More financial education would have helped people better manage their money in the pandemic
Giani Clarke, 18, a senior at Wilson High School, is taking a test in her AP Statistics class. The desks are being doubled to create more social distance.
Ben Hasty | MediaNews Group | Getty Images
People wish they learned more about money in school – especially during the coronavirus pandemic.
Almost half of those surveyed said better education in financial literacy would have helped them manage their money better through the Covid outbreak, according to a study by DA Davidson. The study was conducted online and interviewed 1,047 US adults March 29-30.
Respondents generally gave low scores when it came to their own financial literacy – 36% of respondents rated themselves “C” for financial literacy, while 34% rated themselves “B”. Only 16% said they deserve an “A”.
“I was amazed at how honestly these people were transparent about this lack of knowledge,” said Andrew Crowell, vice chairman of wealth management and financial advisor at DA Davidson. “It was a pre-pandemic reality, but we believe the pandemic and the resulting financial and household burdens only exacerbated it in the minds of many people.”
The coronavirus pandemic is having a huge impact on personal finances. It’s fraught with difficulty for many – millions lost jobs or cut wages in the early days of the outbreak.
On the flip side, many have taken a break from student debt payments, and millions of Americans have now received three economic impact payments that have been used to increase savings with debt payments and more.
Even those unaffected financially by the pandemic may not be sure how best to manage their money to take advantage of stimulus payments and prepare for the future.
More from Invest in You:
For a few days, some companies cost thousands of PPP loans
Disabled Americans could save their incentive money in this account
Op-ed: Black women have to do their own magic with their finances
This Wall Street veteran wants to bring diversity to the American company
The survey found that young adults felt that their financial literacy was particularly poor in school. More than 70% of Generation Z respondents said better financial literacy would have helped them better manage their finances amid the coronavirus pandemic, compared to 47% among all respondents.
Additionally, 30% of Gen Z said the financial topic they least understood was debt management, which lagged behind investments, insurance policies and coverage, and came up with a financial plan.
“It’s horrible that financial literacy has been removed from the school curriculum,” said Crowell. “We just send our children into the world unprepared.”
Currently, only 21 states require high school graduates to take a personal finance course, and for many it’s part of a different class. In 24 states, high schools are required, but not required, to provide personal finance education.
According to the study, this does not agree with the opinion of the population. Nearly 90% of respondents said that personal financial education should be part of K-12 education, and 45% said that children between the ages of 11 and 15 should start learning about money management.
Meanwhile, 7% said children under 5 should be taught personal finance, and more than a quarter of respondents said financial education should begin between the ages of 6 and 10.
Ability and ability
The coronavirus pandemic has also changed some aspects of personal finance education in schools, resulting in many online resources and courses that students can take to expand their knowledge.
One of them is Next Gen Personal Finance, a nonprofit that curates the best content on the web to help educators find resources to improve both financial literacy and skills, according to Yanely Espinal, director of Education Outreach.
The skill piece is important, according to Espinal. “Studies show that at the end of the day, if your behavior doesn’t change, what’s the point of reading a million articles?” She said.
This includes tailoring the training based on the age of the students and teaching them to ask the right questions in money-related situations such as: B. when they open a bank account in person or online or buy their first car.
Espinal also said part of the struggle is getting students to talk to their parents at home about what they are learning in school, including money classes. It can be very helpful and so easy when children are involved in small, age-appropriate activities that show how money works.
REGISTRATION: Money 101 is an 8-week financial freedom learning course delivered to your inbox weekly.
CHECK: How to make money doing creative side businesses, from people who make over thousands on sites like Etsy and Twitch Grow with acorns + CNBC.
Disclosure: NBCUniversal and Comcast Ventures are investors in Acorns.