What’s New In Financial Literacy?
- Increased education about financial concepts led to decreased rates of bankruptcy (Economist blog):
“Yet those who take on the most debt are the young, people who need to make large investments in education and housing, but who generally lack any experience with financial matters. Fortunately, new research* shows that courses in finance at school can help solve this predicament, reducing the harmful repercussions from taking on too much debt later in life…”
- What two high schoolers tell us about the ingredients for a successful personal finance curriculum (Kiplinger): Classes should be practical, fun and interactive and teachers should be comfortable in their role.
“I conducted my own mini survey with two young friends of mine, twin sisters Laura and Amanda. As high school sophomores last year, the girls completed a required course in personal finance. We discussed what they liked (and didn’t like) about the class, and their experience fit right in with what I’ve observed and what the research shows.”
- Study finds that our perspective on time has strong influence on our financial health (Stanford Daily):
“The recently released report, entitled “Time Personality and Financial Health Study,” reflects the results of an online survey of men and women in various age groups. Sponsored by the financial website Magnify Money, the study concluded that those who dwell on the past have the greatest propensity to make wise financial choices.”
- This is interesting..buried in CFPB report on financial literacy is a goal of creating a rubric to help educators choose among the thousands of curricular options:
“This work includes developing criteria, or a “rubric,” to help K-12 financial education decision makers and teachers select effective financial education curriculum for use with their students.”
- Will the PISA personal finance test create a tipping point for more widespread adoption of personal finance curricula in K-12 education? (NY Times)
“But the inclusion of financial literacy in PISA, considered the most important global comparison of 15-year-olds, is a sign that the subject is taking center stage in the education discussion around the world, paving the way for its inclusion in already packed primary and secondary school curriculums.”
- More financial literacy research, “Five Steps to Planning Success“, and another quiz. This study focused on five concepts the researchers deemed key to financial health: compound interest, inflation, risk diversification, tax treatment of retirement savings vehicles and employer matches. Turn to page 18 in this report and see if you can beat the average score of 11/17.
- Yes, math does matter when it comes to financial literacy (Cincinnati.com):
“In fact, the best predictor of performance on financial literacy is students’ access to and performance on conceptual-based math courses. We have known for quite some time that U.S. students’ math scores lag those of many other countries. Now we know that this math deficiency also plays a part in U.S. students’ ability to apply concepts within a financial literacy context.”
About the Author
Tim's saving habits started at seven when a neighbor with a broken hip gave him a dog walking job. Her recovery, which took almost a year, resulted in Tim getting to know the bank tellers quite well (and accumulating a savings account balance of over $300!). His recent entrepreneurial adventures have included driving a shredding truck, analyzing executive compensation packages for Fortune 500 companies and helping families make better college financing decisions. After volunteering in 2010 to create and teach a personal finance program at Eastside College Prep in East Palo Alto, Tim saw firsthand the impact of an engaging and activity-based curriculum, which inspired him to start a new non-profit, Next Gen Personal Finance.