Flash and graphics examine personal finance education

Because I’ve been doing so much copy editing and designing for my internships, I haven’t had a chance to write much for the Web. However, I was pretty happy with a project I did for my Advanced Online Journalism class last semester.

For this project, which covered personal finance education — or lack thereof — in Nebraska high schools, I wrote a story, made graphics and created a Flash quiz.

Looking back, I really wish I would have made an audio slide show to personalize the story, but for my first project in the class, I was content with picking up a few new skills. (Oh, and many thanks to Adam for getting me through Actionscripting hell.)

Anyway, here it is, with apologies for the gross lack of proper proportions between font sizes of headline/subheads/text. I’m still figuring out how to mix and match them so they all work together.

 

Study: Students lack financial know-how

Teachers and personal finance advocates agree: 
Young Americans are in the dark when it comes to money

 (000000; text-decoration: none;">Originally posted February 26, 2008 on 000000; text-decoration: none;">NewsNetNebraska, a online news source run by students at the UNL College of Journalism and Mass Communications)

Students coming into Duane Baack’s classroom sometimes carry a credit card, but they don’t know the first thing about credit – or most anything else when it comes to personal finances, the economics teacher said.

“I’ve got students who think if you’ve got a credit card, you’ve got money,” said Baack, a teacher at Lincoln Southwest High School.

In Donna Strabala’s class at Southwest, many students are clueless on how to fill out deposit slips for their checking accounts.

Teachers and financial literacy advocates agree: Students graduate from high school not knowing the basics of managing money.

These financial basics include bank accounts, credit cards, investment options and strategies to save money, among other things.

A broader trend

Baack’s and Strabala’s students at Southwest are not the exception to the rule. Laura Levine, executive director of the Jump$tart Coalition for Personal Financial Literacy, said students nationwide are falling behind in knowing how to manage money.

The coalition consists of nonprofit groups, governmental organizations and financial institutions that together work to promote financial education among kindergarten through 12th-grade students. Levine said many school districts around the country, like Southwest, do not require students to take a course in personal finances.

And without that requirement at school, the responsibility falls to parents to teach their sons and daughters about money management.

Failing grades

According to a survey Jump$tart conducts every other year, this current setup isn’t working. In fact, Levine said, the results have been pretty dismal.

“Students on average fail every time. … And if they’re scoring an average of 52 percent or so on that test, students don’t know enough,” Levine said by phone from the Washington, D.C., headquarters of Jump$tart.

According to the 2005-2006 survey, about 14 percent of students knew stocks would have high higher average returns than checking accounts over an 18-year period.

Just 40.3 percent of students realized they could lose their health insurance if their parents became unemployed.

Read the full results of the 2006 survey.

Baack said students likely will learn these important lessons only when absolutely necessary. “It’s scary because financially, these people aren’t going to figure things out until there’s a problem,” he added.

Think you can do better? Try out an shorter, interactive version of the Jump$tart quiz.

No simple solution

Though the survey results and the Southwest teachers’ experience in the classroom illustrate a fairly clear problem, financial illiteracy doesn’t have a clear-cut, easy solution, Levine said.

“We can’t look at one place to be the cure for financial illiteracy. The cure will come from a well-rounded approach,” she added. “And we can’t just teach finances one time and then check it off our list and say, ‘OK, we’re done.’”

Blake Waggoner, a Lincoln native and senior at Hastings College, agreed, saying his personal economics course in high school was too broad to teach him all he needed to know. Guidance from his parents was crucial, Waggoner said, even if he didn’t make it easy for them.

“From the time I was little, I was told how to save money and how to spend, but the older I got, the more independent I thought I was, and that [rebellion] came over into the world of finances,” Waggoner said.

The importance of his parents

Though he might not have listened to them as much as he got older and a bit more defiant, Waggoner said his parents were right to keep doling out advice.

“Parents need to play an active role,” he said. “It may not always be pretty, but parents are your core.”

As a teacher, Baack said parents should also do more than lecture their children and explain finances in theory; they should put lessons into practice.

“If kids are given a dollar every time they ask for it, they’re not learning much,” he said.

Lack of courses

A parent’s role is especially vital, Baack said, because Southwest does not have a class specifically geared toward personal finances. Though Baack added money management into the curriculum for his economics class, he said one class just isn’t enough.

Many schools across the country don’t even offer full courses in personal finances, said Levine, Jump$tart’s director. So students who want to know more about managing money or investing in the stock market may have a tough time finding classes that teach what they want to learn.

Levine said more could be done by parents and schools to achieve the well-rounded approach that she said works best in teaching students about managing money.

“I always say personal finance needs to be in school, after school and at home.”

Banks get into the game

As part of that in-school and after-school time, financial institutions are lending a helping hand to any teacher or parent who wants it. Banks such as Wells Fargo offer online resources to teach the basics of managing money.

• For fourth and fifth graders: An animated alien, Zing, explains foreign concepts, such as where money comes from, and the hard realities of life, such as discerning needs from wants.
• For young adults, the bank offers tips on staying financially secure as well as quick fact sheets about important financial terms, such as FICO scores – the credit scores developed by Fair Isaac Company – which help lenders determine who qualifies for loans and whether they receive high or low interest rates.
• Wells Fargo also offers a “checking account with training wheels” for teens that allows parents to monitor spending more closely and sets limits on daily withdrawals, said Angie Kaipust, assistant vice presidents for communication at Wells Fargo.

For instance, Kaipust said, “A parents might want a text message or e-mail every time the account gets below a certain level.”

This type of account works basically like any other checking account, but parents get a bit more say in how much can be spent, Kaipust said.

College — and beyond

Looking back, Waggoner said parental involvement was viatal in his financial education, but looking ahead, the college senior summed up his biggest concern in two words: growing up.

“What I worry about is graduating and [dealing with] insurance, health care, Roth IRAs,” he said.
Waggoner said he doesn’t consider himself very adept at navigating the world of finances after graduating, a problem that universities could help remedy.

“Quite frankly, I think colleges and universities should not just offer, but require a [personal finance] course for exiting seniors,” he said.

In the end, Waggoner said, students may have to take responsibility to learn how to manage money on their own.

If students don’t learn the right way from parents or teachers, it’ll be up to them to discover the ups and downs of managing money, as Waggoner said he did after his first overdraft fee on his checking account.

“I was 16, and just like a lot of other things in life, you learn from your mistakes.”

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