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10 Reasons Why Schools Should Be Teaching Financial Literacy To Our Kids

by Kelly Walsh on April 24, 2011


Thanks to guest writer Krisca C. Te for working with me to develop this feature post on the importance of financial literacy education for our high school and college students.

In the past, a teacher telling kids how to spend their allowance money might be promptly put in her place by the PTA. Money matters were personal, and to be kept within the family. With the increasingly difficult financial conditions bought on by recession and other fiscal challenges in the US and abroad, it would be a great time for schools to help to give our kids a fighting chance. In recent years, many academics have pushed for the introduction of financial literacy into the school curriculum.

The need to educate our kids about money is simply greater than ever. Here’s 10 reasons why.

  1. They don’t know enough. Studies by the Jumpstart Coalition for Personal Financial Literacy and the National Longitudinal Survey of Youth have shown that many young people have little understanding of finance and economics. They are spending and borrowing without knowing that interest builds up, or that credit cards aren’t free money.
  2. They are starting younger. The weekly-allowance system is used in many families. Five dollars for the candy store may not seem so bad, but pre-teens stretching $25 over one week will need a bit more guidance.
  3. There are greater temptations. A few minutes on the Internet and a kid can find more than a few toys or CDs to ask for. When they’re old enough to buy, online shopping makes it a little too easy. It’s more important than ever to tell them the value of saving and delayed gratification early on.
  4. They have more debt options. A report by the Federal Reserve showed that 53,000 student credit card accounts were opened in 2008, and by 2009 there were some 2 million student credit cards in circulation. Agreements between banks and colleges have made it easy for students to get debt— more students are paying tuition with credit cards every year in addition to charging schoolbooks and other expenses.
  5. They have more debt in general. Many college students between 18 and 25 have at least one credit card. By the time they graduate, half of them have four or more, with an average balance of over $3,000. That means they learn to take out more credit in the four or so years that they’re in college. If a financial literacy program is implemented in high schools and colleges, they could graduate with less debt.
  6. Student loans are costlier. In 2011, student loans accounted for a greater slice of the debt pie than credit cards for the first time in the U.S. While the costs of education have grown, incomes and government aid aren’t keeping up. Students are taking on more debt, and with banks tightening their belts, many of them are turning to riskier subprime lenders.
  7. People are going bankrupt younger. Bankruptcy doesn’t discriminate: in 2001, almost one in five Americans from age 18 to 24 declared bankruptcy, according to USA Today. The same age bracket is the fastest growing demographic in bankruptcy cases. Most bankruptcies are the result of accumulated debt, so people as young as 15 may already be on the road to bankruptcy.
  8. They start saving later. More kids are taking their time in school and starting their careers—and retirement plans—later than their parents. It’s not uncommon for a student to start a stable career only in his 30’s. If they learn the importance of saving and investing in high school or college, it will encourage them to get started earlier, and to work harder to avoid “taking their time” in college. This is more important then ever because…
  9. The government won’t always have their backs. With the retirement boom looming, it’s a highly likley that the next generation of retirees won’t enjoy the same benefits as their parents did from the government. More than ever, young people today are going to have to save more and invest wisely if they want a comfortable retirement some day.
  10. Not everyone is given the same chance. The Jumpstart Coalition surveys showed that the most financially literate youngsters are mostly white, male, and come from well-educated families. A separate study by the NLSY showed that financially literate young adults have parents with ample retirement savings, often invested in stocks. The data suggests that financial literacy is concentrated in the middle and upper classes, but everyone is faced with the same financial decisions. Teaching all kids in schools helps to ensure that all kids are on the same footing when it comes to handling their own money.

These resources provide support for, and excellent reading on, many of the above issues: 

What do you think? This is by no means an all-inclusive listing of reasons why we must work to offer financial literacy education in our schools. If you have additional thoughts that should be added here, please comment and share them!

Krisca C. Te is part of the team that manages Australian Credit Cards, a complimentary student credit card comparison service based in Sydney, Australia. Before she joined ACC, she was an Associate in Deutsche Bank Group under Market and Instruments Control Services.


Kelly Walsh is Chief Information Officer at The College of Westchester, in White Plains, NY, where he also teaches. In 2009, Walsh founded He frequently delivers presentations and training on a variety of related topics at schools and conferences across the U.S. His eBook, the Flipped Classroom Workshop-in-a-Book is available here. Walsh became the Community Administrator for the Flipped Learning Network in June of 2016. In his "spare time" he also writes, records, and performs original music ... stop by and have a listen!

