Eventually, everyone will need to be financially independent, including myself. Even though I come from an average household; my dad works at a bank and my mom teaches high school biology; I still do not know the fundamentals of personal finance. In a couple of years, I will be wanting to buy/rent my own house, but how am I supposed to do that with no financial knowledge on mortgages or how to take out a loan? Many of the large purchases in your adult life will require a budget and a loan. If you handle them incorrectly, it could be detrimental to your economic future. Peter Anderson from Bible Money Matters states that “...it might be a good idea to start teaching our kids the fundamentals of personal finance at an early age, before they have a chance to completely get themselves in debt, and create a situation that they’ll regret.” Personally, I do not want to have to deal with the added stress of debt in my adult life as a consequence of an incorrect financial decision I made in my adolescence. I learned the hard way that once you are in a hole of debt, it is very difficult to climb out. If someone would have told me about the benefits of compound interest and saving, then I would have started that a while ago. Now I spend most my time working so I can make money, when in hindsight I could have already had it if I would have learned the proper skills.

The United States is known as an economic world power, but what most people do not know is that U.S. citizens have accumulated a lot of debt. In a radio podcast discussing teaching financial literacy in schools, Beth Kobliner states that “Americans now collectively owe more than a trillion dollars in student loans. That is even more than we owe on our credit cards.” Kobliner also adds that “…many people entered into loans without really understanding the terms of the deal” (Kobliner). Most Americans are financially uneducated, yet they jump into financial decisions they are unprepared for, which causes financial instability. Peter Anderson discusses the lack of financial education in his article about requiring mandatory personal finance classes in high school. Anderson reveals that “roughly 2.0 to 2.5 million American citizens seek the help of a credit counselor each year, mostly to avoid bankruptcy.” He also claims that “nearly one in every thirty-five households in the United States filed for bankruptcy in 2007” and “as of April 2009 consumer revolving credit stands at $931.0 billion dollars” (Anderson). These statistics show that Americans are not financially educated, therefore the school systems should provide this knowledge within the curriculum. Personal finance courses should be taught in schools to educate the youth of financial skills that are detrimental to society’s economic future.

Personal finance knowledge can make-or-break your economical future. Certain skills that are included in personal finance, such as budgeting, balancing a checkbook, saving, investing, and how to take out a loan; are all essential to have an economically stable adulthood. Many people nowadays do not understand the importance of having good personal finance skills, yet how you handle your money will most likely determine your way of life. Today, most people do not understand that financial actions do have consequences. For example, an individual may have a steady income but if they are blowing through all their money and not saving it, the money will eventually run out. Personal finance skills can affect an individual’s future remarkably, meaning that most people should have a good grasp of financial knowledge to succeed in life. Not only would these skills benefit you and your own bank account, it will also benefit society and the nation’s economic strength. If more people are financially educated, it will improve the nation’s economy tremendously, creating a better nation for us all. 

Many young adults develop negative spending patterns throughout their teen years. Usually, when children receive money they want to spend it instantly. My seven-year-old niece obtained almost one hundred dollars for her birthday this past September, all of which were spent within the first twenty-four hours. Instead of saving some of the money for later like I suggested, my niece spent all of it at once on toys she is going to play with for a month most likely and then push aside. What she did not understand was that if she would have saved some of her money then the next time she received money she could add it together and have even more money! Children these days are not getting taught the importance of money saving and making the correct financial decisions. A recent study shows that “Nearly two-thirds of students aged 15 to 18 scored below 70 percent in the National Financial Educators Council financial literacy test, administered to 1,309 people during 2012 and 2013” (Grant). This study makes it evident that our nation’s young adults do not know simple financial skills. If schools were to offer classes to educate young adults on financial literacy, it would help prepare them for adulthood and the “real world.” If children are to be financially educated in their youth, they are more likely to financially prosper in the future.

