MONEY LESSONS MOSTLY LACKING
Degree in hand, college graduates are marching proudly into the adult world. Behind those confident smiles, however, are worries about debt, credit scores and money.
According to a recent Experian survey, the majority of college graduates do not feel adequately educated about personal finance topics. The blame, according to students, lies with their institutions of higher learning, which did not prepare them to manage the student loan debt and credit card debt that many face upon graduation.
The survey results also highlight that graduates report feeling stressed, overwhelmed and worried about money. Among the chief concerns were not having enough in savings, not earning enough money, and carrying too much debt.
Teaching personal financial literacy in high schools has a lackluster history in the U.S. Unfortunately, the Council for Economic Education’s 2016 Survey of the States “shows that there has been slow growth in personal finance education in recent years and no improvement in economic education.”
While it is true that some colleges are beginning to provide personal finance courses for credit, few are requiring it for graduation.
The concerned graduates in the Experian survey are joining a culture of adults fretting about money. A quick internet search for “Americans worry about money” returns countless articles and studies about the degree to which we agonize over personal finances, even to the point of physical, mental or emotional illness. While there isn’t a quick fix or a magic solution, there are actions that can be taken to regain a degree of comfort with and control over one’s financial situation. Consider the following suggestions:
• Accept personal responsibility for your own education about money and personal finances. Adults and students alike must come to the realization that, to a large extent, they’re going to have to seek out educational resources and commit to obtaining the knowledge they’ll need to succeed financially without the help of formal education.
• Find community resources. Organizations committed to financial literacy are begging Americans to let them help. The cost of financial illiteracy on our society is staggering, and nonprofit organizations are stepping up to provide resources at little or no cost to those who wish to improve their financial knowledge.
For example, a powerful coalition of organizations that includes the Financial Planning Association, the Certified Financial Planner Board of Standards Inc., the Foundation for Financial Planning, and the U.S. Conference of Mayors hosts Financial Planning Days in cities across the country.
At the annual events, CFP professionals provide one-on-one counseling and classroom-style educational presentations at no cost and with no obligation. In April, organizations across the country participated in Money Smart Week, a week-long event during which “community groups, financial institutions, government agencies, educational organizations and financial experts” work together to “help consumers learn to better manage their personal finances.”
Start locating and attending events like these in your local community that will help address your specific financial concerns.
“The concerned graduates in the Experian survey are joining a culture of adults fretting about money.”
• Make a plan. One of the fastest ways to come to peace with your financial situation is to have a plan in place for improving it. In fact, studies have shown that making a plan measurably reduces stress. Plans don’t have to be fancy or lengthy. Start by putting the basic building blocks in place, like a spending plan. Budgeting tools are endlessly and freely available online. With a little effort, the process can be relatively quick to complete.
• If you need professional help, get it. You wouldn’t self-treat a serious medical problem, perform substantial maintenance work on your car without expertise or defend yourself without an attorney in a serious court matter, would you? A healthy (or unhealthy) financial condition permeates every facet of our lives, both in the near term and in the long term. Financial health impacts our relationships, our physical health and our ability to live a fulfilled, quality life. The right professional, providing the right service, can make a lasting impact on your life and on the lives of those you love. Pair your need with the right professional, whether the need is debt consolidation, credit management and improvement, investing help, or any other financial issue.
While the lack of personal financial literacy education in high schools and colleges is discouraging, everyone has the opportunity to improve their financial health by accepting personal responsibility and taking action to choose their own financial future.