VIEWPOINT
Financial literacy is more important than young adults realize far too late. In a state that requires personal finance courses before high school graduation, it makes you wonder where the education is going.
In light of tax season rearing its head and April being National Financial Literacy Month, I think it’s fitting to discuss the lack of urgency surrounding the importance of Tax Day- April 15th, for the curious- and everything else involving personal finance.
Financial illiteracy does not just impact the individual, but it becomes a generational issue as well. While half of the states in the U.S. require personal finance courses in education, the other half is lacking. the problem is the states did not all agree they would teach people to survive overnight.
To understand how financial literacy is measured in a country, a good resource to consider is the P-fin index. It’s an annual survey done by the Teachers Insurance Annuity Association of America and the Global Financial Literacy Excellence Center, with consultation by Greenwald & Associates. It measures U.S. adult’s understanding of finance and management.
According to the P-fin in 2022, 24% of surveyed U.S. adults said they typically find it difficult to make ends meet. in 2023, it rose to 30%.
This lack of financial security is a struggle for these Americans who are not only fighting to succeed in a system that is not exactly built for success, but a lack of education on top of that creates an environment that is even less successful.
This increase in struggle matches the information provided by the P-fin, which says that, “Decreased retirement saving in response to inflation was more common among workers with low financial literacy.”
If we want a society seeing increased numbers in financial success, we need to start with educating young adults and creating more accessible avenues for people to understand finances without the barrier of specific financial language.
There are multiple occasions where friends of mine did not know the functions of a credit card, debt or saving money. I can only say so much to them about it all before I myself am limited to my own knowledge, and before we know it we are essentially blind leading the blind.
Among all the very famous financial educators and millionares of this world, you’d think there would be more emphasis on this kind of education. But those guys charge quite a bit so, there’s that. Looking at you, Dave Ramsay
It becomes a stigma that people who are put in less fortunate circumstances and do not have the means to understand personal financing cannot succeed in life, which is untrue.
Knowledge is not subject to the fortunate, and a successful society can come from an educated kind. Something I’m sure I have repeatedly stated before.
The fact of the matter is, if it isn’t taken seriously there will be an unprecedented number of young adults who are walking into this world blind. And it will have an adverse effect on the country.
