Tips from Latina Money Coach, Shay Olivarria
Recently, we had the opportunity to interview Latina Money Coach and Financial Educator, Shay Olivarria on our biweekly podcast for multicultural families. In the podcast, she answered some of our burning questions about money and financial empowerment.
Shay Olivarria is a financial education speaker, former newspaper columnist, former foster youth and author of All My Mistakes: Money lessons for emancipating youth, 10 Things College Students Need to Know About Money and Money Matters: The Get It Done in 1 Minute Workbook.
Learn more about Shay on BiggerThanYourBlock.com
LISTEN TO THE PODCAST:
Why are you so passionate about money management? What prompted you to become a financial educator to kids and young adults?
I’m passionate because of all the mistakes I made in my youth! I even named them my most recent book, All My Mistakes. I look back and think, “Why didn’t anyone tell me to invest a percentage of my income?” or “Why didn’t anyone tell me about the beauty of compound interest?”. I started Bigger Than Your Block back in 2007 because I had been working with youth and I noticed that the things I didn’t know back then, they didn’t know right now. I wanted to help them learn from the mistakes that I made.
What are some financial mistakes that you’ve made and how did you overcome them?
There are so many, where should I begin? I’d have to say that the worst mistake I made was not taking advantage of compound interest. I talk a lot about the mistakes and how to avoid them in 10 Things College Students Need to Know About Money. If I had invested only $50 per month from the time I started working at sixteen until I completed undergrad when I was about twenty six (ten years) I would have amassed $6,000. Let’s pretend that I had invested that money every month into an investment account that returned 8% per year (the average is 10% over most ten year periods, so I’m being conservative), I would have $9,000 at the end of those ten years. That’s $3,000 that was given to me because of compound interest. Let’s take it a step further and say that I never put another dollar into that account and I just let it grow. That $9,000 would turn into $217,000 by retirement! Imagine if I had kept it up!
What are some tips for parents who want to help their children successfully manage money? What Financial terms should parents and students know?
The best tip I can give is to take advantage of teachable moments. Teachable moments are those everyday conversations that pop up when you see something on tv about how celebrities spend their money or go to the store to buy groceries. There are so many situations that lend themselves to having a conversation about personal finance with your child.
Speaking of teachable moments, some great personal finance concepts to talk about include: understanding the bigger picture, critical thinking, compound interest, the P.I.L., and the 5 parts of a credit score. 10 Things College Students Need to Know About Money is a really quick read that covers all of these topics and has a glossary in the back. Don’t feel like you have to know everything about everything. You want to encourage children to figure things out. My team at Bigger Than Your Block came up with ten great conversation starters for Family Connection Club. It was harder than I thought it would be. Coming up with an open-ended question that will help create a conversation took a little bit of thinking! Just remember to ask a question and wait for an answer before telling what your opinion is. You really want to encourage your child to think through the question on their own.
How can parents help their children to overcome poverty mentalities that hinder financial literacy and hold them back from success?
There are three main things that parents can do:
- Explain choices to students. Of course there are social constructs that may be hard to overcome, but at the end of the day most of the decisions that will help them become wealthy are firmly in their control.
- Expose kids to success. Make sure that you are helping children see, hear and know about people that became wealthy through hard work and good choices. Read magazines like Inc. and Fast Company. Read books about people like Carol Burnett, Lucille Ball, and Larry Winget. Watch shows like Shark Tank and How’d You Get So Rich? with Joan Rivers. You have to make personal finance and everyday discussion. You have to show them how easy it is to become wealthy if you start early and make good decisions.
- Help them create good habits early. Provide children with four piggy banks (saving, investing, spending, and charity) and encourage them to put a portion of money they get into each piggy bank. Another great way to teach the value of money is to have your child earn an allowance. We all know that it’s harder to spend money that you’ve had to earn than money you consider a windfall.
What other steps can parents and educators take to expand their child’s professional experiences and help them network?
What a great question! It’s never too early to start thinking about how to position your child to win professionally. Have you heard of Resumes for Children? She talks a lot about helping your child develop skills and about how to present those skills in a way that builds the self-esteem of the child and helps the child be noticed professionally. Here are some more tips below:
- Get them involved with the community. The more people than your child interacts with, the more people they have to emulate. Also, the more resources they have to turn to for scholarships for sports, travel, and education costs.
- Volunteer. Having your family volunteer in the community is another great way to have them meet people. It also builds skills such as time management, responsibility, and knowing what a job well-done feels like.
- Take advantage of free resources. There are credit unions in every city that provide free financial education classes. Credit unions are great places to start building your child’s network and net worth! Make sure you speak with the YMCA and other youth development groups in your area. There are so many great resources out there once you start looking.
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