Family & Consumer Sciences

HOME

Kentucky High School Financial Planning Home Page

Back to E-Mail Updates page

HSFPP Weekly Update # 139—Do You Believe That Bad Things Only Happen to Other People?

Message from Bob: The LifeSmarts Consumer Program began this month, and you can learn more about it through our Website Picks of the Week. The LifeSmarts program is a fun way to reinforce the HSFPP consumer-related lessons in a game show format. Part of this week’s student activity is the LifeSmarts practice quiz. Students will enjoy it because they compete in four-person teams, with alternates, and can enjoy working with their friends.

The national LifeSmarts competition was held last spring in San Francisco and the Kentucky team from Bracken County was First Runner-Up! Students won a $600 savings bond, $100 gift certificates from Nike, and other prizes.

The teams with the highest scores in the computer competition will meet for the state competition in Frankfort, Thursday, March 2, 2006. Kentucky’s winning team will go to the national competition in Philadelphia, April 22-25, 2006.

 

Web Site Picks of the Week:

http://ag.ky.gov/cp/lifesmrt/default.htm

The Kentucky Attorney General’s Office provides this LifeSmarts consumer competition page on their Web site.

http://www.lifesmarts.org/

The official LifeSmarts Web site provides all the information you will need about the program. You can take a practice quiz and register for the competition there. They also provide tips for students and teachers. This site can also be accessed from either tips page of the Kentucky Attorney General’s Web site. Along with the HSFPP, LifeSmarts is a great way for teens to learn about consumer issues.

 

Activity for Educators:

Have students read this week’s articles In the New$.... Our work-study student, UK senior Chris Hart, wrote the introduction to these articles to help relate this issue to teenagers’ experiences. Use the discussion questions and the student activity to introduce teens to the LifeSmarts contest. Have teens go to the LifeSmarts Web site and take the practice quiz.

 

In the New$... Do You Believe That Bad Things Only Happen to Other People?

Evaluating risk is a skill that must be acquired by experience, so, of course, this is something that most teens are not in a position to do well. Many teens regularly engage in dangerous behaviors such as drinking and driving and believe they will never be hurt. Those who get away with risky behavior now may be the ones who will not plan for emergencies as an adult and will be hurt as a result. Risky behavior is a habit that is harder to break the longer it continues.

The ability to evaluate risk and plan for unexpected events in life is very important. Most teens believe they will not be involved in a car accident or get injured and need healthcare insurance. Many of my fellow college students don’t believe their apartment will ever have a fire or be broken into, but it happens quite often. Not surprisingly, most do not have renter’s insurance. Whether you make it through emergencies financially or not will depend on how well prepared you are.

Teens who marry young usually believe that they will never be the ones to get divorced, but statistics say otherwise. And divorce often leads to financial troubles. Whether it’s divorce, injury and medical bills, or the loss of a job, the new bankruptcy law will make it more difficult for individuals and families to start over, so planning for unexpected events and thinking before you act will become even more crucial in order to lessen the likelihood that you will need to file for bankruptcy.

Americans tend to be optimists and many of us do believe bad things happen to other people and not to us. Remember, however, that most families in the affected regions were not prepared for Hurricanes Katrina, Rita, or Wilma; they, too, probably thought that anything bad that happened would happen to other people and not to them. However, a recent Op-Ed article by Elizabeth Warren says otherwise.

According to Warren, “Academic research shows that about half the families in bankruptcy filings have serious medical problems. Two-thirds of those who file have lost a job or a small business. Twenty percent have just suffered a family breakup - a husband who disappeared, a wife who died, a family separated by long distances.

“Many have sustained multiple hits: illness and a layoff, divorce and business failure. Because of the hurricanes, in the next few years, bankruptcies in Louisiana and Mississippi are likely to grow at a rate that is about 50 percent faster than in the rest of the country.

“And when the crisis passes - when debtors get back to work or sweep the muck out of their homes - they will still face a mountain of bills and a ferocious onslaught by collection agencies. If those in such straits can't find a way to get current on their debts quickly, they'll face foreclosure on their homes, repossession of the cars they need to get to work and morning-to-night debt collection calls.”

“The new bankruptcy laws will surely squeeze some people harder, and they may well improve short-term corporate profits. But those laws won't solve the underlying problems of unemployment, inadequate health insurance or failing small businesses. They won't stop hurricanes or floods.” But they will hurt many “hard-working people who have been laid low by forces far beyond their control.”

So, if people are going to be forced to pay back their debts for events that were “far beyond their control,” we all will have to plan better for emergencies, save more money in case we need it, and avoid unnecessary risks.

Source: Written by Chris Hart, UK senior in telecommunications; with excerpts from: “Show Me the Money,” by Elizabeth Warren, The New York Times, October 24, 2005. Warren, a professor at Harvard Law School, is co-author of The Two-Income Trap: Why Middle-Class Mothers and Fathers Are Going Broke.

http://www.nytimes.com/2005/10/24/opinion/24warren.html?emc=eta1&pagewanted=print

 

Discussion Questions:

1.) Should people who file for bankruptcy because of medical bills or disasters like Hurricane Katrina get special consideration? Yes ___  No ___

What do you think should be done for them?

 

2.) Should all employers provide adequate healthcare coverage and pay at least 50 percent of their employees’ healthcare premiums, so individuals and families don’t end up having to file for bankruptcy because of medical bills? Yes ___  No ___

Explain reasons.

 

3.) Should the federal government establish national healthcare insurance so people don’t go bankrupt because of medical bills? Yes ___  No ___

Explain reasons.

 

4.) If the federal government institutes national healthcare insurance, should young employees be required to buy healthcare insurance to better spread the risk and reduce the cost of healthcare insurance to all? Yes ___  No ___

Explain reasons.

 

5.) For those who have federal flood insurance, do you think the government should continue to offer this coverage, paid for by taxpayers, to property owners who rebuild after a disaster? Yes ___  No ___

Explain reasons.

 

 

Activity for Students:

Register to take the LifeSmarts Practice Quiz at the following Web site:

http://www.lifesmarts.org/gameNEW/

Select your own username and password and be sure to remember them. Then take the quiz and print out your results, along with the page that gives correct answers to any questions you got wrong, and bring these to class.

 

Kentucky High School Financial Planning Program

http://www.ca.uky.edu/fcs/hsfp

The purpose of this Web site is to assist county Extension agents, credit union educators, and high school teachers in improving the economic well-being of our constituency, beginning with today’s students; and also, to assist teachers in Kentucky in meeting KERA’s goal that all students become technologically literate. Weekly Updates are provided by the University of Kentucky Cooperative Extension Service, and are free to all educators.