations,” they explain that the amount of money entering the markets can have a large impact on share prices regardless of fundamentals. They do, however, conclude that in the long run prices return to fundamentals. But how long is long run?

Is bitcoin money? Well, it is not as it fails the three key functions of money: store of value, unit of account and medium of exchange. Bitcoin is extremely volatile, very illiquid, and unable to handle a large volume of transactions.

Bitcoin is not an asset like real estate or a stock as it generates no cash flows or expects to generate any cash flows and it is not a bond for the same reason? It also has no inherent value like gold. Gold is perceived to be valuable because it has certain unique characteristics, and attributes, like best conductor, more malleable, can be used to make tools and jewelry and can be worn and so on – we cannot do this with bitcoins.

Bitcoin has no correlation with other markets, like the stock market. For example, the correlation coefficient between bitcoin returns and the returns of S&P 500, NASDAQ, Russell 2000 and the S&P/TSX are 2%, -3%, -5% and 4%, respectively, none of which are significantly different from zero. And so, bitcoin cannot be used as a hedging instrument. Despite the bull market of 2018 and 2019 bitcoin’s value collapsed.72ecba17-6d0b-4a22-8a7e-e531c7c347c9-2-1Moreover, heavy regulation by governments weakens bitcoin’s value proposition. Many central banks have announced that they intend to launch their own cryptocurrencies. And hostile government policies against bitcoin (e.g., China) increase the vulnerability of bitcoin and reduce its attractiveness.

Every generation must learn things the hard way. It is now the turn of millennials, who love everything digital. It’s time to learn the risk of fads, be they digital or analog.

George Athanassakos

George Athanassakos is a professor of finance and holds the Ben Graham Chair in Value Investing at the Ivey Business School, University of Western Ontario.

Source: https://www.theglobeandmail.com/

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How Financially Literate Are You? 3 Things You Should Know About Your Money

How do most of us learn how to use our money wisely and well? When we’re growing up, we’re given special instruction in important subjects — swimming, driving, sex — to arm us with info and keep us from harm.

Yet when it comes to managing our money — an activity that every one of us needs to do, every day — we receive surprisingly little preparation. We’re not taught much about it in school, because education systems leave it to us to learn from our families and friends. However, those people often don’t fill in the gaps because money can be such a loaded or taboo topic.

Natalie Torres-Haddad, who grew up in southern California, saw many people around her struggling with debt and financial instability. She was determined to be the exception, and she purchased her first rental property in her early 20s and earned an MPA in Finance & International Business. In the process, however, she became buried in debt. Only by teaching herself the basics of money — basics that she’d never learned — was she able to steady herself and her finances.

Today she leads workshops and sessions to prevent others from falling into the money pit. (She’s also the author of the self-published Financially Savvy in 20 Minutes ). She’s found that even among the college-educated people she meets, “the majority feel confused and overwhelmed about balancing their income and expenses,” she says. The stats show they’re not alone. A 2015 Ohio State University study reported nearly 70 percent of college graduates in the US say they don’t feel equipped to manage money and deal with their debt.

Not only must we get up to speed on the basics, we also need to start having honest conversations with each other about money, says Torres-Haddad. In the same way we’d tell family and friends that we’re cutting out refined sugar from our diets or practicing yoga to increase our flexibility, we should be open with them about the steps we’re taking to boost our financial health.

That way, we can get advice and support. This transparency, she adds, can also make us less susceptible to peer pressure-related spending. How many of us have agreed to a pricey meal or weekend trip because we didn’t want to come clean about our money concerns?

Becoming financially literate does not require a huge time investment. Torres-Haddad believes we can start by dedicating 15 – 20 minutes a day to developing our skills and knowledge by learning new terms and resources. Just like attaining literacy in a foreign language, she says, “it’s an ongoing education.” Here are three things you need to know about your money.

1. Know How Much Money You’re Bringing in Every Month vs. How Much You’re Spending

Most of us can rattle off our salaries in our sleep, but could you do the same for your monthly after-tax income and where you’re spending your money every month? If you can’t, that’s normal. But now is the time to learn your actual take-home pay and your actual expenses (and not just ballpark figures or estimates).

For your income, look at your physical or online pay stubs, and start keeping a record of the after-tax amounts. If you’re a salaried employee, that number should be fairly steady; if you’re not, those numbers will vary.

For your monthly expenses, Torres-Haddad suggests writing down — whether it’s in a physical or online notebook — every single daily purchase (coffee, take-out, Uber, online shopping, etc) you make and every single ongoing payment you make through autopay or credit cards (Netflix, gym membership, car insurance, utilities, etc.).

