Many states falling down on financial literacy

Wednesday, October 28, 2015

We have to admit feeling some sympathy for students struggling with homework.

"When am I ever going to need to know how to solve a quadratic equation?"

Parents and teachers may have a better answer now that there's an increasing emphasis on STEM classes -- science, technology, engineering and math -- in our nation's schools.

But most schools, Nebraska's included, are not doing that great of a job providing students with skills and knowledge we know they will need in everyday life.

Nebraska hasn't completely dropped the ball, according to a report produced by the Center for Financial Literacy at Champlain College in Burlington, Vermont.

The Nebraska Treasurer's office gets kudos for launching an initiative to promote financial literacy for high school students, but overall, the state receives only a "C" on the 2015 National Report Card on State Efforts to Improve Financial Literacy.

Nebraska doesn't require a specific personal finance course for graduation, but our students are required to take 30 credit hours in social studies including economics concepts. Otherwise, it's up to local districts.

About a third of the economic concepts are personal finance in nature, and local standards must be equal to or higher than the state's.

Parents aren't doing that great of a job conveying sound financial judgment to their children, according to John Pelletier, director of the Center for Financial Literacy and author of the report.

He says he's walked into high school classrooms where most of the students believe their chosen career will make them at least $100,000 a year.

"You can see how people, based on that flawed analysis, think that they can afford $70,000, $80,000 or $90,000 in (college) debt," he said. "What needs to be taught is more career exploration, more understanding about income."

The authors have an ally in University of Nebraska President Hank Bounds, who appreciates the value of graduating from college with as little debt as possible.

He grew up on a rural Mississippi farm and his military service helped him pay for undergraduate and graduate degrees. Financial literacy is important for college students, he told the Gazette, and students should know enough not to borrow more money than they need to graduate.

Check out the complete report here: http://bit.ly/1LC0Kmx

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