Dealers help promote financial literacy

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With briefcases stuffed with lesson plans, interactive finance timelines and even cardboard models of banks, female dealers and other auto industry leaders are spreading financial literacy to educate car buyers of tomorrow.

Women on the National Automobile Dealers Association’s board of directors have made community outreach through financial literacy an objective. Starting financial education in schools, even as early as kindergarten, is vital, said Ivette Rivera, NADA’s senior vice president of legislative affairs.

“If you don’t get to people early enough, they may be making [bad credit] decisions down the road.”

And that hurts those consumers and the economy.

“So many of our issues come down to vehicle affordability,” Rivera said. “With what we lived through during the recession, we thought it would make a great impact.”

In states that require financial education in high school, young adults have higher credit scores and lower delinquency rates on credit cards and car loans, according to the State Mandated Financial Education and the Credit Behavior of Young Adults, a 2014 study by experts from the Federal Reserve Board, University of Wisconsin and Montana State University.

Of Georgia students who received financial education in school, three years later their credit scores were 29 points higher on average than scores of consumers from comparison states with no financial education, the study said.

The results made an impact on NADA’s female directors. Last year they formed the Women Dealers Financial Literacy Project, led by Ohio dealer and NADA board member Michelle Primm. The project is still in its infancy. So far, it has partnered with programs such as Junior Achievement, MoneySkill and Wallet Wise to help educate their communities.

Rivera: Wants to make an impact

MoneySkill is an online personal finance course for students from the American Financial Services Association Education Foundation. It includes 36 adaptable modules to customize the course for a specific student or class. 

Wallet Wise is the brainchild of Ally Financial Inc. The program teaches the basics of budgeting, banking and investing, credit and auto finance online or in person. Online classes offer convenience, but there is a clear benefit to in-person lessons, says Jacqueline Howard, director of corporate citizenship at Ally. “Money is one of those topics where people are uncomfortable. If you can make the audience comfortable it makes the in-person classes really impactful,” she said. 

Consumers may not understand how car buying works, but through the Women Dealers Financial Literacy Project, dealers can educate the community. It won’t solve the financial literacy problem but may “make a dent in it,” Howard said. 

Rivera volunteers with Junior Achievement, a K-12 program to promote students’ work-readiness, entrepreneurship and financial literacy. For example, in kindergarten youngsters are taught the difference between a need and a want. High schoolers get lessons in finance. 

Junior Achievement gave Rivera supplies for teaching fifth-graders about trade, globalization and entrepreneurship. “You have the material for every class,” she said. “They were so interested.” 

Primm, managing partner of Cascade Auto Group in Cuyahoga Falls, Ohio, started speaking to high school students about finance 15 years ago. She saw the need for financial education in her community, but “it’s hard to start a movement from scratch,” she said. So after the women on NADA’s board identified the need for outreach, she began working with Junior Achievement. 

Primm: 15 years of volunteering

Primm volunteered for the five-session personal finance program that taught high school students about earning money, budgeting, saving and investing, using credit cautiously and protecting personal finances. Many of the students hope to be the first in their family to attend college, said Primm, who in 2015 was named one of Automotive News’ 100 Leading Women in the North American Auto Industry.

Michael Gaffney, president of Junior Achievement of North Central Ohio, said he has a great volunteer base through Primm. “With dealership personnel volunteers, the students can get a glimpse of different people playing different roles in their community,” he said. Often when students visit dealerships, they only see the sales team. But through Junior Achievement, they talk with finance managers and sometimes even a mechanic. The dealerships’ volunteers help students to “think about jobs in every industry,” he said. 

Students’ financial literacy benefits dealerships in the long run. Primm wants to encourage dealers to find their path in their community. “Dealers really want and embrace educated consumers,” she said. “It makes the whole sales process easier.” 

A better credit score, Rivera added, means better options for a vehicle. “It just gives people more options.”

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Dealers help promote financial literacy