Jason Hartman has heard it again and again—young people suffering from poor financial planning because they didn’t learn anything about it in high school or college. It’s the reason Young Wealth exists, but it’s a sad fact that today’s students graduate from programs with a severe lack of practical money knowledge. How can such critical skills required for every day survival be so neglected by the education system? Instead, learning focuses on teaching skills (albeit important ones) without providing context.
Financial literacy is important because it is a skill that doesn’t come naturally, which is to say that it must be learned. Unfortunately, family members are often bad examples. Students who study money management in high school have a decided advantage in the real world, which runs on money. This goes beyond math classes—students who see real world applications for the material they are learning will excel in money management. The earlier education begins, the greater impact it has the potential to make.
The best high schools teach financial literacy in conjunction with math and accounting classes and allow students the opportunity to practice their skills. Many implement mock programs in which students “buy” houses, cars, luxury items, with fake money and enact the potential successes or complications as they would happen in the real world. Good programs combine classroom lecture and instruction with actual practice, ensuring students get the best possible experience.
But these programs are hard to come by—few schools actually offer this sort of collaborative enrichment. When high schools fail to educate students, there are other programs that may be able to help. Often, local libraries or extension centers provide free or low cost financial literacy programs. While they’re typically geared toward adults, mature teenagers are usually welcome. These types of classes provide useful, real world information that will greatly assist an individual in financial planning.
This type of education allows a person to understand basic and complex financial concepts that occur in real life—interest calculations, risk evaluation, savings, debt management, etc. The fewer surprises students encounter when these things occur (and they inevitably will), the better. Instead of providing abstract math concepts that students fail to understand, focus education on principles and concepts meant to enhance their experience in the big, wide world and ensure a generation of people who will usher in a new, booming economy.(http://www.flickr.com/photos/billyv/3059892263/)
The Young Wealth Team