We live in a time when teaching financial responsibility to children and young adults is increasingly important. In fact, data from the Federal Reserve shows that 40% of American Households cannot withstand a financial emergency of $400 or more.
While it’s likely that no one will argue that financial education is vital to kids growing up to be economically successful adults, there is sometimes debate on who should teach them these skills. Historically, the skills of financial literacy have been taught by parents based on the family’s values and resources. What happens, however, when parents don’t have the financial literacy knowledge to pass on to their children? A 2016 study by FINRA reported that 60% of American adults have not been offered financial education by a school or employer, and even fewer have taken advantage of the education offered.
Kids Need Financial Education
A 2011 Charles Schwab survey revealed that of the 1,132 teens between 16 and 18, that were surveyed, 42% stated they wanted their parents to talk more about finances and money. A mere 32% of these teens stated they knew how credit card interest and fees work. For a group of teens and young adults who are nearing the end of their high school career, these kids are in jeopardy of struggling on their own financially when they enter college or the workforce.
It makes sense that financial education is taught in schools along with the standard core subjects of English, math, and science. Teaching financial concepts in the classroom is one promising way to improve financial capability and economic success for young people and ensures that all kids have an equal opportunity to learn about finances, regardless of their family’s financial background or experience.
- More than half of states don’t require high school students to take an economics class.
- Only 17 states require high school students to take a course in personal finance.
- Studies show that students without a financial education are more likely to have low credit scores and other financial problems.
Financial literacy education in schools may look like:
- Provide teachers with support and training to teach the skills needed
- Integrating financial education with hands-on practice
- Improving or introducing education standards
What Can We Do?
We may not be able to change the laws and education standards for our entire state, but we can push for financial education in local schools. Parents and family members can be effective in creating change in their childrens’ schools. Consider going to your child’s school and asking how financial education can be incorporated into the curriculum. Parents should not be afraid to ask for a required class on financial literacy.
And if your local schools aren’t offering the education needed, we need to take ownership of making sure that our children get the information they need. Parents can talk to their children about planning for the future and caring about money. Websites like econedlink.org offer resources for parents and educators, such as video lessons on the federal budget and unemployment.
Financial education can make a difference. It can empower and equip young people with the knowledge, skills and confidence to take charge of their lives and build a more secure future for themselves and their
families. We can be part of the solution.
Consumer Education Services, Inc. (CESI) is a non-profit committed to empowering and inspiring consumers nationwide to make wise financial decisions and live debt free. Speak with a certified counselor for a free debt analysis today.