October 11, 2016
The Dire Need for Financial Education
Being financially savvy is a core skill for life in modern society.
A core life skill.
Accordingly, we have to ask the question why this core life skills has been largely cast aside by schools and left to chance that students might learn it somewhere along the line?
We learn all kinds of things in school: The sciences, the languages, maths, the arts, physical education etc. But what about the kinds of things that any graduate will need to have a grasp on almost immediately after leaving school or possibly while even in school? What about understanding principles of finance which go beyond accounting and econs class? Planning for the future? What it means to start a business that truly adds value to peoples' lives? Financially independent and financially free? What is money; mindset or object? In short, one of the vital aspects of adulthood in this complex generation. Financial Education shouldn't just be an à propos in a school's curriculum, it's should be one of the guiding principles throughout education!
National surveys show alarming data for our kids: The lowest levels of financial literacy are populated by young adults; precisely the age group which should be absolutely versed in these matters!
image credit: likesuccess.com
However, we can't just point the finger at them - if we've made zero effort in getting them there in the first place. And this is the case the world over. Recently, the Organisation for Economic Cooperation and Development (OECD) published a study highlighting the absolute need to make financial education part and parcel of schools:
"We should help schools train and encourage teachers and parents to provide financial education for children and youth in order to equip the next generation with better knowledge and skills to make effective and responsible choices and decisions in the complex reality of the 21st Century.” Andrey Bokarev, Director of the National Financial Education and Financial Literacy Programme, Russian Federation
The study highlights that in Malaysia, an unacceptable two percent (only!) of young adults are able to make wise financial decisions with the benefit of sound advice. The issue is far from a problem reserved for developing countries. 73% of adolescents in Denmark have no clue of interest rates, 96% of teenagers in Great Britain say they're worried about money every day.
If your gut reaction is to say "Well, they're only children" then you are of course correct, they are only children. But, on the academic end, parents expect so much more from their kids in knowing things of far greater complexity, yet place no importance on growing their financial mindset. Again, Financial Education not just about the total dollars and cents, it's the mindset.
We believe that building that mindset starting from the primary school level is an absolute. Why not? We're catching them at their most impressionable time where their habits develop. So why not start good habits early in life, instead of spending 10 years (that's being optimistic) in adulthood undoing bad ones? Twenty years from now, this generation of kids, equipped with financial knowledge, will look back and wonder how this was ever a debate in the first place.
“One of the reasons the rich get richer, the poor get poorer and the middle class struggles in debt is because the subject of money is taught at home, not at school.” Robert Kiyosaki, Educational Entrepreneur
If you're interested in taking a closer look at how financial literacy is approached at Dwi Emas, drop by to have a chat with us, have a look here for a quick read and some interesting insight from our teachers, or perhaps watch this video of 7-year old Shailaja, just one of our several students who are thriving in our Financial Ed classes.
Thank you for your time!