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Teaching Money Skills on the Qualla Boundary Cherokee Reservation - 2003-12-17

Not every teenager gets a check for tens of thousands of dollars right after graduating high school. But that's what happens on the Qualla Boundary reservation, home of the Eastern Band of Cherokee Indians, in the North Carolina mountains. A casino on the reservation has brought the tribe newfound wealth. And this year, the Cherokees started teaching their young people how to use it. The students at Cherokee High School aren't the children of millionaires or industry magnates. But when this year's seniors graduate, they'll get a check for about $30,000, along with their diploma. This year's kindergartners might get well over $100,000 by the time they leave school.

The source of this largesse is Harrah's casino, which opened in the town of Cherokee in 1997. The tribe nets more than $150 million a year from the casino. Principal Chief Michell Hicks says the gaming profits have changed the economy completely.

"Prior to the casino the unemployment rates were very high, definitely in the double digits in wintertime. It wasn't unheard of to hear of 30 and 40 percent unemployment rates," he explains. Before the casino, the local economy was based mainly on subsistence farming, summer tourism and some manufacturing. Now, the can afford better health care and housing, and they're expanding their ceremonial grounds.

Besides that, the tribe's 13,000 enrolled members share in the profits personally. Each member gets an individual payment, called a 'per capita,' of about $7,000 a year. For Cherokee children, the money is held in trust and invested until they graduate high school or turn 21. Then the kids get the entire amount. And that, says Chief Hicks, is why they need to learn some serious financial management. "The earlier we can reach into the school systems, the better off the children, but also the tribe is going to be," he stresses.

Coming into so much money all at once can be overwhelming. Ellison Rudd, who works at the First Citizens Bank in downtown Cherokee, has seen that first-hand.

"I had a mother come in and she rather desperately said, 'Can you help me?' And she related to me the story of her stepdaughter, who just a year or two before had gotten her per capita. And she tried her best to get her to save some of it. And her stepdaughter said, 'No, I want to buy a car.' And she told me what actually happened is that she and her friends went on a shopping spree and spent you know, $15,000 on clothing and whatever else, and didn't even have money left over to buy a car. And she didn't want the same thing to happen to her daughter," says Mr. Rudd.

At Cherokee Middle School, he is teaching seventh graders how to invest their money. First Citizens Bank sponsors the course, and a financial education group called Junior Achievement provides the curriculum. Once a week for the past two months, the banker has taught these 12- and 13-year-olds how to budget, how to maintain a checkbook, and how to distinguish between needs and wants. Today, he's discussing the stock market.

Middle-schoolers aren't the only ones on the Qualla Boundary reservation learning about personal finance. A group called Qualla Financial Freedom teaches both elementary school children and adults. The Junior Achievement program might also be expanded to the high school.

Ellison Rudd says it's important for young Cherokees, especially, to be able to deal with the economic realities of the global marketplace with enough knowledge so they won't be taken advantage of.

"Because the wealth of the Eastern Band of Cherokee Indians has increased so rapidly, the children of the Eastern Band are going to be thrown into that worldwide market," he says. "And it is a steeper learning curve, for example, for a child here, who has been raised the way he has been raised. They're going to have to think like the world."

Seventh-grader Stephanie Taylore is starting to do that. "I'm not gonna jump in after I get out of high school and just go straight and buy me a car. I'm gonna put it to stuff that we need first," she says. "Then whatever money I have left over, I can get a car if I have enough.

Chris Davis, meanwhile, has a new set of skills. "I learned about investing and how to write checks, stuff like that. And how to fill out a job application," she says. Chris thinks she'll leave as much of her money as she can in the bank. Some of her classmates, meanwhile, have other plans for their funds. Israel Rodriguez is set on going to college. Cec Smith says her parents keep telling her to find a future off the reservation. But she's thinking about opening up her own business here.