Personal finance education is key to financial confidence in adulthood

BYU senior Amy Wilson uses one of the ATMs located outside the Wilkinson Student Center. Wilson, like other students, learned more about personal finance while at BYU. (Morgan March)

See also “Teaching personal finance in high school to fight against growing student debt”

Sarah Boyce left her hometown in Indiana and came to BYU excited about the academic and social opportunities that awaited her. She had recently opened her first bank account and received her first debit card. She lived on campus, had a meal plan, and had a scholarship to help pay for tuition. She was convinced that she would succeed as an independent student.

However, Boyce ran out of money in February of his freshman year and had to borrow enough money from his parents to get him through the remaining three months of the semester.

“Even though I was pretty independent in high school, I realized when I got to college all the things I didn’t pay for before, like laundry, housing and food,” Boyce said.

Now a junior, Boyce said she wished she had been better prepared for the financial responsibilities that come with adulthood and college life.

High school students often dream of becoming adults and going to college, but newly independent students don’t always fully realize the significant pressure that adult responsibilities can put on their wallets. This is only magnified without proper personal finance education – whether this omission happened at home or at school.

“Being taught about these things would have increased my confidence level,” Boyce said. “It wouldn’t have been so stressful or terrifying. I don’t think people get the help they’re entitled to because they just don’t know how to get it.

According to a 2018 study by the Council for Economic Education, only 17 states in the United States require high school students to enroll and take a personal finance course. The number of states requiring such a course has not increased since 2016.

According to a 2018 study by the Council for Economic Education, only 17 states in the United States require high school students to enroll and take a personal finance course. (Morgan March)

“Utah high school students need to take a financial literacy course to graduate,” said Dana Adcock, BYU assistant professor of family life. “This course helps them navigate topics such as credit, debt, money management, and savings.”

The course is to be taken during the junior or senior year of the students. According to the Utah State Board of Education, when enrolled in the finance course, “students will acquire the information and skills necessary to implement a plan for lifelong financial success.”

The course covers topics like basic economics, personal financial goals, income, investment strategies, budgeting, credit scores, and more. Upon completion of the course, students can work towards obtaining certification.

“As a school board member, I support all efforts to educate every student appropriately,” said Sara Hacken, School Board Member for the Alpine School District. “It would definitely include the life skills courses that we offer in the district. “

While states like Utah are working hard to help students develop the skills they will need after leaving high school, there are 33 states that do not require a high school personal finance course.

However, college students who weren’t required to take a finance course or didn’t have access to those courses in high school can still take college courses to learn how to be financially independent. Colleges across the country offer personal or family finance courses to help students learn the basics of managing money, taxes, investing, and other topics.

The BYU Financial Fitness Center is designed to help students of all ages and circumstances, including those who are getting married, expecting a child, graduating from college, moving on to graduate school, or considering taking more student loans.

From tax assistance to retirement planning, students can meet with financial health advisors who will guide them in these financial decisions and matters.

In addition to the Financial Fitness Center, located at A-166 ASB, the BYU School of Family Life offers a family finance course – SFL 260 – to help students learn about smart money practices and take control of their personal finances.

Throughout the class, students learn not only basic concepts like budgeting, but also complex concepts like buying a home or planning for retirement. Other topics such as credit, taxes, insurance and investment are also discussed.

These topics are often unfamiliar or uncomfortable for students who have not received proper instruction on personal finances from their previous schooling or homeschooling.

“I am amazed at how little students know about finances at the start of the course and how much they learn during the course,” said Jeff Hill, associate director of family studies. “I have received countless emails thanking me, especially when it comes to big financial decisions like buying a car or a house.”

In order to give students real experience in managing finances, many assignments in SFL 260 require students to practice concepts learned in class with their own money. Some of these hands-on assignments include creating a budget, documenting a personal net worth statement, and creating a savings plan to purchase an item of the student’s choice.

“I ask my students what they have learned and what skills they have developed at the end of the semester. Most of them say they learned a lot, ”said Jeff Dew, family finance professor at BYU. “It’s gratifying to see a student tell me that he is in a more stable financial situation – or even just happier – because he knows how to manage his money now. “

Dew said a basic understanding of financial principles is essential for students to have freedom in their lives.

“When we understand and apply sound financial management principles, we are more free to act both now and in the future,” said Dew. “It’s also about having a stable financial situation. Sound financial management behaviors promote stability. While we may not become the next millionaire, we will have a more secure financial situation. “

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