THE ISSUE: Youth financial literacyTHE IMPACT: Educators believe that financial literacy is an important tool to be taught in high school or even in earlier grades. Solid financial knowledge is critical to living a successful life.
Jefferson County school districts are teaching financial literacy classes even before a new law that will require Arkansas students to take them in order to graduate from high school.
Lawmakers approved a new law this year mandating that students receive instruction on a range of standards related to financial literacy, financial planning, taxes and household budgeting. This law does not take effect until 2021 and does not require schools to offer a personal finance course. It directs the Arkansas Department of Education to develop personal and family finance standards that can be incorporated into existing courses.
Watson Chapel High School Principal Kristy Sanders said her district has offered personal finance classes to students in previous years. This year, Watson Chapel students are learning about financial literacy in other elective classes. Ninth-grade students are able to take economics and financial literacy classes. Students in grades 10 to 12 have the opportunity to gain financial literacy through three career and technical education courses.
In Family and Consumer Science, the students learn to assess the benefits of successfully developing sound consumer and personal financial strategies by setting long, medium, and short-term goals, Sanders said via email. Students also learn the benefits of developing a sound financial plan and investigating banking services offered by local financial institutions, she said.
In Family Dynamics, students evaluate the positive impact and benefits of being an informed consumer, Sanders said. The students investigate multiple techniques for managing resources, housing options and consumer banking services. They learn the value of maintaining a good credit rating and evaluate the need for insurance, she said.
In entrepreneurship, the students explore and discuss economic and financial factors related to financial management and inventory control of a small business, Sanders said. In addition to that, students are exposed to strategies for saving and investing wisely, she said.
“The drive behind teaching financial literacy to high school students is to provide the skills needed to become productive citizens when they enter the real world,” Sanders said. “Our plan is to incorporate more community resources as a supplement to the classes we offer to ensure more hands-on experiences for our students.”
“As a community leader, I am thankful for the pride that our stakeholders possess,” Sanders added. “We are a community of diverse backgrounds, but we all come together for one common goal, which is to educate our children and create ways to expose them to greater opportunities than the generation before them.”
According to the Consumer Financial Protection Bureau, teenagers can practice financial skills and decision-making. As they manage their first paychecks, and the spending and saving choices that go along with them, parents are still a sounding board.
“Listening and providing guidance to your teenager can provide a safety net, so that he or she can learn from experiences and mistakes (let’s be honest, there are bound to be a few),” according to the CFPB.
“Young adults learn financial skills more and benefit when they have opportunities to make their own financial decisions, while still receiving guidance and feedback. For example, a program that included connecting economically disadvantaged youth to a job and savings account, and providing just-in-time financial education, showed promising results. Youth experienced ‘both an increase in knowledge and an increase in the application of that knowledge.’”
White Hall School District Interim Superintendent Doug Dorris said his district offers one semester of financial literacy and one semester of insurance and risk management. White Hall is participating in the Wise Financial Literacy certification program this year, which will allow White Hall students (64 currently enrolled) to sit for the test and earn a certification in financial literacy upon passing.
“This program offers tremendous value to students in areas such as money and money management, credit, insurance and investing,” Dorris said via email.
“The certification will show employers that they have knowledge and skills necessary to live and function well in society. We also are participating in the Stock Market Game simulation offered through Economics Arkansas where students learn about stocks, bonds, mutual funds, and how to invest. They learn about working in a team and reaching a consensus. They learn how to manage and have a diversified portfolio.
“Another program we participate in is the H&R Block Budget Challenge. This simulation provides students with real life experience of earning a paycheck, contributing to their 401K program, keeping track of bills and paying bills electronically, keeping a cash flow spreadsheet to use for reconciling their bank statements, and learning about banks and bank fees associated with checking accounts.
“The simulation allows them to make mistakes and learn from them without losing real money. It highlights behaviors that can cause damage to their credit scores, and it shows them consequences so that they are experienced inside the short simulation window. We also have several courses on campus that have finance principles embedded in their frameworks.”
Dorris said White Hall High School teacher Robbie Stewart derives great joy to see students excited about what is happening in the world and how it affects their stock portfolios. Dorris said the recent news about Tesla making an electric semi-truck has students excited about the future. These students want to own Tesla stock and to research and learn, Dorris said.
Pine Bluff Superintendent Michael Robinson and Dollarway Superintendent Barbara Warren did not respond to questions by press time.
The Associated Press contributed to this report.