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Essay about financial literacy classes
Essay about financial literacy classes
The impact of financial literacy education on subsequent financial behavior
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The importance of making smart financial decisions while you are young is huge. However, many people may disagree. Students should be required to take a financial literacy class so they know how to handle money when they are on their own, stay out debt, and be able to have money saved for when they want to make big financial decisions such as buying a car, paying college funds, or even renting a house; with a financial literacy class students can learn how to save their money and be successful. “Students that have some sort of experience handling money the right way at a young age tend to carry out that trait through their adulthood years” according to Tara B Siegel Bernard. Good budgeting is something that should be maintained throughout a person’s life. “In fact many Americans are not fluent in the language of money” according to Greg Burn; that explains why many people throughout the world are bankrupted or in extraneous amounts of debts. Many Americans do not grasp the concept of budgeting or why it is important. According to Tara B Siegel Bernard, “good budgeting has to be maintained throughout a person’s life no matter the income, no …show more content…
Learning how to handle money and build a budget at a young age is a skill that requires self-control. Although I believe every student should take a financial literacy class according to Greg Burn “growing evidence suggests that the financial literacy classes do not work, worse they give graduates over confidence in skills they do not have. Financial literacy classes may not work for everyone but everyone with self-control is capable of making a budget and handling their
Once high school ends, most students progress to college after a year or two from graduation. Due to all of the expenses for textbooks and etc., the student might realize that they don’t comprehend what to conserve or spend their money on to get through their years of college which will leave them clueless on what to do next. With situations like this that might occur, all high school students should take a financial literacy class as part of the mandatory course in order to get a diploma. With a numerous amount of students not having enough knowledge about how to manage their money carefully, presumably they’ll have trouble living their life as an adult. Taking a financial literacy class would help students stay out of debt, they’ll be prepared for their future, and they would recognize the discrepancies between wants and needs.
Most kids that have graduated high school have never been educated on the subject of personal finance, so they don’t know things like how to pay bills, or even how to do something as simple as applying for a job. According to a family friend of mine, Ron Hart; who happens to also be an award-wining author and TV/radio commentator, believes that students in high school don’t learn anything about how to get a job or get prepared financially. He states that, “ Students should prepare for a job. Maybe, instead of taking a fifth field trip to the Trail of Tears site, do one to learn about real jobs in an area they might want.” Hart believes that most basic high schools aren’t teaching students how to become financially stable for their future, which can cause major issues. He claims that “few schools teach about the value of hard work, ingenuity, gumption and entrepreneurship. Those lessons are as rare as Donald Trump bumper stickers in the faculty parking lot.” Hart also goes on to talk about how high school does not prepare you for life the same way college will. There are so many more lessons to learn there that people are missing out on. College is very important due to the fact that it will teach students more skills about finance and job seeking that most high schools don’t. In college, kids will learn how to save and budget their money, pay for their own expenses, and prioritize their needs verses their wants. Learning financial responsibility is also something that kids will carry with them throughout their jobs and their life. Having more freedom to understand the concepts of person finance will allow students to make mature decisions while easing their way into real world
Also millionaires spend more time than the average American of financial research and maintaining their finances. The example of the North’s and the South’s are a good example of a good and bad budgeting example. The North’s were more frugal and strict with budgeting than the South’s. North’s live well below their means, buys used vehicles, and places a big deal on budgeting. In contrast the South’s have no control on their spending and no budget.
Public education could have done a better job promoting what happens at 17 or 18 when graduating. We were briefly advised to go to college or go into the workforce to become employees. As students, we had been told college makes you more money, and that we were all encouraged to apply. I doubted the majority of students took the responsibility to look at costs of college, tuition, and housing and understand the loans and how long it would take to pay them off. It felt that we hadn’t been taught the value of money, only that we needed to make a lot of it. I had been fortunate for working in a bank my high school years that I had understood more than others about loans, rates, mortgages, and credit cards. The financial aspect of life after high school was rarely brought
I think that making students go to personal finance classes during high school is a good thing. It educates younger people on how to manage their money and how to make purchases and that’s just a start. It will teach you how to build wealth and set a good foundation for the future.
