5 Reasons Personal Finance Should Be Taught In School
Having basic personal financial skills is one of the most important things you can do to live a healthy, happy and secure life. Your level of understanding around the fundamentals of budgeting, saving, debt and investing will impact every part of your life and can mean the difference between prosperity or poverty.
With how important these basic life skills are, it's shocking that only 17 states require students to take a high school course in personal finance. High schools teach Geometry, Art, Latin, and Home Economics—all valuable to know for sure. But how often on a day to day basis do you need to calculate the area of a trapezoid? Personal finance is a necessary life skill that must be taught in schools. Here are five reasons why:
1. Money touches everything
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. Career decisions, buying your first house, getting married, having children—finances all play a massive role in each of these life events. And it's not just the major ones; finance is a part of our everyday life. Whether it's where we eat, what we buy, traveling, going out with friends or negotiating prices, every day we are faced with financial decisions. Young adults lack the experience and education to make these decisions - big or small.
2. The Majority of Americans want personal finance taught in schools.
When it comes to financial education in schools, many adults feel that more should be done to help students get a head start. A recent Credit Karma/Qualtrics survey found 63% of respondents think personal finance education should be taught in schools. Although nearly two-thirds of Americans are in agreement of the importance of finance in our schools, respondents were a bit divided over when this should happen.
Despite some debate over just how young is too young when it comes to learning about personal finance, or where that education should occur, the study shows many Americans are aligned on putting school-sponsored personal finance education on the political agenda. More than three-quarters (77%) of those surveyed believe politicians should push to add financial education in schools, and 67% of those surveyed would prefer to vote for a candidate who prioritizes adding mandatory personal finance education to the public school curriculum.
Additionally, there’s a lot that Americans would be willing to give up to receive better financial education, including happy hour (35%), dating apps (29%), morning coffee (24%), vacation days (12%) and even their sex lives (8%).
3. Lack of financial knowledge has painful consequences
Finances are understandably one of the major causes of stress for adults. Everyone can relate to this stress; even the wealthiest people have felt financial pains at one time or another. Debt and/or a lack of savings can cause considerable hardship on a person’s life. And it doesn’t just cause daily stress. Financial problems can lead to divorce, poor health, depression, and bankruptcy.
The statistics below show that plenty of adults are feeling the pressure of financial issues. Many of these could be avoided with some basic knowledge.
4. Financial literacy leads to a healthier life
More than half (51%) of millennial respondents surveyed answered that they feel their level of personal finance knowledge is holding them back from making financial progress, compared with just 43% of Gen Z and 26% of Gen X and older. And, they are right - it is holding them back from their full potential. The positives that come with having a financial education are undeniable, such as:
5. Where else will they learn it?
The study showed that in lieu of school-sponsored personal finance lessons, many Americans turn to alternative sources of money advice and information. For example, 41% of respondents said they’re self-taught, while 37% said their parents taught them about finances. Just 12% said they learned about personal finance from teachers.
This article originally appeared here