Guiding Youth Toward Financial Well-Being
October 22, 2025
As those of us in Vermont adjust to seasonal changes, we thought this would be an apt time to also look at another kind of change: how to support youth as they transition beyond the foster care system. In the piece below, we’ll look at ways to help a young person increase their financial well-being.
Guiding the Way: Teaching Financial Literacy to Youth Agin Out of Foster Care in VT
Written by Naomi Kro
Transitioning from adolescence to adulthood is a major life change for any young person, one that often comes with little preparation for the financial realities of this new phase of life. For youth aging out of the foster care system without the benefit of family safety nets, the transition brings an added layer of risk and complication. Empowering these young people with the skills they need to be financially literate, capable, and confident can mean the difference between survival and success.
As a trusted adult in the life of a young person transitioning to adulthood, you can start today by taking small steps toward their financial empowerment. Begin by introducing one financial topic at a time, making it easier to absorb and apply new knowledge. Use life milestones as natural learning opportunities—when landing a first job, talk about understanding paychecks; during an apartment search, take time to explain lease agreements. Make conversations about money a normal part of everyday life to reduce stigma and build confidence.
Below are some steps you can take to help the young people in your life become the empowered and thriving adults you know they can be.
1. Budgeting Basics
Teach them how to track income and expenses, understand what it takes to live within their means, and how to plan for and commit to long-term savings goals. Use tools like:
- Free printable budget sheets
- Apps like GoodBudget or Rocket Money
- Real-life practice, such as weekly grocery planning and regular review of spending habits
💡 Tip: Remember to budget for fun stuff too! Identify a simple savings goal that can be reached within the next six to eight weeks – maybe a shopping trip to their favorite clothing store or a new tech accessory. This quick reward will reinforce the good feeling of setting a money goal and reaching it, which in turn will help them achieve harder-to-reach long-term savings goals.
2. Banking & Saving
Help them open a checking and savings account and teach them how to reconcile their accounts on a routine basis. Many financial institutions offer accounts with young people’s needs in mind. For example, NCFCU’s “Indy” checking account is designed specifically for foster youth. Once their accounts are established, be sure to explain how:
- Debit cards work
- Overdraft fees happen
- Saving even $5/week builds a habit
💡 Tip: Work with them to reconcile their accounts weekly by using budgeting apps, Excel, or even just paper and pencil. Making it a weekly habit will prevent it from becoming an overwhelming task and will connect them to their spending habits in real time.
3. Understanding Credit
Racking up credit card debt and tanking credit scores is an all too common pitfall that young adults experience soon after becoming independent. Making sure they understand what credit is and the role it will play in their adult lives is crucial. Be sure to discuss:
- What a credit score is
- How to build credit safely
- Dangers of high-interest loans, and how to read credit card offers critically
💡 Tip: Check out the Vermont Jump$start Coalition website for workshops, classes, and other resources on this challenging topic.
4. Paychecks & Taxes
Now that they’re earning wages, it is important they understand how to read pay stubs, how employment taxes work, and what their responsibilities are come tax season. Spend some time:
- Reviewing a paystub and explaining gross vs. net income
- Explaining the difference between W2 and 1099 forms
- Exploring the free tax prep assistance offered in Vermont, such as MyFreeTaxes
💡 Tip: Encourage them to enroll in direct deposit, with a set amount or percentage from each paycheck automatically diverted to a savings account.
By breaking down complex topics into manageable lessons and using real-life situations to teach financial skills, you’re not only offering practical knowledge—you’re building trust, resilience, and long-term confidence. With your guidance and support, the young people you care about can move forward not just equipped to survive, but empowered to thrive.
- Caregiver Training & Resources – Vermont Child Welfare Training Partnership
- Podcast Library – Vermont Child Welfare Training Partnership
- Trauma Informed Practice/Parenting – Vermont Child Welfare Training Partnership
- Adoption – Vermont Child Welfare Training Partnership
- RPC + – Vermont Child Welfare Training Partnership
- VT-CWTP Publications, Annual Reports, and Newsletters – Vermont Child Welfare Training Partnership
- On-Line Learning – Vermont Child Welfare Training Partnership