Today, most individuals do not have a basic understanding of personal finance, and it shows in their spending habits and way of life. Some people do not believe it is a problem that individuals lack financial education, but in reality it affects the nation as a whole, not just that one uneducated individual. According to Peter Anderson, the “total consumer debt in the United States stands at nearly $2.6 trillion dollars. That works out to be nearly $8,500 dollars in debt for every man, woman and child that lives here in the United States.” It is also shown in a recent study that “only 9.4% of American students performed at the top level in a financial literacy test that included such tasks as calculating the balance on a bank statement and interpreting income tax brackets” (Frankel). The nation’s debt and the low percentage of students that know simple financial skills could have been prevented if these individuals were to have been taught correct financial skills as young adults. Now, many financially uneducated families live in debt, creating massive stress in the household. A recent survey of high school students shows that “two-thirds admitted they need to learn more financial skills” (Varcoe). This statistic could be reduced if school systems taught personal finance skills because it would ensure that every child learn these skills that are applicable to their future.

The lack of financial education affects the lives of college students the most. Since they were not taught the “rights and wrongs” of finance, they go into adulthood unprepared for what lies ahead. Anderson states that “the average college student is now more than $20,000 in debt at graduation.” Debt is something no one wants to have to deal with, but you especially do not want to have to manage it right after graduating college. This time in your life is the beginning of a new chapter. You are on your own, now with a degree and a full-time job, which gives you so many more responsibilities. The last thing you want to worry about is how much money you owe, so why not try to prevent debt by learning financial skills to help you succeed?

A main point of discussion is where children should obtain their economic information. Should it be taught at home or at school? Many people believe that the parents are who should teach their children financial skills. I agree that parents are responsible for teaching their children skills to better their future, but how are they supposed to do that if they do not even quite know themselves? Bianca Gentry claims that “..many parents do not have much financial knowledge to pass on to kids, especially those from families with lower incomes and more debt” (Gentry). If parents are teaching their children skills based off incorrect information, it could be detrimental to that child’s financial future. Parents should not be expected to teach their children skills that they know little about. It would be better to learn from a solid, organized school system than from parents babbling on and on about their past financial experiences. Most children do not even listen to advice from their parents. Most young adults do not consider their parents “cool,” therefore, the children are not going to fully listen to their parent’s advice. The information will stick with them if they are interested and want to learn something, it cannot just be forced down someone’s throat. It is unfair for today’s society to blame parents for not financially educating their children when it would be much more beneficial if it were taught in the school system.

School is designed to prepare young adults for the real world by teaching them skills they will use on an everyday basis. Personal finance should be included into the school’s curriculum because it can determine an individual’s future and it is a skill kids will use through their entire adult life. If schools began teaching essential skills needed to financially prosper, students would be gaining more insight on adulthood. Every child in the United States is required to attend school, therefore if the school systems began including personal finance in the curriculum, it ensures that every student is gaining at least a little bit of financial insight. Secretary of State Arne Duncan claims that “if our education is not keeping up with the realities of a very different economy, then I think we do young people a great disservice” (Duncan). Secretary Duncan states this because he believes that our nation should be doing more to educate the youth of financial skills and habits that will last a lifetime. A recent study shows that nearly “55.9% of students stated that they preferred to learn about money at school” (Varcoe). This study shows that children are more comfortable learning about personal finance skills in a classroom setting rather than at home. In her article “Why Financial Literacy Should be Taught in Schools,” Bianca Gentry claims that “teaching these skills in school ensures that all kids have an equal opportunity to learn about finances, regardless of their family’s financial background – thus giving all children a chance to break their parents’ cycle of poor money management” (Gentry). Teaching unbiased financial information to children in schools will help individuals avoid mistakes when making critical financial decisions. 

