If the recent pandemic has shown us anything in our culture, it’s the cracks that exist in the so called financial safety nets that are supposed to catch us when we fall. Numerous surveys show that many Americans live paycheck to paycheck, have little saved for retirement, and lack fundamental financial knowledge. Add a global crises and unemployment and it’s a recipe for disaster.
While there’s little we can do to quick-educate the general population, hope lies in the future.
Illinois is one of 22 states that don’t require high school students to take a personal finance-related class, however the University of Chicago is doing something about that. In early 2019, the university launched finEDge, a high school curriculum that is now being used in Illinois and nine other states.
Developed by The Magnetar Capital UChicago Financial Education Initiative, a partnership between the UChicago STEM Education program and Evanston-based Magnetar Capital, a hedge fund, the curriculum may hold the key to our collective future.
An informal survey of schools on the North Shore found many that are offering financial literacy classes for students as young as elementary school. At Lake Forest Country Day School, even second graders are learning the basics of starting a business from scratch, including developing a company name, logo, tagline, and designing their own storefront. For the schools’ Upper School (grades 5 through 8), math students participate in a stock market game in which they learn about stocks and return on investment.
“At Lake Forest Country Day School, we believe understanding the basics of investing and management of finances are invaluable life skills for our students,” says Joy Hurd, Head of School. “Especially at a time when the workings of the economy are changing constantly and dynamically.”
In addition to offering an AP Economics class, Lake Forest Academy offers two courses—Discrete Math with Application, and Entrepreneurship— that apply algebra, pre-calculus, and other math disciplines to solve problems that occur in everyday financial life. Its Entrepreneurship class teaches students how to analyze business opportunities and develop a business plan.
Fusion Academy in Lake Forest offers Consumer Math, a class that prompts students to explore how math is applicable to their daily lives, including budgeting, career planning, taxes, and handling major purchases such as cars and homes. A Personal Finance course at Fusion teaches students the essentials of day-to-day financial needs, savings and checking accounts, as well as loans and credit.
As far back as 2013, Evanston Township High School has been offering a comprehensive financial literacy program for students that covered, among other topics, savings and checking accounts, credit cards and credit scores, and the difference between renting and owning properties. New Trier Township High School has offered seminars for parents of incoming freshmen to share ideas about how they can teach their children about financial literacy. Steve Kruman, a financial planner, wealth manager, and insurance agent with Bryce Wealth Management, has been a leader in advocating for increased financial literacy education for younger children. Kruman got interested in the idea of financial literacy education due to the fact he has seven children of his own, affirming his belief that education can begin at an earlier age than most people assume.
“I think, basically, as soon as children can be old enough to understand the concept of property …once they can understand what something is and the loss of it and what it takes to replace it,” Kruman says. “They can pretty much do that once they can figure out what their toys are worth. That’s when you can start to teach them basic concepts.”
Summer is the ideal time to teach financial literacy to children, Kruman says, because they can get real hands-on experience. Teaching a child to be financially literate will help them understand that they have to take personal responsibility to be financially secure when Mom and Dad aren’t there to put the food on the table for them.
“Children have a lot of years to grow up,” Kruman says, “and you can give them years of age appropriate financial lessons in their own home that will last a lifetime. Start now if you haven’t already.”