by Ally L.
As a Pewaukee High School student, you are required to take either a personal finance or economics class to improve your financial literacy skills. Why is this required? "At 18 years old, kids are thrust out into a world where every step they take from graduation to retirement will be directly impacted by their financial knowledge and money management skills” (Forbes.com). No matter how well you do in school or how much money you make, if you don't have the skills to manage your money, none of this matters. If financial literacy skills are not taught in school, this sets students up to fail.
Personal Finance unlike other classes, is a class that truly is specific to each student. Unlike Math and English, personal finance will look different to each student. Every student has values that will reflect how they will manage their money. Many decisions that are financially binding will come into play later down the road, but to prepare for these decisions planning must be done in the present. Many financial decisions are made independently, and learning how to make those decisions is a huge part of life. Many big life decisions are financial decisions. For many the first big financial decision is going to college. There are many others further in life such as finding a house, getting married, and having kids.
Without personal finance education, students thrown out into the world will struggle to open a bank account, drown in student loans, and live paycheck to paycheck. With financial literacy being taught in school, students learn how to avoid these scenarios and make prosperous financial decisions.
Although personal finance is an important life tool, many U.S states do not require personal finance to be taught in school. Only "Twenty-one states now require high school students to take a course that integrates personal finance content" (cnbc.com). In Wisconsin, a financial literacy course is required in public high schools. Even though many states require personal finance it may not be making as big of an impact as some may think. Only 5 states received an A rating for their efforts to improve financial literacy.
Across the globe, the U.S is one of the least educated countries when it comes to personal finance. "On an international financial literacy test of 15-year-olds, the U.S. ranked 7th out of 15 countries, trailing China, Canada, Russia and Australia, and was just slightly better than Poland" (Champlain.edu). This makes personal finance in the U.S alone an important topic to stress to high schoolers. The U.S ranks the highest in average credit card debt compared to the top 10 countries in GDP. Teaching students in school how to use a credit card properly can drop these numbers.
Overall, education in financial literacy is continuing to grow in schools across the globe. The impact of financial literacy is the difference between success and failure for some students. For most, this education can help them excel in the future. Personal finance is taught to set you up for success in the future no matter what path you take. Without it, many students may not be able to succeed without a base in personal finance. Learning these skills in school will only benefit students for the future and continue every student's growth into the real world.
Works Cited
Erprose. “How Each US State Is Shaping the Personal Finance IQ of Its Students.” CNBC, CNBC, 5 Feb. 2020, www.cnbc.com/2020/02/05/how-each-us-state-is-shaping-the-personal-finance-iq-of-students.html.
Frazier, Liz. “5 Reasons Personal Finance Should Be Taught In School.” Forbes, Forbes Magazine, 16 Dec. 2020, www.forbes.com/sites/lizfrazierpeck/2019/08/29/5-reasons-personal-finance-should-be-taught-in-school/?sh=6df9e1e25178.
“Personal Financial Statistics.” Shift Credit Card Processing, 4 Jan. 2021, shiftprocessing.com/personal-financial-statistics/.
“Why Is Personal Finance Important: Importance of Personal Finance.” NFEC, 20 Sept. 2019, www.financialeducatorscouncil.org/why-is-personal-finance-important/.
Ashley Anderson - Your post is very insightful and detailed! I agree with you 100% that schools need to implement more courses like Personal Finance into their curriculum. Sure the standard math, english, science, and history classes teach you about life in general, but it is also important that we are learning the financial skills that are needed to support our lives in the real word. According to the Balancing Everything website, "25% of the poorest 40% are financially literate. This is a very low percentage of people who are financially literate, and it will only continue to decrease if we don't have financial literacy education. In your blog post, I find it insane that the U.S is one of the least educated countries when it comes to personal finance. This just shows how important the need is for topics related to finance to be taught in schools worldwide. Without knowledge of the basic financial principles, future generations will be unable to have a stable financial income and lifestyle in general.
ReplyDeleteAlly, your blog was a great read! I think as students we often as ourselves questions like "why are we learning this?" and "when will I need this in the real world?" I appreciated how your blog was laid out,but especially the visual graphs and charts. They really made your blog easy to read and seperated the chunks of information into smaller, bite-sized pieces. Anyway,I agree with what you said, and I'm hoping that by becoming more financially literate myself, I can avoid things like debt and living paycheck to paycheck.
ReplyDeleteI agree that classes geared towards prepping students for life on their own is super important. As I get ready for life on my own, I often find myself thinking of things that I was never taught and may need to know for when I'm off on my own. Some people don't have the luxury of asking their parents due to strained relationships or even lack of parents to put it bluntly. So yes more classes like these are needed.
ReplyDeleteI think a lot of us underestimate the importance of financial literacy. At first glance, it may look intuitive and not necessary to study in a class. But once you start studying it, you see how important it can be. In these classes, we learn basic knowledge about how the world works, and you are less oblivious to the effects of monetary transactions.
ReplyDeleteBeing a country with a reasonably high GDP, it is devastating that such a large percentage of our nation is financially illiterate. Even in the state of Wisconsin, we are considered an F. I am an econ student, but have had to learn everything I know about finances by doing my own research having never taken a finance course. However, it is so important to learn finances young so you can manage your money and not bury yourself into a hole straight out of high school.
ReplyDeleteHey Ally! I really enjoyed reading your blog post because personal finance has helped me so much in understanding how the banking system works, how to manage my money, and that I need to PAY MYSELF FIRST! I completely agree with you that this class should be required as it is very beneficial to students who are graduating and have no idea how to even write a check, considering this is a huge step people who are turning 18 have to take.
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