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Handling funds: increasing financial literacy among youth

Apr. 4, 2018
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You may never need to calculate the circumference of a circle* in your daily life, but you will need to calculate expenditure.* Did I lose you? This is the reason financial literacy is important. As today’s youth, we should be better equipped to handle our finances. From student loans to making down payments on apartment contracts, we need to know what we are facing. Luckily, there have been plenty of updates on rallying financial literacy for youth!

The urban scene of the music industry has provided one incredible source: 21 Savage. The rapper went on The Ellen DeGeneres Show to perform his hit single “Bank Account” from his 2017 debut album, Issa Album. After his performance, he announced his “21 Savage Bank Account Campaign.” 21 Savage expressed his intentions for the campaign:

“I started the 21 Savage Bank Account Campaign and it’s to help kids learn how to save money and make money and open up bank accounts.”

In an Instagram post later made by Ellen, 21 Savage is seen holding a check for $21,000 made to Get Schooled, the nonprofit with whom he has partnered. Get Schooled is an organization using pop culture and media to inspire and educate youth on topics ranging from college to setting goals. Additionally, 21 teens will start with $1,000 in their accounts thanks to 21 Savage’s Leading by Example Foundation in collaboration with the 21 Savage Bank Account Campaign. (You can check out the essay contest here.)

On the more political side, financial literacy is closer to being part of the school curriculum. Recently, Senate approved a bill 37-0 requiring states to develop and allow cities and towns to format a financial literacy program for K-12 students. According to Beacon Hill Roll Call, the topics would include the following: “understanding banking and financial services, loans, interest, credit cards, online commerce, renting or buying a home, balancing a checkbook, state and federal taxes and charitable giving."

Financial literacy is necessary as early as high school for some youth. Unfortunately, children are not provided with sufficient financial literacy, even internationally. In 2017, the Program for International Student Assessment (PISA) released results of testing 15-year-olds from 15 different countries about basic financial concepts. The U.S. ranked 7th in the evaluation, with 1 in 5 teenage students lacking basic financial literacy. The Organization for Economic Cooperation and Development (OECD) confirms that America is average in terms of teenage financial literacy. However, the results in America have not changed since the first time PISA performed the assessment in 2012. In other words, low financial literacy is an international concern and is not improving.

While youth are not generally bombarded with financial situations at an early age, the transition from high school to college can create a variety of different financial situations. The skills and knowledge required for such predicaments, unfortunately, are rarely acquired until an individual is forced to experience it first-hand. That leaves youth short-handed in handling their finances. We need to be more open and proactive about educating youth on unavoidable life skills, namely financial literacy.

By The Way*

Circumference of a Circle: C= 2πr 

Expenditure: the amount of money spent on something.