Why Do We Need To Promote Financial Literacy?
- The majority of college students say they learn the most about personal finance from their parents, but less than half of students say their parents make a consistent conscientious effort to teach them.
- Nearly two-thirds (63%) of the parents surveyed say they definitely see personal finance education as their responsibility and consistently make the effort to teach their children about it, compared to the only 41% of students who say their parents did.
- More than three-quarters of students (76%) wish they had more help preparing for their financial future.
- Parents rank developing good personal financial skills and being able to handle their money (74%) ahead of both following the wrong crowd (58%) and drugs/alcohol use (56%) in terms of concerns parents have for their children’s futures. Only personal safety ranked higher (89%).
- A recent Visa survey revealed that 91% of the respondents felt that financial education be taught in every high school.
- Nearly one-third (32%) of college students, when thinking about their freshman year, admit that they were “not at all” or “not very well prepared” for managing their money on campus. Only one in five (20%) students claims to have been “very well prepared” for managing their money on campus.
- Student Loan debt exceeds credit card debt.
- Only 14% of American adults mentioned their company’s 401(k) plan when asked about ways they save.
- Only 11% of workers under 35 years of age indicate they are participating in their company’s 401(k).
- More people declare bankruptcy each year than graduate from college.
- Nearly two-thirds (63%) of Americans acknowledge they don’t save enough, and more than a third say that they often (11%) or sometimes (25%) spend more than they can afford. More than one-in-three (36%) Americans also say that they have at some point in their lives felt their financial situation was out of control.
The Maryland Coalition for Financial Literacy (MCFL) offers help so that all schools in Maryland can adopt the State Standards in Personal Finance Education which include the following topics:
The Economic Way of Thinking:
- Choosing a Career
- Economic and Financial Decision Making
- Opportunity Cost
- Cost/Benefit Analysis
- Supply and Demand
- Human Capital investment
- Choosing and understanding benefits
- Choosing a bank and/or credit union to keep your money
- Living below your means
- How to avoid bankruptcy
Use of Credit:
- How to obtain Credit
- Using credit wisely/knowing how bad credit hurts you
- Getting a credit report
- Giving to Charities
- Debit vs Credit: Knowing the differences
Creating and Building Wealth:
- Why you need to start early and pay yourself first
- Obstacles to saving and investing
- Long term vs short term
- Insurance – auto, health, disability, and life
- Personal Property protection
- Understanding Contracts
- Identity Theft/Avoiding Fraud
- Investor/Consumer Protection