- March 2021
- Vol. 22, No. 3
Ensuring the Financial Well-Being of Youth Transitioning From Care
When youth begin the transition to independent living and adulthood, it is required that they have a transition plan in place at least 6 months before their 18th birthday. It is during this time that financial education can be most beneficial. A recent article on the MoneyGeek website aims to help youth aging out of care achieve financial security and self-sufficiency by addressing the roadblocks they may face and providing solutions, resources, and tools to help them overcome those challenges.
The article lists the five financial roadblocks youth aging out of care face and solutions for each:
- Not being able to attend or afford a higher education. Youth who have recently exited care are often bombarded with additional responsibilities related to their day-to-day lives. For this reason, obtaining a higher education and a degree is often left by the wayside. The article suggests researching the financial aid opportunities for youth involved with child welfare, such as applying for the Education Training Voucher program.
- Having inconsistent financial role models. Most children learn about financial responsibilities from their parents and other trusted adults. Unfortunately, many youth exiting care do not have these positive influences nor the opportunity to learn these skills. The article suggests that caregivers and caseworkers engage these youth in financial decision-making early on and teach them how to visit businesses, government offices, and banks to solve problems.
- Experiencing greater economic hardships compared with their peers who were not involved with child welfare. Many youth who have exited care do not have enough money to pay rent and/or utility bills, have utilities shut off, and are evicted. The article suggests making sure youth learn to be financially capable by teaching them how to understand their paychecks, including taxes and other deductions; encouraging them to invest in an education; teaching them how to track their spending and live on a budget; and more.
- Having higher levels of unemployment and lower annual earnings. The article suggests joining networking sites, such as LinkedIn, to "build their brand" and feature their resumes.
- Not having a safety net from a biological family. Most youth and young adults have a parent, extended family member, or a sibling to reach out to when they need help. Having a strong safety net can help young adults get back on their feet when they experience hardship or distress. This security can allow young adults to learn from their mistakes and navigate their adult life with ease. The article suggests helping youth aging out of care develop a good support network of friends, caregivers, social workers, foster parents, mentors, and other trusted adults.
To learn more about how youth exiting care can maintain financial stability and security as they enter independent living, read the article "Financial Empowerment for Youth Who Age Out of Foster Care."