It is essential to effectively managing your adult life—yet it’s complicated, difficult and confusing, and despite years of education, most young people have never had any formal instruction in it: financial literacy.
Being financially literate means being able to create a budget; knowing how much money to save and how to invest it; and understanding critical concepts that affect your money, such as interest compounding, inflation and risk diversification.
Despite its importance, few states require students to take a personal finance course to graduate from high school. Even fewer mandate testing students on finance topics, according to Council for Economic Education’s 2016 Survey of the States. And so perhaps not surprisingly, students in the United States rank lower than their peers in other countries when it comes to financial literacy.
“Financial literacy is an essential skill for life in the 21st century, but research shows that the majority of young people lack critical financial knowledge,” said Annamaria Lusardi, founder and academic director of the George Washington University School of Business’ Global Financial Literacy Excellence Center (GFLEC).
The Financial Literacy Fast Lane, a project now under development by GFLEC, aims to close this knowledge gap by creating an online toolkit that will help parents, guardians, principals and educators around the country more easily add financial literacy courses into their school’s curriculum.
The project is funded by a nearly $700,000 gift from PwC US.
“We’re excited to sponsor this project,” said Colleen Kipfstuhl, director, Responsible Business Leadership, PwC. “Knowing that so many teachers end up developing financial literacy curriculum on their own, the Financial Literacy Fast Lane will provide them with centralized, effective resources, along with a place to ask for help on specific topics. Helping teachers be prepared ultimately benefits all of the students they teach.”
The online toolkit, which is expected to launch in January 2019, will “enable school communities to successfully implement financial education,” said Dr. Lusardi, who recently was recognized as one of the most frequently cited researchers in the fields of economics and business.
“This education will provide a foundation of knowledge on which young people can build lives of financial stability.”