By Vernita Dorsey for WSFS Bank
A solid financial education foundation can be key to future success managing money.
Unfortunately, many younger generations are left with the feeling they’re “on their own” to figure things out when it comes to personal finances. A recent study from WSFS Bank of 2,005 Americans between ages 18-40 found 61% of respondents agreed that most of what they’ve learned about finance was through osmosis, with 75% of men agreeing compared to 49% of women.
This lack of a structured financial education can have a major impact on the ability of younger generations to reach financial milestones.
Here are a few ways we can work together to improve financial lessons across the board to help future generations build confidence in their money management.
Schools, Banks and Financial Institutions
Only 23% of respondents to the WSFS survey said they learned financial skills in school, and just 17% cited their bank or financial institutions as a source of financial lessons.
According to Next Gen Personal Finance’s 2019-2020 Progress Report, only 17% of students were required to take a personal finance class with only 3.9% of students from low-income schools required to do so.
With budget cuts over the years and limited resources for additional curriculum to be added to an already packed schedule, it is no surprise that many students don’t receive a formal financial education in school.
This is where banks and financial institutions can help.
By partnering with local schools to provide in-classroom financial education lessons, banks and financial institutions can help bridge the gap and make up for lack of resources in schools, while tapping into the expertise of their own employees and serving their communities at the same time.
Parents and Family
While parents topped the list of sources for financial lessons, only 36% of respondents said they learned from them, with romantic partners (33%), siblings (27%) and other family members (26%) not far behind.
Finances are often a taboo subject among families, and 50% said thinking about discussing money with their family makes them very uncomfortable. While 55% percent said their parents or guardians were good financial role models, it is clear more explicit guidance could benefit these generations when it comes to financial education.
It’s important for families to introduce basic financial literacy principles at an early age to equip children for the future. Giving your child an allowance for chores, playing fun games like “restaurant” or even taking them on your grocery trip can help them learn the value of saving, budgeting and the cost of items.
Only 23% of survey respondents said they utilized online or print publications to learn about finances. Whether you’re a parent searching for lessons for your children or just looking to brush up on financial principles yourself, there are a wealth of financial literacy resources available online for all learning styles – from interactive tools like WSFS iQ to articles and podcasts.
It’s important to utilize all the tools at your disposal to help educate yourself and your families. What may seem like minor lessons now can help serve as the building blocks for a solid financial foundation later in life.
While younger generations may feel as if they are on their own to figure things out when it comes to their financial situation, it’s important to remember that learning is life-long and it’s never too late to strengthen your financial acumen.
By working together and utilizing the various educational avenues available when it comes to financial education, we can help ensure future generations have the knowledge and confidence needed to successfully obtain their financial goals.
About the Author – Vernita Dorsey
Vernita Dorsey is Senior Vice President, Director of Community Strategy at WSFS Bank. She has more than 35 years of experience as a community banker and has actively served her community throughout her career.