Monday, November 6, 2017

Financial Education

Most parents teach their kids about manners, good nutrition, how to drive, and hundreds of other tasks and skills that they need to learn on their way to becoming competent, independent adults. But how many families include educating their children about finances and money management in this list? Although more than half of families expect their children to be financially independent by age 21, at least 72 percent of parents express some reluctance to discuss financial matters with their children, according to a survey on Parents, Kids, and Money by the financial firm T. Rowe Price.

Clearly, parents need to incorporate money and finances in the skills and values they pass along to their children. And many of them do. But, according to the Council for Economic Education, a nonprofit whose mission is "to reach and teach every child in America about personal finance and economics"
  • More than one in six students in the U.S. do not reach the baseline level of proficiency in financial literacy.
  • Nearly one-quarter of millennials spend more than they earn.
  • 67% of Gen Y have less than three months worth of emergency funds.
Earlier this year, we wrote about several apps and tools that could help young people manage their finances. And while these can be helpful, an even more powerful tool for enabling young people to  understand and manage their financial lives is a school course focused on personal finance. While a number of states require some coursework on this subject, it is usually only a part of a larger curriculum. Only five states require a separate, stand alone course in personal finance and only 20 states require an economics course for graduation.

The Council for Economic Education seeks to address the need for financial education by providing programs and tools to help families and educators give kids the tools they need to manage and improve their financial lives. These programs include "Never Too Young", designed teach personal finance to K-5 students in after-school/out-of-school settings.

The Council for Economic Education has numerous programs for students of all ages as well as educators and districts. If your child's school does not provide financial education, this might be a good place to begin to persuade them to do so.

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