Financial literacy: It's not as easy as ATM
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High-schoolers who don't receive any financial instruction by the time they graduate rarely come across it in college either. However, seminars or noncredit classes are often available. Smith College last year started a series of weekend and evening minicourses as part of its new Women's Financial Education Program, funded by investment bank Goldman Sachs and an alumna who is a partner there.Skip to next paragraph
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A few universities are promoting financial know-how as soon as students walk in the door. Oklahoma State, for instance, added a personal-finance session to its freshman orientation programs.
The University of Wisconsin at Madison last fall initiated "Money Talk," a series of peer-led workshops in freshman dorms. At the end of each session, students participated in a trivia contest, and the winners received $50 US Savings Bonds. The school is also opening a peer financial-counseling service.
What students haven't learned by the end of their formal studies, they need to pick up on their own as adults. An alumna of Columbia University who works as a financial adviser at Salomon Smith Barney in New York has been giving free seminars on financial planning to the Columbia College Women alumnae group. The evening workshops are among its best-attended events. Often the questions from the Ivy League graduates cover the basics of saving, investing, and crafting a personal financial strategy - the very topics that experts say should be introduced in high school.
Despite increased efforts to teach children about personal finance in schools, they still learn about money first and foremost at home. Here are some tips on how parents can help instill financial responsibility:
Speak up about money early and often while your children are growing up. Many parents grew up in households where it was considered improper or impolite to discuss money matters, but times have changed.
"People are not doing their children a service if they don't involve them in the family's finances," says Elisabeth Plax, a certified financial planner in the Cleveland, Ohio, area. "Children don't need to know about every bill, because that's not what childhood is about, but parents should talk with children about their own attitudes toward money and explain basic principles of saving and spending."
Make lessons hands-on. "Give children an allowance, and then make them responsible for paying for certain things so they can learn about budgeting and saving," says Michael Gutter, an assistant professor at the University of Wisconsin at Madison. Open a savings account in the child's own name and have him or her make deposits and watch the money grow. When children are older, involve them in investing, perhaps by using mock accounts that some websites offer.
Use outside resources. The Internet offers myriad sites for learning about money. One teacher's favorite website to send students to is www.ntrbonline.org, which is designed for youths by the National Endowment for Financial Education. Another teacher likes www.themint.org. Jump$tart hosts an information clearninghouse on its site (www.jumpstart.org), where parents can search for resources by topic and grade level.
Mr. Gutter recommends the book "Capitate Your Kids: Teaching Your Teens Financial Independence," by John Witcomb (Popcorn Press, $16.95).
Encourage schools to introduce personal finance. "There are countless initiatives to get these things into the schools, but the schools say, 'We don't know if parents want this,' " Gutter says. "Call up your school and tell them you want personal finance taught, or let teachers know during parent-teacher conferences."