Bankruptcy Court offers students suggestions about credit

By David Flaum

April 13, 2007

This month is Financial Literacy Month and Kim Davis wants her students at Lausanne Collegiate School to get a dose of reality.

Kelly Rousseau handled that desire with CARE -- Credit Abuse Resistance Education, to be exact. Rousseau, an administrative analyst at the U.S. Bankruptcy Court in Memphis, took the program to Lausanne Tuesday and Wednesday to Davis' 65 economics students. "I'm real big into life lessons," Davis said. "These kids need to understand that life is not going to be as easy as they think it's going to be."  Personal finance has always been part of the economics unit at Lausanne "because it's engaging. It gets them (students) involved."

CARE was started several years ago by New York bankruptcy Judge John C. Ninfo II. "He saw a huge influx of 18- to 25-year-olds coming into his court and he wanted to put a stop to it," Rousseau said. With the Memphis bankruptcy court typically topping the list of the 95 jurisdictions in terms of the most filings per 1,000 residents, workers here thought the program would fit well in the area.

The court's investment here is mostly time: Rousseau, along with either a law clerk, lawyer or someone from the U.S. Trustee's office conduct the classes. The program started in Memphis in the 2004-5 school year with a program at the Memphis Grizzlies Academy, Rousseau said. They haven't been in any Memphis City Schools yet, but have conducted programs at Lausanne, Millington High School, Immaculate Conception and Houston High School this school year. Speakers touched nearly every senior at Houston, said Mike Irby, economics teacher. Their theme, he said, "this (financial crisis) happens to regular people just like them."

Often, students take more notice when they hear it from an "outsider" who has dealt with those situations rather than from people who are around the students all the time, Irby said. And the timing is right. "Seniors are going to get out and experience these things for themselves in a couple of months," Irby said. At Lausanne, each of Davis' three classes got two hours of instruction -- an hour each day.

"We cover the consequences of having bad credit, what they need to avoid, reasons for not having a credit card," Rousseau said. To do that, Rousseau divides the classes into three groups, give them personal scenarios: a college student with no credit history, a single parent with no history and a family of four with good credit. Then students build into budgets. They fill in expenses such as utilities, rent clothing and cell phone bills. "It's interesting to see how they come in over and under budget and how much they think things cost," Rousseau said. In turn, Davis said, "The program leads them to those life lessons."

Teachers interested in bringing the program to their classrooms may contact Rousseau at 328-3558.