Financial literacy is the ability to make wise monetary decisions when it comes to things like saving, spending and investing. With April being Financial Literacy Month, this article will focus on the need, resources and tips for how we can teach youth in our community to be better prepared and accountable for their own economic success.
In the face of a rapidly evolving economy and financial marketplace, it’s vital that Americans have the tools and the knowledge to make good decisions about money. Some experts say that youth shape their opinions about money by 5th grade—so not only is it critical to start teaching money matters to youth, it’s important to start when they are young.
Did you know that only 19 states require a course in personal finance to be offered in high school? Would you be surprised to know that Illinois is not one of them? We often have volunteers tell us they go into the classroom to teach about financial literacy because they encounter many adults in their occupations who aren’t financially savvy enough to understand the basics of balancing a checkbook, budgeting, the implications of a bad credit score, how interest on loans works or the importance of saving for emergencies. They want to do their part in addressing the financial illiteracy crisis we have in America, beginning with our youth: our future!
Resources and Tips
Hopefully, by now you are wondering, “What can I do to make a difference in better preparing my own children, grandchildren and other youth in the community to be financially prepared?” Below are ideas and resources that can be used and implemented right here in central Illinois.
- The National Foundation for Credit Counseling offers a College Credit for Life Financial Literacy Video & Toolkit that can be found at nfcc.org/publications/college-credit-for-life;
- Findings from Focus Groups of LMI [low-to-moderate-income] Youth Regarding Saving and Spending by America Saves at americasaves.org;
- Understanding the Student Loan Explosion: Implications for Students and Their Families can be found at ja.org/influencer;
- Teens and Personal Finance Survey examines teens’ attitudes and behaviors around money management, also at ja.org/influencer;
- Junior Achievement $aves, with games, lessons and other resources for parents, students and educators is available at www.juniorachievement.org/web/ja-usa/ja-save-usa;
- Money Confident Kids, a web portal created by T. Rowe Price and Junior Achievement USA that contains fun games and financial literacy resources, is online at corporate.troweprice.com/Money-Confident-Kids/Site/JA; and
- Kid’s Guide to Money features additional resources to help kids learn about money in a fun way at summitcapitalfinancing.com/kids-guide-to-money.
Early and better exposure to economic and financial best practices will help our young people understand the value of managing financial tools before they become submerged in debt. If a new generation can become more finance-savvy, there is certainly an opportunity for our state and nation as a whole to become less dependent on debt. We are often troubled when we hear about our large national debt—and that foreign countries like China hold a majority of it. Yet when it comes to our own household debt, we often do the same. Teaching the basics of personal finance can culturally change our financial practices, leading to a more financially literate public and a stronger America. iBi