Financial Literacy

A New Day in Financial Literacy

A New Day in Financial Literacy

My father’s money lessons sparked my interest in financial literacy, but I wasn’t always sure I want a career in finance. Until I grew older and saw how money consumed so many people and left them feeling miserable, rather than joyful. I realized my father’s decision to teach me about money wasn’t typical in most households, and people desperately needed to be educated about money. And more importantly, I wanted to help them.

After 20 years as a financial advisor, I’ve learned people’s views on money are shaped early, often from observing their parents, and the lack of financial knowledge is crippling people’s lives. My father waited until I turned 13 to start teaching me about money, but I started talking to my girls when they were toddlers. I wanted them to view money without prejudice and to be open-minded.

The Heavy Purse by Shannon RyanI wrote The Heavy Purse with the vision of creating a platform for parents to come together and help each other teach their children about money. Although my journey is just beginning, it’s been exhilarating to see parents start connecting the dots on how their beliefs are being passed down and the need for open communication about money.

A New Day in Financial Literacy

One thing I hear again and again is the desire for financial literacy to be taught in schools. Well, that day may finally be here. In a recent article in Time, The Council for Economic Education created new standards that establish clear financial literacy benchmarks for kids in grades 4, 8, and 12. The standards are meant to develop critical-thinking skills with real-world application and are designed to be incorporated into current classes.

It gives me great hope that financial literacy will get the recognition it deserves, and we can begin to change people’s attitude and habits towards money. At the same time, I also reminded that the best teacher still remains you. You are the person your children observe day in and day out. You are the person they mimic, not their teachers. You still need to demonstrate good financial behavior and teach your children how to make value-based decisions with their money. But soon, you may have a partner, helping your kids embrace these lessons at home and school.

Shannon

Photo courtesy www.freedigitalphotos.net.

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March 18, 2013  •  33 Comments  •  Financial Literacy

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  1. Monday, March 18th, 2013
    That's great news for schools and I hope they create a curriculum that can really teach our kids about finance.

    I'd like to see something for teens like life planning such as helping them prepare for living on their own such as searching for an affordable apartment and handling expenses. Kind of like the health class in which teens take home a baby to simulate what it would be like as a teen mom.

    I think if I would have had a taste of reality as a teen I wouldn't have left home until I was financially ready :).

    Have a great week Shannon!
    • Monday, March 18th, 2013
      I'm hoping they get a lot of hands-on, real-world experience too. Everyone handles money and the more kids (particularly teens) learn to think strategically with their money, they more prepared they will be for the real world. You have a wonderful week too!
  2. Monday, March 18th, 2013
    It is about time they teach something in school. I completely agree with you that "you" are still the best teacher for your children when it comes to money. The issue is that most people don't have good money management skills. They were not taught, so anything in school will be met with the opposite at home. Everyone needs a money makeover these days. I have a post coming up this week about a money role model.
    • Monday, March 18th, 2013
      In the perfect situation, it would be a great partnership between parents and teachers. The reality is we're a long ways from that, but I'm happy to see that personal financial education is getting the attention it needs. And I agree, a lot of parents don't teach their kids about money because their own financial situation needs a lot of work. Look forward to reading your post.
  3. Monday, March 18th, 2013
    I think this is definitely a good thing to have some sort of money lesson taught in school. As someone who wasn't taught about money by their parents, I think this is a great idea. I believe that this will help get the conversation started at home between parents and kids, if nothing else :)
    • Monday, March 18th, 2013
      Absolutely! And getting money conversations going between parents and kids is a HUGE start in the right direction.
  4. Monday, March 18th, 2013
    "At the same time, I also reminded that the best teacher still remains you. You are the person your children observe day in and day out. You are the person they mimic, not their teachers." I could not agree more Shannon! I think it's great that there seems to be some traction on teaching in schools, but where kids really learn about these things are their parents. Children, especially when younger, are like sponges and will quickly pick up how money should be treated.
    • Monday, March 18th, 2013
      Agreed! Children are sponges, absorbing everything they see us do and say. I'm thrilled our kids are going to get some financial education at school, but parents need to drive home their learnings. I find most parents don't think about teaching their kids about money, but once they are onboard, they are hungry for more knowledge and want to guide how their kids view and use money.
  5. Melinda Gonzalez
    Monday, March 18th, 2013
    Spot on. So many parents think it's the schools responsibility to mold their children, but the truth is children mimic their parents more than anyone. When they are young and their brains are developing, children create brain patterns according to what they see and those patterns become pretty hard to break later on (although not impossible, the brain is pretty plastic, but it is harder).

    I went to a pretty crappy school (called the drop out factory, seriously), but because my parents worked hard and focused on studies I did just fine in life. I naturally copied my dad's work ethic and my moms savings ethic. They never actually taught these things, but I saw them and mimicked them naturally.