If you’ve never done this before, you may find this uncomfortable — even painful — but it will force you to face up to your spending habits. It will also make these purchases visible. Often, our regular outlays (such as Netflix, Hulu, etc.) can go unnoticed or unquestioned, and our daily spends — especially if we pay by debit card so the funds are instantly drawn from our bank accounts — can go forgotten. Torres-Haddad calls the latter “runaway spending” — “when the little things that you thought cost only a few dollars actually cost much more” in the long run. Take a daily $5 green smoothie. By making them at home, you could save yourself a few hundred dollars in a month.

After you have a fundamental understanding of income and expenses, you can download an app to help you track these categories; see your bank account, credit-card and loan balances; and organize your purchases into buckets so you can identify areas where you might cut back. Two free apps to try are Mint or Charlie, says Torres-Haddad. But, she cautions, apps can be a little “out of sight, out of mind,” meaning if you need extra help to be aware of your spending, stick with the pen-and-pad (or fingers-and-keyboard) method a while longer.

2. Know Your FICO Score and Your Other Credit Scores

While you don’t need to have a good credit score to be financially literate, you must know what it is. ( Note: Most of the information in this section applies to people living in the US.) In the US, FICO was the first company to offer a three-digit credit-risk score for lenders to use when deciding whether or not to approve a loan or line of credit, a credit limit, and an interest rate. There are three other national credit reporting bureaus — Experian, Equifax and Transunion — which also keep track of all your loans (student, auto, personal, etc.) and your balances and histories for all your credit cards (whether issued by banks, stores or businesses).

However, the FICO score is the one most frequently used when you apply for credit cards, mortgages and most types of loans; rent an apartment; or sign up for utilities. FICO scores range from 300 to 850; 670 and up is seen as a good score and 800 and up is excellent. While the FICO score is calculated with a proprietary algorithm, the primary factors that go into it are your repayment history (do you pay your credit-card bills on time? how late are you?), how much debt you’re carrying on cards and loans, how long you’ve successfully held a credit card or loan for; and whether you’ve managed to hold a mix of different kinds of credit.

Most banks and credit cards offer free access to your FICO score on their mobile apps and websites ( here’s a list of the ones that do). If you don’t use one of these companies, you can also find out how to access your score on FICO’s helpful FAQ, including a chart showing where your score falls between “Poor” and “Exceptional.”

Besides checking your FICO score every year, do an annual check of the reports issued by Experian, Equifax and Transunion. This is so you can verify that they’re correct, make sure no one has opened up a line of credit in your name, and see where you might improve. You are entitled to a free copy of a credit report from each bureau once a year. Beware: Many sites will charge you a fee, so use the federally approved and secure Annual Credit Report site.

If it’s your first time checking or you’re about to make a big purchase (such as a car or a home), Torres-Haddad suggests getting all three reports at once. After that, she recommends spacing them out throughout the year. That way, you can quickly catch any errors, fraud, identity theft or any other actions that could hurt your credit history. Mark your calendar so you know when you can request your next free credit report.

3. Know How Much Credit Card Debt You’re Carrying

Knowing how much credit-card debt you’re carrying — and how quickly it’s increasing due to interest — is critical to your financial literacy. Make a list (on paper or on a computer) of each of your credit cards, their current balances, and their current interest rate. Then, put them in order from highest interest rate to lowest.

In general, says Torres-Haddad, this should be how you should prioritize paying them off, paying as much as you can towards the card with the highest interest rate while paying the minimum on the other cards. Called the “ debt-snowball method,” this was popularized by money expert Dave Ramsey.

If you have any cards that offered a 0% APR as a promotion when you signed up, mark down the date on which the promotional rate expires because that’s when you can expect your debt to accumulate at a high interest rate (20% or more). Try to budget your monthly payments so that this card will have little to no balance when that expiration date arrives.

Believe it or not, having a credit card can be a great thing for a person’s FICO and credit scores — if you use it responsibly. Of course, carrying no debt on your cards is best. Otherwise, Torres-Haddad recommends using no more than 30 percent of your available credit limit. So if you have two credit cards with limits of $6K apiece, totalling $12K in available credit, make sure the total balances you’re carrying do not exceed $4K.

If you’ve managed to pay off a credit card, congratulations. But while you may be tempted to close it, Torres-Haddad advises against it. Why? Closing the account will shrink your total amount of available credit and cause your credit score to dip. Instead, delete the card number from any online shopping accounts, cancel any auto-pays billed to it, and freeze the card in ice. It may sound silly but it means that if you want to use it, you’ll be forced to wait for it to defrost — and forced to take a little time to think about your purchase.

When choosing a new credit card, look for ones that offer incentives — such as travel points or cash back — which could help you and your finances. Torres-Haddad recommends going to nerdwallet.com and bankrate.com to compare credit card offers.

