Financial Literacy Specialist Calls for Money Education to Start Very Early
February 20, 2013:
By Neil Gonzales
February 11, 2013
Personal finance education should begin as early as 3 years old at home and be reinforced throughout young-adult life. Valerie Coleman Morris, a financial literacy specialist and author, called for that jumpstart so young people can develop practical financial competency by the time they are in their 20s.
During her session at the Financial Literacy and College Persistence Conference at Menlo College on January 18, Morris told the audience that she regularly talks to her young grandchildren about money.
"They understand the importance of keeping their money in order and their little wallets neat," she said. "Obviously, they don’t have much stuff yet, but what does your wallet look like? Because the reality is you will tend to spend your money the way you keep it."
However, she pointed out that parents and educators are not as vigilant as they need to be when it comes to giving children financial guidance. Indeed, most schools don’t teach financial matters at young ages, she said.
Nationwide, only 13 states have a requirement that students take a personal finance class while just five states have mandatory testing before high-school graduation, Morris said. But students need to know that they have the right to own and use their wealth, she said. "Not having a good understanding of money is potentially double trouble if parents and other family members are not talking to students about how to make it, manage it, save it and invest it."
Morris encouraged parents and educators to teach children about money at every opportunity. For instance, when her young granddaughter Savannah spotted a nickel on the sidewalk one day, Morris turned that episode into a teaching moment.
"Are you going to leave that on the ground?" Morris asked the toddler. "Oh no," the child replied, "you told me never ever to leave found money." Valerie’s granddaughter decided she would save that nickel to help other people, Morris told the conference audience.
"By the age of 3, children should be identifying coins," Morris said. "That’s the reason why I stood with my granddaughter for so long saying, ‘Yeah, it’s a nickel, and you know what a nickel is?’ Those conversations repeated help to grow a real responsibility."
In their early teens, she said, children should see how their parents pay the household bills. "Show them the lines of credit and the credit card statement," she said. By 18, she said, they should be able to manage their own finances and do their own taxes. Finally in their 20s, she said, they should be able to create a spending plan, be conscious of paying down their debts and start planning for their retirement.
Morris’ session impressed conference participant Ines Barbosa, a senior program associate at First Graduate, a San Francisco-based college success program. "She had some great pointers on important topics that young people in their 20s need to be aware of," Barbosa said. "It was also important to highlight making things practical."