It is a sad statement about our society that we need to have an entire month dedicated to financial literacy. Today, a large percentage of individuals and families are experiencing some kind of financial difficulty that is negatively impacting their everyday lives. Money Management International recently reported that Americans carry more than $2 trillion in consumer debt and 30 percent report having no extra cash. This is just Americans – you can only imagine what the figures might be worldwide!
Much of our problem, in my opinion, is lack of education. We need to start teaching basic financial education to children, so that good financial habits are built over a lifetime. The problem is, there are very few schools teaching financial education, and many parents don’t have the resources (or sometimes the knowledge) to teach their children these important lessons.
The good news is that we have a great resource locally. Detroit is home to Junior Achievement Finance Park, a hands-on financial learning center. I recently spent the day volunteering with the FPA of Michigan at JA Park with a classroom of 8th graders from Detroit. I saw first-hand how this high-tech facility can help students learn the basics of money management by spending the day in the life of an adult. Students were assigned a life scenario and were responsible for:
- Calculating their Net Income (salary after taxes)
- Managing monthly expenses by making lifestyle choices
- Setting aside a portion of the budget for savings and charitable giving
- AND, ultimately, creating a balanced budget
As we all know, this is not always an easy task. The day provided students with some real-life perspective on how difficult it can be to manage money, and on why Mom and Dad sometimes have to say “No” to their daily wants.
In honor of Financial Literacy month, you have the opportunity to visit JA Park with your children FREE of charge this Saturday, April 28th, from 9 a.m. to a 1 p.m. for JA Family Day. I encourage you to attend with the children in your life…let’s work together to help the next generation become financially literate!
Please feel free to e-mail me for additional financial literacy resources for children and adults.
Raymond James is not affiliated with Junior Achievement.