According to a report on NJ.com, eight NJ high schools are piloting a new program to teach personal finance to students beginning in the Fall. They plan to teach about budgets, saving, investing, credit cards, and debt in order to prepare these students to enter the “real world” after they graduate from high school. Of course, one thing that is missing is teaching these children how to choose the best personal finance software, in order to help them manage their finances.
According to the article:
As part of the revamped high school graduation requirements the state Department of Education unveiled a year ago, the high school class of 2014 — this fall’s freshmen — will be required to take a financial literacy course before receiving their diplomas.
There has been much publicity given to the marketing techniques of credit card companies on college campuses in the last few years. In fact, a portion of the Credit CARD Act of 2009 addressed some of these issues. However, changing the rules in order to protect our young adults is only part of the solution. They need to receive financial and economic education, so they are better prepared to make decisions that will greatly affect their future. By the time most people graduate from college they are already saddled with debt:
According to a study last year by lender Sallie Mae, 84 percent of college undergraduates had at least one credit card, and the average was 4.6 credit cards. The average balance was $3,173, and a slim 17 percent said they regularly paid off the cards each month.
In order to combat these trends, schools will add personal finance to the required curriculum:
New Jersey is one of 13 states requiring coursework in personal financial literacy for its high school graduates, up from seven in 2007, according to the Council for Economic Education. Schools can offer a semester-long course, or the subject matter — credit and debt management, planning, saving, risk and insurance and becoming a savvy consumer — can be embedded in existing business, science or social studies courses, said Janis Jensen, director of the state Department of Education’s Office of Academic Standards.
Of course I may be a little bit biased, but I believe that finance and economics should be taught in every grade from elementary through college! It’s not enough to discuss a topic a couple of times a week for a few months and think that students will be prepared to make wise financial decisions. If we begin to teach them about personal finance early in life, then they will stand a great chance of earning a debt free college education!
Besides the limited amount of time spent on the subject, one of my major concerns with this program is that many (if not most) Americans are completely clueless when it comes to personal financial management. This means that many of the teachers charged with teaching economics and finance to these students are not qualified to do so.
A few questions for you:
- Should we incorporate economics and finance into the curriculum?
- Should we start earlier than high school?
- Will this have an impact on these students?
- Should the teachers receive training before instructing in these topics?
I look forward to your comments and questions.