Obviously, these three points represent just a small part of financial literacy. That’s why Torres-Haddad urges people to be patient and to learn gradually. Two books she recommends are Napoleon Hill’s Think and Grow Rich!  and Robert T. Kiyosaki’s Rich Dad, Poor Dad. For those who like to get information through listening, she suggests the “Popcorn Finance” and “Her Dinero Matters” podcasts.

When you can, supplement your research with an in-person workshop, adds Torres-Haddad. “Even going to one financial literacy workshop can have a life-changing effect,” she says. A good time to find free workshops is April, which is Financial Literacy Month in the US. One of the best investments you can make in your life is to educate yourself about money, says Torres-Haddad. “It can really give you a lot of peace of mind.”

By: Erin McReynolds

Source: How Financially Literate Are You? 3 Things You Should Know About Your Money

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Young People Lying Flat Has Been A Long Time Coming

Millennials. They’re back at it again with their whining and laziness. This time, they’re daring to quit their jobs due to burnout. Don’t they understand the financial ramifications of quitting or “lying flat,” even for a brief stint? Aren’t they rather young to be burned out?

OK, Boomer.

Millennials, of which I am one, and Xennials, the cohort born from the late 1970s to early 1980s, are indeed leading the charge when it comes to the Great Resignation, or the recent increase in people quitting their jobs, according to an analysis by Visier into U.S. Bureau and Labor Statistics data. More than 6 million people quit their jobs between January and August 2021, according to the BLS’s Job Openings and Labor Turnover Survey. That was a quit rate of 2.9%, a series high.

But this shift can’t be entirely chalked up to generational stereotypes. Rather than laziness, it seems like part of what we’re seeing is a fundamental change in how people value work.

After 18 months of pandemic uncertainty altering how we work, it makes sense we’d return to the questions of why we work, and how our jobs affect our quality of life. Is there perhaps another way to earn an income that better aligns with our overall goals? Couldn’t we create a future of no longer using a career as the primary or sole basis of our identity and self-satisfaction? Shouldn’t this be a moment to consider how to work to live instead of live to work?

Granted, many recent resignations have stemmed from need as opposed to choice. For example, women are more likely to have to quit their jobs to be primary caregivers due to shuttered childcare and in-person schooling during COVID. There is also a great deal of stress around returning to work amidst an ongoing pandemic, especially if you don’t have health care. Long COVID is a growing concern. Although some have quit their jobs to hop to new positions, there are undoubtedly many who’ve quit without another job lined up.

But even before the pandemic, burnout was starting to catch up to us. A 2018 Gallup study found 7 in 10 Millennials felt some sort of burnout on the job, with 28% reporting it as frequent or constant. Whereas 21% of older generations reported feeling the same.

We can theorize that this burnout comes from the increasingly blurred boundaries between being on and off the clock. From being conditioned to believe that appearing “always available” is the hallmark of a promotable employee. From jobs that once required a high school diploma suddenly demanding a bachelor’s degree, forcing young people to get mired in never-before-seen levels of student loan debt. Perhaps too from how we were brought up — being over-scheduled as young students to pad our resumes and gain acceptance to colleges.

Millennials reportedly have higher rates of depression, anxiety and suicide compared with our Gen X and Boomer counterparts. For example, 54% of Millennials perceive their mental health as excellent or good compared to 64% of Baby Boomers, according to a 2020 report from Blue Cross Blue Shield. The same study also found a 43% increase in major depression for millennials between the years of 2014 to 2018.

Quitting a job will never be a cure-all for underlying mental health issues, but taking a short-term hiatus from a large stressor and focusing on getting better can be helpful. There may well be financial repercussions of opting out of the workforce — forgoing income is a serious consideration, as is giving up employer-provided health insurance and pressing pause on investing for retirement.

Even so, it seems millions are willing to take the risk. Reducing future earnings potential to focus on mental health may sound ridiculous to some, but figuring out how to live a stable, balanced and healthy life at a young age could reap enormous rewards for the next generation — and for our workplaces.

It’s quite possible that after decades of wealth accumulation being heralded as the route to success, we can start shifting toward a better balanced life — one in which work is just a piece of who you are and ambition and career success needn’t define you nor be what gives your life meaning. This doesn’t mean we’re without ambition, only that our desire to achieve can encompass more than the traditional, work-centric milestones.

By:

Erin Lowry is the author of “Broke Millennial,” “Broke Millennial Takes On Investing” and “Broke Millennial Talks Money: Stories, Scripts and Advice to Navigate Awkward Financial Conversations.” She wrote this column for Bloomberg Opinion.

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Source: Erin Lowry: Young People ‘lying Flat’ Has Been A Long Time Coming

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