Teach Personal Finance in High School, Please

I was almost wrong. Good thing I checked.

Prompted by a New York Times column about a college offering a course in personal finance, I was all set to rail about it being too late in college to teach such things, that it ought to be done in high school. And then I was going to rail about the lack of such a course at our high school.

But our school offers a course that "provides students with practical knowledge and confidence to address many of the complex financial problems of daily living." That includes going to college (I hope there is a section on college loans and their implications), living independently, budgeting a paycheck, understanding taxes and completing a federal tax return.

It just seems to me that kids need to understand this stuff. It would be particularly useful for teens to understand not only the options for financing college, but also why their parents may not be able to fund all college expenses.

Sometimes financial sacrifices (for parents today, or students when they are on their own, paying off loans) make sense. Sometimes they don't. Greater financial literacy may help teens understand why these college-funding decisions are so difficult.

Financial Literacy Important, Too

Our teen's high school has a practical arts requirement, which is fine. Students have to take courses such as word processing, publishing, computer-assisted design, etc., in order to graduate. But I think there's one course that ought to be mandatory for all -- basic personal finance.

When some kids, or their parents, are taking on substantial debt to attend college, I wonder if the students understand the ramifications? Do they know how to weigh the value of the education vs. cost? Do they consider looking at a public college in order to make their start in adult life less stressful, more open to opportunities? There's no right or wrong decision as far as these life questions go, but it would be helpful if there were a base of knowledge.

In late 2009, FINRA (Financial Industry Regulatory Authority), released the first comprehensive study of financial literacy in the U.S. Commissioned by the Department of the Treasury, the report found that most Americans do not plan ahead, whether having a rainy day account for emergencies or funds for anticipated events such as children’s college education or their own retirement. Nor do they understand elementary financial concepts.

And if parents don't understand the basics, who will teach the children the ABCs of personal finance?