[Disclaimer: The opinions expressed here are my own, or those of other writers, and not those of my employer. - K. Walsh]

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{ 11 comments… read them below or add one }

Lauren Thomas September 12, 2014 at 9:34 am

I believe that schools should teach financial literacy because I think that most teenagers don’t know a lot about financial literacy and it would be a great way to inform them. Also, the earlier that you start them, the more that they will know in the future and it gets them a head start on knowing about financial Literacy and it will benefit them in the future. No, not everyone is given the same chance because of the government, but if they were given the same chance this would be a great idea for them!

Tiffany Archer September 5, 2014 at 11:16 am

I agree 100% on schools providing courses to better ready students for financial stability in their futures. Maybe if I where to have taken this class before my senior year I wouldn’t have bounced my check book several times. I would have benn better prepared on managing my money throughout each paycheck received.

Cristian September 2, 2014 at 11:31 am

The ten reasons do get to the point. More school should start teaching to students about finance and economics,it will help them out in life and we might see a lot of changes if they do.

Declare Bankruptcy November 11, 2013 at 9:01 pm

This is a great article, they should teach Financial Literacy to other kids so that in the future they know how to value small amount of money and how to save money.

Amit Eshet July 30, 2013 at 11:47 pm

We as folks forget to guide our youngsters we tend toll within the ability to create cash as we target our daily activities to send our youngsters to varied tuition category in order that they will enter smart university to urge an honest degree and after all an honest job. There are many books available online that teach financial literacy to kids, Emily and Daniel’s First dollar is also a perfect book for this purpose.

david August 17, 2011 at 5:01 pm

It isnt just “financial literacy” we should be teaching – that’s another of those twisty, amorphous phrases created by academics and politico’ s.
What needs to be taught is personal wealth building for everyone, starting early. Paying taxes, managing credit and balancing checkbooks are great. But what we must teach is how to develop a lifelong plan that gets all of us to financial independence… not one that just keeps us at a minimzed debt, status quo.

Kerry Eades May 18, 2011 at 2:11 pm

I just wanted to share some resources for financial literacy:
Financial Literacy Skills Standards (free):
Assessment and Curriculum:

Michael Carabini May 5, 2011 at 8:32 pm

…….Posted on May 29 2010 by Karyn……………..We all know that literacy the ability to read and write is an important life skill. Its so important that we often create an environment at home to reflect this. We start reading to our kids from an early age years before they know how to read themselves. We surround our kids with all kinds of reading materials from books to magazines to newspapers to grocery lists. . .And then to underscore the importance of reading even more we read in front of them. Yup we pick up the newspaper or magazine and absorb the words on the pages while our kids are watching.. .When they begin to read on their own we ask them questions about the plot and characters. . .At school monthly book orders are sent home and assemblies bring in authors who talk about how they write their books. We even reward kids with stickers on classroom charts or refrigerators at home reflecting pages read. . .Its hard to grow up in an environment such as this and miss the message that reading and writing is important. .The Money Connection Theres another type of literacy which is just as important that isnt quite as integrated into our environment. Financial literacy. Simply stated financial literacy is the ability to effectively and comfortably deal with issues relating to money in a way that benefits us. Its important for things such as budgeting understanding credit and investing. .We need to be just as passionate about our kids learning financial literacy as we are about teaching them reading and writing literacy. But since financial literacy in the elementary and middle school curriculum is not where it should be were going to need to do double-duty at home. Without obsessing about money this simply means that we need to be aware of opportunities to sneak in a few life lessons.. .Here is a starter list of ways to create an environment where learning about money is simply a natural part of your everyday routine thus underscoring its importance .1. Always look for teachable moments such as being out shopping to tie in important money ideas..Kids learn to become good readers through reading. By the same token kids learn to be good money managers through doing money. Providing your kids with money to manage and initiating on-going money discussions at home will help build the financial foundation so necessary for success in todays society………………Filed under Tagged ………………….

Jennifer Cadiente April 25, 2011 at 5:49 pm

The best description of the program appears in this press release announcing when the credit union won a local education award:

K. Walsh April 25, 2011 at 2:20 pm

Jennifer – Thanks for the feedback and information. Can you provide a link that leads to content specific to your company’s student programs and branches?

Jennifer Cadiente April 25, 2011 at 2:16 pm

Great points. That is one of the things that credit unions do really well–we work to help kids learn to be responsible consumers rather than just conspicuous ones.

Maps Credit Union, where I work, runs award-winning student branches in three local high schools to help achieve this goal. The branches are run by the business and marketing classes, and they are tied strongly to the curriculum. The students who participate in the branch learn about finance, then get to teach when they have learned to their peers and to younger students. Find out more at

Although I know the cost involved to the credit union and to the schools, it seems like a good investment in our financial future. I’d love to see more innovative partnerships like this to help schools provide the lessons and share the cost.

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