Questions like “what is most important?” and “what is needed?” are commonly asked to help provide a focus toward where money will be spent. Having enough money for bills, food, doctor visits, fuel for vehicles, insurance, and an abundance of other things becomes a major struggle. Top priorities must be managed accordingly so there is enough money to pay for what is most important. Having a strict budget also makes it difficult to save money. For instance, if a student were to take out a loan for $15,000 then drop out and work for minimum wage, it would take over two years to pay back the loan. Acquiring a large sum of debt is never a good thing. It causes high levels of stress and fatigue. It also creates a low credit score. A good credit score is needed in order to buy a house, car, and other high price items. Debt can build as time progresses, eventually leading into a whirlpool of financial
Parents may not feel comfortable enough with their own financial situation to discuss personal finance with their children (Williams, 2009). Additionally, the parents, or other influencers, may not have a full grasp of certain concepts of financial literacy. In an article by Carlin and Robinson (2010) it was noted that “many retirement-age adults lack the financial literacy to understand the basic features of their retirement plans.” Financial literacy through socialization and practice may not be enough for students; whether it be “disadvantaged” youths who often lack a high quality of life at home, or youths whose parents have stable jobs with retirement
Today’s college students are bombarded with ads, commercials and mailings telling us that we need to spend money to be happy. At the same time, many of us come to college very ill-equipped to handle our finances. Financial literacy, defined as "the ability to use knowledge and skills to manage one's financial resources effectively for lifetime financial security," is important in our money matters as well as academic performance. Based on your understanding of financial literacy and experience (or lack thereof) of personal finance, 1) pick two personal finance topics (including but not limited to: credit cards, student loans, budgeting, saving, banking, and investment, etc.)
The general statement made by Lauren E.Willis in her work, “Should College Students Be Prepared to Take a Course in Personal Finance? No: Courses Will Miss the Real Issues”, is that personal-finance courses are ineffective in helping the students making wise decisions. More specifically, Willis argues that the information that students receive from courses is actually stereotyped and misleading, instead, federal regulations, and personal decision and experience are the fundamental solution in how to be financially success. She writes, “What’s more, even experts disagree about the right investment and retirement-savings strategies. Financial offerings change too quickly for regulators to keep up, never mind educators.”
In today’s economy, decision-making skills vary for each household; however, the bottom-line goal for every individual is to get the most for their money. In order to do this, there are 4 principles of individual decision-making: facing trade-offs, evaluating what one is giving up to obtain their goal, thinking at the margin, and responding to incentives.
Numerous amounts of people have financial problems when they get out of high school, so what should the school board do? In 2007, thirty-four out of fifty states have personal finance courses in their curriculum (Bernard 4). A financial literacy course seems to be what a majority of states are doing. Financial literacy courses have their pros and their cons just like everything else. Financial literacy courses bring up some very important questions.
Zager and Zager (2006) split the financial decision process into three parts: Inputs, process and outputs. This essay shall show the inputs, both qualitative and quantitative, process techniques and outputs of the financial decision making process. Integrity of the data is needed throughout the process, not just with the final outputs, also how different levels of accuracy are needed, and indeed can be achieved in different phases of the project.
Wise investors are concerned about the long-term health of the economy and the 'time bomb' of the ageing population, and they want to maximise the earning capacity of their money. Trulity, a provider of online DIY financial planning services, believes that the government will at some stage be overwhelmed by the burden of supporting greater numbers of retirees with a smaller number of working people. Financial misery later in life can be avoided with proper financial planning. However, many people are frightened by the cost of a full service financial planner, who financial planning software can charge you between $2,000 and $3,000 for a financial plan and then 1-2% of the value of your investment per you as an ongoing fee.
It is not enough to recognize that financial knowledge is low; we must also understand whether financial literacy matters in decision making. Addressing this question is particularly difficult because financial literacy is not distributed randomly in the population: those who possess high levels of literacy are likely to possess characteristics, such as high talents and ability, or patience, which also are correlated with financial decision making. Moreover, individuals may choose to invest in acquiring financial knowledge; thus, financial literacy itself can be a choice variable. And, it may be that those who have high wealth, rich pensions, or investments in financial markets care more about improving their financial knowledge. The inability to grasp simple concepts like calculating interest, planning a budget to live within one’s means, computing tax payments, investing wisely, discerning between competing financial offerings such as mortgages, besides other financial concepts can put individuals at a distinct disadvantage and set them on a path to financial ruin despite being
The future is always uncertain. However, having a financial plan for the future can save a person a lot of grief. More importantly, it can help tremendously for that young adult who is fresh out of college, and at the beginning stages of life; for the young adult who is preparing to attain his or her Doctorate, and will be living, most likely, completely on his or her own.