If schools were to begin teaching personal finance classes, they will need a set curriculum to teach to every student. This curriculum will be determined by the school board and their financial advisors. As of today, “only thirteen states require the teaching of personal finance to graduate from high school” (Frankel). To make a substantial difference throughout the nation, other state legislatures must begin requiring personal finance in schools as well. This addition will only bring beneficial outcomes to the state economy, and will give financial insight to young adults.  Having a set curriculum ensures that each student is being taught the same information. The new personal finance classes will cover a variety of personal finance topics designed to give students a good financial foundation. There are certain skills that can be considered required for adulthood, all of which include handling money. This ranges from creating a budget, to balancing a checkbook, to taking out a loan. For all this new information to be effective, the teachers will need to make the class interactive and relevant. Student’s sit in class for eight hours a day, causing some of them to mentally check-out at some point in the day. If the teacher presents the information in an interactive manner, more students will pay attention and listen. To prevent the student’s from becoming bored with the material, the teacher will want to make it relevant to their everyday life. Teach them skills they will be able to use for the rest of their life, and explain the importance of them. Most students will begin to realize the importance of the personal finance skills they are being taught and apply them to their everyday lives.

As I have stated many times, personal finance knowledge is detrimental to society, meaning that our nation could be negatively affected due to poor decisions made from financially uneducated individuals. If someone is in an ongoing cycle of poor money management, it is very difficult to escape from the financial depths. Per Secretary of State Arne Duncan, it is in “the country’s best interest to have a financially literate workforce and population” (Duncan). Duncan also states that he believes our nation would not be in such a difficult financial situation if it were not for the poor financial decisions of the uneducated. Most individuals do not understand the impact their financial decisions can make on not just their life, but the lives of everyone around them as well. 

Most people agree that money management is detrimental to society, but some others claim that schools cannot teach these skills. Dan Kadlec writes an article for TIME magazine describing why we want – but can’t have – personal finance in schools. Kadlec claims that there are four main issues hindering the teaching of personal finance. The first issue regards the teachers and their qualifications. Kadlec states that “only one in five teachers feels qualified to lead a personal finance class, according to a University of Wisconsin study. So, we do not have enough instructors” (Kadlec). Another study “..found that 89% of teachers believe that personal finance should be a mandatory class, but only 20% believe that they could competently teach that class” (Farzan). The teachers understand that it is important material, they just do not know the correct way to teach it to their students. Not only do the teachers not teach personal finance, but the standardized tests do not include these skills either. The scores you make on the SAT or ACT will help determine your future, yet they do not include financial skills that are needed on a day-to-day basis. If the information is not on the standardized test, it is not going to be taught within the school. Teachers will not waste their time teaching their students something they are not required to teach. Another issue with teaching personal finance is that education is run at the state level, meaning that each state can have their own ideas on how to go about these classes. The last issue is that “there is little academic agreement as to what kind of personal finance instruction works. Many educators are waiting for clarity before they sign on” (Kadlec). Kadlec sums up his article with the fact that our nation is making financial progress through nonprofit organizations. 

The importance of personal finance is evident, and our nation needs it now more than ever. Teachers claim that they cannot teach personal finance classes because they do not feel equipped to do so, but if it were to be taught in schools it would have to be set into a certain curriculum. Each teacher qualified to teach a personal finance course will be taught the essentials by the creators of the curriculum. The school system would obtain financial advisors to create an unbiased financial curriculum beneficial to all members of society. Standardized tests are vital to a high schooler’s life, especially if they are planning to go to college, because they are supposed to test the student’s ability to perform tasks needed throughout adulthood. Personal finance would fall under this category because it teaches the lessons, values, skills, and habits that will last a lifetime. If the state legislatures have a problem including the importance of personal finance, then bills can be passed to get around that. Personally, I do not believe that a state would turn down a program that is in its best interest. Lastly, the personal finance skills that will be taught on a school level will come from a set curriculum. This ensures that each teacher is teaching the same skills and each student is learning the same skills. Personal finance has many more benefits than consequences, and I believe each state should consider requiring it in the school system.