    The early years are the most important ones.
    • Monday, March 18th, 2013
      I don't think many parents realize how much their kids mimic their behavior. I'm hoping with financial literacy gaining more prominence that parents will take stock of their own financial situation, particularly once their kids come home and ask them about their retirement savings, emergency funds, etc. :) And at least for those kids whose parents cannot teach their about money, they can learn there is a different and better way to handle money.
  6. Monday, March 18th, 2013
    There are two times in life when learn about money. One is from your parents when you are young. The other is when you're grown-up and you realize that you WANT to know how money works. The problem is that most people never get to that second step, and they learned it wrong the first time through!
    • Monday, March 18th, 2013
      So true! As adults we sometimes have to un-learn things we were taught as children. While I still believe parents are the best teachers, I'm hoping for those who do not have good financial role models will see there is an alternative way to handle money. And who knows? Perhaps parents will mimic their kids. :)
  7. Monday, March 18th, 2013
    I think it is great that financial literacy be taught in schools as long as it is a fun learning experience for the kids so that they enjoy it and want to participate. I remember seeing a show on TV where the kids were given a term project where the guys and girls were paired up as if they were married. Hypothetically they were given an income and they were told to find an apartment, go grocery shopping, and come up with a monthly budget. Then half way through the semester they were given a doll and were told that they new had a baby to look after so their project expanded to include the cost of their child. Most kids have no idea how much groceries or rent and other items cost, so it was a real eye opener for them.
    • Monday, March 18th, 2013
      Absolutely! They need to make fun and practical, otherwise kids will fall asleep! :) I think whenever kids can get hands-on experience of "real" life, it always surprises how much work it is to be a parent or the responsibilities of handling of money. Things they all need to learn!
  8. Monday, March 18th, 2013
    Great news, Shannon! Let's hope they teach in a way that is responsible, instead of the typical financial literacy: responsible ways to stay in debt. It's a start, though!
    • Monday, March 18th, 2013
      Oh, I hope so too, Laurie. Debt needs to be a part of the conversation, but not how to stay in debt, even if it's responsibily! :)
  9. Tuesday, March 19th, 2013
    I think that teaching kids about money in school is a great idea. I think that teaching financial literacy in high school is a must.
    • Wednesday, March 20th, 2013
      I absolutely agree, Holly. Everyone handles money and they need to understand how it works - from credit cards to savings accounts to investing to the dangers of debt.
  10. Tuesday, March 19th, 2013
    Hugely important. We can't rely on the parents to teach kids, change needs to happen at their level. I hope our kids learn some financial education in school as well as at home.
    • Wednesday, March 20th, 2013
      Financial literacy is so important. I was fortunate my father taught me about money and it's made a huge difference in my life. In an ideal world, kids would get financial education at school and at home. But this is at least a start in the right direction.
  11. Tuesday, March 19th, 2013
    I hope that actually gets implemented. Sadly, if it isn't on the state tests, it doesn't get much attention when this is really a useful life skill. I wish I'd had some finance lessons in school.
    • Wednesday, March 20th, 2013
      I hope so too, Kim. This is a subject that truly matters as every single student will have to learn how to handle money and make smart decisions. The fact that it's on the table gives me hope that financial education will become a part of our school's curriculum.
  12. Wednesday, March 20th, 2013
    I think that would be great if kids started learning that in school at an early age. I mean we learn all kinds of math...most of it that doesn't apply to most of our daily lives, yet the math that DOES apply to everyone is not necessarily taught. I hope that changes.
    • Wednesday, March 20th, 2013
      That's so true! We are taught many things in school and it makes no sense that personal finance isn't a part of that curriculum. Every student will handle money and teaching them how it works is the huge step in the right direction.
  13. Wednesday, March 20th, 2013
    I teach personal finance at our school and I am always amazed how much the students eat it up. Generally speaking, kids think school is boring but I always see them perk up when we talk about money. And it's better to educate them early about proper money management before they go off to college. That's when many of them will get into serious trouble.
    • Thursday, March 21st, 2013
      Agree 100% Brian! What grades do you teach? It makes me very happy to hear your students are enjoying your lessons. I've always been surprised by how eager kids are to talk about money, and we can make a huge difference in their financial lives by helping them understand a few basic dos and don'ts.
  14. Saturday, March 23rd, 2013
    Such great news! The best high school econ teacher I ever saw in action treated the subject as applicable to the students' lives rather than abstract graphs and charts that apply to the larger economy. He taught it as PERSONAL economy. It was really cool to watch. (Although I think that at a collegiate level all those charts and graphs are important.)
    • Monday, March 25th, 2013
      I absolutely agree. It's important to see finance from business/country/global perspective, but even more importantly, students need to learn from a personal aspect. Frankly, if a student can learn to master their own personal finances, they are a far better position to lead at a business/country/global level.
  15. Wanda Thibodeaux
    Monday, March 25th, 2013
    I think classes that look at finance are necessary, but I also think parents need to be involved and give their kids everyday opportunities to practice. Practice = habits, and good habits make it easier to become financially stable. I am already using books, chore charts, http://www.bankaroo.com, money games at the store, etc.
    • Monday, March 25th, 2013
      Thanks for stopping by and commenting, Wanda. I love getting reader feedback! I agree with you 100%. A combination of personal finance classes in school and parents demonstrating good financial behavior at home is ideal. It sounds like you're doing a fantastic job teaching your kids about money and I hope more and more parents do the same.
Shannon Ryan SHANNON RYAN, CFP®
  • Meet Shannon

    "As a Certified Financial Planner, it is my passion to help individuals and families build a healthy relationship with money. I look forward to helping you raise financially confident kids.” - Shannon Ryan
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