Financial literacy is a vital skill
for young people to learn

Along with being good readers, writers and mathematicians, students today also need to be good with their finances. A significant number of people are not good money managers. When these people get into financial trouble, the rest of us pay the price. Teaching our children about managing credit and finances now will put them on the right track, and helpavoid making the same mistakes that have led us to our country’s current economic crisis.

Credit is a part of life. We use it to buy cars, houses, education, replace appliances and fix our homes in an emergency. Credit cards have gone from specific store cards to universal cards that can be used to pay for everything from groceries to clothes to college tuition. Young children today are aware of credit cards just as I was aware of paper money when I was a child. I knew that when the money ran out, we were finished shopping. Not all children today know that, because they know that we can pay for our purchases with plastic.

To help our children be financially literate, Michigan now will allow high school students to take a course in financial literacy to fulfill one of their high school math requirements. Our students will benefit greatly from a course that can teach them how interest rates work and the money they can save by paying off a balance. Teaching them about finances can also help them make informed decisions about whether they should rent or buy a house, or lease or buy a car. They will benefit from understanding how and ARM works compared to a traditional mortgage.

There are a number of programs that can help students learn about finances. The federal government maintains an easy-to understand website at MyMoney.gov. Junior Achievement also has created a program that can found here. Even elementary-age children can learn about money and finances at Jumpstart.org. Other information and ideas can be found at your local banks and credit unions.

Working with our children now will help them manage money and credit so they can be responsible workers, head of households, homeowners, investors, entrepreneurs, and business leaders. 

Senator Scott represents the 2nd Senate District, which includes areas of Detroit and the cities of Hamtramck, Harper Woods, Highland Park and all of the Grosse Pointes. She serves on the Senate Appropriations Committee. Visit her online.

• Login or register to post comments
• Printer-friendly version
• Send by email