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Capital One's Annual Back to School Survey Finds More Teens Eager To Learn About Money, Yet Parents Continue to Overlook Simple Opportunities to Talk Dollars and Cents

July 16, 2007 at 8:02 AM EDT

Back-to-School Shopping Provides Opportunity for Teaching Practical Money Skills

MCLEAN, Va.--(BUSINESS WIRE)--July 16, 2007--Capital One Financial Corporation's (NYSE:COF) seventh annual back to school shopping survey shows that an increasing number of teens (52 percent) want to learn about how to manage their money - up from 49 percent in last year's survey. In addition, 80 percent believe learning the basics of money management now will serve them in the future - yet a whopping 86 percent have never taken a personal finance class in school. Yet when it comes to talking to kids about the basics of money management, parents still aren't hitting the mark, despite the fact that 35 percent of teens want to learn about money from their parents over any other option.

"Now more than ever, we're seeing that teens are eager to learn about money - and the good news is that they want to learn from their parents," says Lahne Mattas-Curry, financial education spokesperson for Capital One. "Back to school shopping is often overlooked as a financial education opportunity, but it's a great way for parents to teach kids about the basics of money, including how to prioritize needs vs. wants and create a budget."

This year's survey of 1,200 parents and teens also finds that while most parents (80 percent) continue to view themselves as positive money role models for their kids, less than half are taking advantage of day-to-day learning opportunities to initiate a dialogue with their kids:

  • Fifty-two percent of teens are eager to learn more about money management, yet less than a quarter (19 percent) of parents have discussed back-to-school budgeting with them - and only 22 percent have made a list of back-to-school items to purchase.
  • While almost half (48 percent) of parents have discussed the difference between 'needs' vs. 'wants'; more than one-third (36 percent) have not discussed back to school finances at all with their teens.

    Capital One's survey also found some surprising facts about what teens are most interested in learning when it comes to money, as well as insight into back to school shopping lists and planned spending amounts.

    What are teens interested in learning?

    When asked about the topics they'd most like to learn about, teens expressed interest in all areas of money management. Surprisingly, they show the most interest in learning how financing works for large purchases such as a car or a home - 74 percent said they would like to learn more. Other popular interests for teens include learning more about investing money (72 percent), identity theft and how to protect themselves (68 percent), saving money (62 percent), budgeting (58 percent), stocks (58 percent), checking accounts (55 percent) and credit cards (55 percent).

    What are they buying?

    Clothes and traditional school supplies such as notebooks, backpacks, pens and pencils continue to top back-to-school shopping lists this fall. Just seven percent of parents and teens expect to purchase hand-held electronics such as PDAs or iPods, compared to 10 percent who planned to purchase these items last year. Parents and teens still differ slightly on computer spending - four percent of parents expect to shop for a new a computer this year, while seven percent of kids hope to do so.

    Are parents going with their teens to shop? How much are they spending?

    Ninety-three percent of teens expect their parents to join them on back to school shopping trips. This year, 52 percent of parents expect to spend more than $125 on back to school essentials for their kids, while 27 percent plan to spend less than $100. Overall, the majority of parents (72 percent) say they will be spending the same amount as last year; however, 16 percent plan to spend more. Most plan to pay with cash (69 percent) and credit (33 percent).

    Are teens contributing to the bill?

    When it comes to sharing the cost of back to school shopping, 51 percent of teens plan to contribute to the bill, with almost 60 percent responding that the money will come from job earnings. Teens say the remainder will come from allowance savings (29 percent) or a cash gift (21 percent).

    Financial education: What parents and teens can do to shop smart

    "Parents can use back to school shopping to start a conversation and reinforce basic money management skills with their teens," added Mattas-Curry. "There is a wealth of free financial education information online that parents and teens can use to get started planning - but the most important thing is simply to get involved."

    Capital One offers parents tips for working with their teen to develop good money management skills:

  • Make back to school shopping a family affair: It's a great opportunity for kids to learn valuable hands-on lessons from their parents.
  • Do your homework: Talk to teachers in advance and try to get a list of required school supplies so you can buy in advance (maybe even on sale).
  • Crunch numbers together - establish a budget: Determine how much you're able to spend in advance and stick to the amount.
  • Make a list: Prepare your shopping list in advance. Try to distinguish between "needs" and "wants" on the list and prioritize the needs first.
  • Shop smart: Make sure you shop around for the best price and the best quality.
  • Get more tips (if you need them): Capital One offers a number of resources on budgeting and savings and has partnered with the national consumer organization Consumer Action to create a complete guide for parents called Talking to Teens about Money, available at www.money-wise.org.

    For additional help, parents and students can visit the Jump$tart Coalition for Personal Financial Literacy home page at www.jumpstart.org and search the "clearinghouse" for financial curriculum and education materials.

    Survey Methodology

    For the Capital One Study, Braun Research was engaged to conduct 1202 interviews in 857 households with 698 parents of teenagers age 13 to 17 and 504 teenagers age 13 to 17 across the United States. Surveys were conducted by telephone from July 3rd through July 9th, 2007. The margin of error for the interview is plus or minus 3.34 percentage points. Interviews were monitored at random. Sampling for this study was conducted across the United States using a national probability sample of all exchanges and area codes of households with someone between the ages of 13 and 17 living there. All interviews were conducted using a computer-assisted telephone interviewing system. Statistical weights were designed from United States Census Bureau statistics.

    About Capital One

    Headquartered in McLean, Virginia, Capital One Financial Corporation (www.capitalone.com) is a financial holding company, with more than 720 locations in New York, New Jersey, Connecticut, Texas and Louisiana. Its principal subsidiaries, Capital One Bank, Capital One, F.S.B., Capital One Auto Finance, Inc., Capital One, N.A., and North Fork Bank offer a broad spectrum of financial products and services to consumers, small businesses and commercial clients. Capital One's subsidiaries collectively had $87.7 billion in deposits and $142.0 billion in managed loans outstanding as of March 31, 2007. Capital One, a Fortune 500 company, trades on the New York Stock Exchange under the symbol "COF" and is included in the S&P 100 index.

    CONTACT: Capital One Financial Corporation
    Lahne Mattas-Curry, 703-720-2358
    lahne.mattas-curry@capitalone.com

    SOURCE: Capital One Financial Corporation