The Importance of Teaching Financial Literacy in Schools
First For You
Why does this matter to you?
Principals — An astounding 95% of Americans wish personal finance was taught in schools. Adults are struggling with money, and they don’t want to see their children experience the same. What can you do to ensure your students become financially literate before leaving your walls? Implement a program that teaches all about money management — from debt to savings and everything in between. Show students the power that comes from handling money efficiently, and you’ll be well on your way to making a difference in the financial success of our next generation. Start teaching these skills young and consider implementing an outside program as an easy and immediate improvement.
Parents and PTAs — You want your students to succeed in every area of life. They’re already receiving top-notch education in math, literacy, science, and the arts, but what about finances? By providing students with the skills and experience to become financially literate before they reach adulthood, you can improve their future experiences with loans, credit cards, savings accounts, interest rates, and more. Bring financial education to your school, and start its lessons at a young age. You’ll quickly be amazed at the difference experiential learning in this area can create.
Partners — How can you improve the future of the next generation? Financial literacy is an excellent place to start. With such a high percentage of Americans struggling with debt and lack of savings, it’s essential that we teach children the power of money —and how to properly manage it— while they’re still in our care. Consider forming a partnership with a financial literacy program to offer these lessons in local schools today.
More About the Importance of Teaching Financial Literacy in Schools
In the past, it has seemed as if high test scores are the most important piece of American education. In recent years, we’ve witnessed a more well-rounded, life-based curriculum being taking the lead. One area that still lacks in at least half the country is financial literacy.
Why All Students Need Financial Literacy Education
nts need financial skills when they enter adulthood. Throughout these years, many young adults are:
With each of these life experiences comes financial planning — and an opportunity for financial distress. If students are not taught about credit reports, debt, savings, stock, retirement, and similar subjects in high school, they are much more likely to experience money-related challenges when they put them to use in the real world.
And current US statistics show we’re definitely doing something wrong.
This is just a glimpse into the lack of financial literacy facing our young people today. It’s worrisome, but it’s not hopeless. Each of these statistics can be improved by simply boosting the quality and quantity of personal finance education in schools.
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Tips to Introduce Personal Finance Effectively
So, teaching financial literacy in school is important. But how do you do it? The tips below are a good place to begin.
Start Early — In adulthood, habits can make or break personal finance. Research shows that our first financial behaviors begin at age 2, with a purchase request for fruit, cereal, or a toy. This continues through a natural progression of “financial firsts”, such as a child’s first bank account or first job.
Experience speaks with wisdom. When adults who are struggling state they wish students were taught these skills in school, they know it could have made a difference in their lives if they were given the same — and they know the increase in financial capability will change the world young people enter into, too.
Use Real Money — Harvard researchers have found that kids take in significantly more when they’re involved in active learning, instead of simply being told about a subject. When you give students real money to work with, they’ll carry their learnings with them for the rest of their lives.
Implement High-Quality Programming — Schools already have enough on their plates. By bringing in an effective program or platform to teach financial literacy skills, students will reap the benefits without the added stress for teachers and administrators.
If you’re looking for an engaging financial literacy platform for your students, consider FirstRoot today. We use participatory budgeting and real money to teach students about money management while making a real difference in their school. Feel free to contact us to learn more today. We’d be more than happy to bring the benefits of financial literacy education to your school.
About this article:
This article was originally posted by FirstRoot, a Benefit Corporation I founded in 2020 to promote financial literacy, financial equity, design thinking, and positive civic engagement through Participatory Budgeting in Schools.?
The approach was simple and profound: we taught kids how to manage money by giving them money to manage. The program was managed by a teacher, with the budget given to the students based on the scope of the program. A single classroom might give the students $100 to $1,000. A program that includes an entire school would often have a budget of $2,000 to $10,000. The source of these funds was most commonly the Principal, the PTA, or a corporate/non-profit organization as a sponsor. Many principals also contributed discretionary funds to the program.?
Despite being supported by many passionate investors, FirstRoot ultimately failed, as I was unable to find a viable economic model for the company.?
As part of the shutdown process, I decided to repost these articles and other relevant content from FirstRoot into LinkedIn. My hope is that they may inspire other entrepreneurs and companies to promote financial literacy, financial equity, design thinking, and positive civic engagement.