It's Financial Literacy Day today and April is Financial Literacy month so lots of news to compile this week:
- Syracuse University financial aid director Youlanda Copeland-Morgan sees transformation in financial aid's role in assisting students (from Syracuse.com): "Traditionally, financial aid professionals are most recognized for one
thing: helping students pay for college. But now more than ever, we are
also seeing the growing need to counsel students who are in way over
their head with personal financial issues."
- Syracuse has rolled out an array of services including:
- Financial literacy program: "a new financial literacy program — “I Otto Know This” — designed to promote lifelong fiscal fitness for all students. Extending far beyond traditional financial aid office services, the program is a multi-level effort that provides real-life money management skills and resources, and is intended to serve all SU students, including undergraduate, graduate, law and adult learners."
- Personalized counseling sessions: "We’re interacting with students on a personal level, providing them with new resources and counselors who discuss with them savings plans, budgeting, credit, banking basics and other financial-related topics. Additionally, graduating students have the opportunity to meet with a loan education specialist for a personalized loan counseling session. The session provides the student with a summary of student loans borrowed, interest rates and loan repayment strategies specific to the student."
- Group presentations: "We’re also traveling around the community with group presentations on various financial topics."
- More than 1/2 of Americans were not able to save in 2009 according to this survey from Harris Interactive (see press release here):
Forty-six percent of the survey respondents said they managed to save, and many said they did so by curtailing their spending. Most of their cutbacks were on discretionary items, such as dining out (50 percent), travel (46 percent) and clothing (35 percent), though 31 percent of the savers said they've curtailed home renovations. Much smaller numbers said they reduced outlays for medical expenses (16 percent) and higher education (12 percent)."
- Here are the goals of the Canadian financial literacy task force, which rings true to me given the abundance of financial literacy resources out there but little coordination or data indicating what works (from National Post):
"We feel there's lots of good work being done but it needs to coordinated and consolidated." The Task Force's central mission is to take what already exists -- whether by individuals, governments or companies -- and get it implemented and executed, keeping in mind there will be some gaps. "It's not at all a matter of starting over. Many people have done good things. The question is whether we can leverage it. The report will have the important focus of building on the shoulders" of those who have begun the work."
- Here is another way to teach financial literacy, an interactive fair format utilized in New Hampshire (from New Hampshire Federal Credit Union press release):
"The CU 4 Reality Financial Literacy Fair is a culminating, day-long event that will give Rundlett students a chance to see how their own career selections impact their financial well-being and their life choices. At the CU 4 Reality Fair, the students will create a spending plan based on a salary and juggle needs versus wants, to make sure they are living within their means.
Participants will meet with representatives providing them with transportation, housing, utilities, retailers, like Best Buy and Old Navy, to help them understand the real expenses they will face in adulthood and the choices they’ll need to make to avoid falling in to debt."
- Financial Literacy and Education Commission has upgraded their MyMoney.gov site. The site now provides tools such as budget calculators and worksheets and organizes links to federal agency and bureau websites (20 agencies contribute to the site) around life events such as going to college, home ownership or starting/buying a business. For example, the Going To College webpage includes links to Department of Education sites such as Get the Basics: How to Pay for College.
- An argument in favor of financial education AND regulation (from Jim Randel on HuffPost):
Consumers must be the front line in the fight against unethical and illegal conduct intended to remove money from their wallets. Consumers need to be helped by a national commitment to financial literacy. For example, it is a shame that our high schools and colleges do not require courses that educate young adults about mortgages, credit cards, debt instruments, budgeting and investing.
In my view, we will never be able to regulate away all the potential bad conduct. Although we have to try, we also must devote an equivalent amount of energy and capital to raising the financial literacy of our young adults."
- Do the financially literate suffer fewer foreclosures?
From Christian Science Monitor:
Foreclosure starts are approximately two-thirds lower in the group with the highest measured level of numerical ability compared with the group with the lowest measured level. The result is robust to controlling for a broad set of sociodemographic variables and not driven by other aspects of cognitive ability or the characteristics of the mortgage contracts.
- T. Rowe Price has a survey out on how families are discussing money issues today. A few findings (note that parents only give themselves a B- on their understanding of saving and investing principles; seems a teachable moment is at hand):
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Parents Grade Themselves 'B-' on Financial Report Card: Fewer than 20 percent of parents grade themselves an "A" when it comes to their overall understanding of basic saving and investing principles. On average, parents grade themselves a "B-," with one in three giving themselves a "C" or lower. While parents tend to have a better understanding of setting goals, how to save, and smart spending, they are less knowledgeable about the topics of inflation and diversification.
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Moms Are More Proactive Educators: For 60 percent of families, one spouse is more proactive in discussing money and the basics of saving and spending with the children. In those households, 59 percent of the time it is the Mom who is more proactive in taking on the role of financial educator.
Parents Feel They Can do More: Although financial discussions are happening more often, there's still room for improvement as 54 percent of parents say they could be doing more to teach their children about money. Likewise, more than one-third of parents do not believe they are doing all they can to empower their children to make sound financial decisions by the time they are 18.
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- Teens remain optimistic in this poll described in WSJ Blog, The Juggle, while at the same time 2/3 of them are changing their college plans and a quarter don't know how to pay for college:
Yet, these teens have felt the pain of the recent recession. Two-thirds of them have changed their college plans because of the downturn. That’s up from 55% of students who said they changed their plans last year. A quarter of those surveyed this year say they don’t know how they’re going to pay for college."
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