Financial Education for Youth Is More Important Than Ever – Kiplinger’s Personal Finance

Amid economic uncertainty and a looming recession, financial education for young people is more important than ever. That’s why it’s time to give your teen access to your money and let them start investing it.

I’m serious.

As a caveat, I’d like to clarify that you should not give your children unlimited and unfettered access to your finances – that would almost certainly not be a great idea.

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However, I am strongly and earnestly encouraging all parents to empower and enable their children to invest a controlled amount of their money in equities, bonds, funds and other investment vehicles.

And you should do so soon, because new research and data suggest young people are quickly falling behind as it relates to critical financial literacy skills. In fact, a report released by the Milken Institute (opens in new tab) found that many high school students lack even basic financial knowledge and skills. According to that same report, only 12% of 15-year-old students in the U.S. demonstrated the highest proficiency in areas such as looking ahead to solve financial problems or making the type of financial decisions that may be relevant for them in the future.

Lack of Financial Education Is a Growing Problem

This is a massive and growing problem, and if it is not addressed quickly, it could result in a generation of young adults who make financial mistakes that have grave, real-world consequences. This is a statistically backed possibility, with research showing that Americans who lack financial education have inadequate household and retirement savings, poor credit scores and high student loan debt (opens in new tab). These consequences could prevent young people from renting an apartment, buying a home, securing a loan or, in some cases, landing certain jobs.

This lack of financial literacy among young people is not for a lack of desire to learn these skills, though. Another survey from the London Institute of Banking and Finance (opens in new tab) found that a majority of young people said they would like to start learning about money between the ages of 11 …….


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