Financial literacy is an understanding of how to earn, manage, and invest money, has a critical impact on students’ ability to make smart choices about which institute of higher education to attend, what to study, how to pay for college, and how to manage student loan debt after graduation.
The most expensive degree remains the one you don’t get
The dilemma for many schools has been that, with limited public funds to create or buy financial-education courses and to hire teachers with the proper training, they often have to rely on free material either funded or produced by financial-service companies. They also have to find space in their schedule to teach the information.
As schools evaluate financial-literacy programs, they need to be keenly aware that it’s not enough to explain the mechanics of how interest rates, investing, checkbooks, student loans and credit cards work. We need to be sending our children through courses that are free of any conflicts of interest.
RELATED: How To Teach Children To Make Smart Money Choices.
Students who are financially literate are better equipped than those who are not to make wise choices regarding school selection, what degrees to pursue, and how to pay for post secondary education. The choices students make while in school often have a direct impact on their financial futures.
Folks like having money. They just don’t like the chore of learning the concepts it takes to manage it well. And if they aren’t learning what they need to know, they probably aren’t able to teach their children.
Financial literacy may not immediately come to mind when many parents think of essential skills for students but what children know about money at a young age can shape the way they manage money in adulthood. As children develop, they are strongly influenced by what they learn in their formative years, and studies have shown the same holds true for financial matters.
Knowing the value of money is essential to financial literacy. The sooner children learn how much everyday items are worth, the better.