The raging student loan crisis is often cited as evidence that many young people enter adulthood with a deficit in their own financial literacy. According to a 2015 study by the accounting firm PwC, millennials aged 23 to 35 are ill-prepared to handle the monetary challenges they are likely to face. Only 24 percent demonstrated a basic knowledge of financial concepts, and over 40 percent had utilized costly alternative financial providers like payday lenders or pawn shops. A startling 81 percent of college-educated millennials had at least some long-term debt.
In response, states are slowly beginning to mandate the introduction of basic financial education into school curricula, which is admirable and long overdue.
Christopher A. HopkinsBut understanding money, saving and credit begins at home, and should start earlier than you may have thought. Turns out that most everything you need to know about money you should have learned in second grade.
Researchers from Cambridge University have concluded that most of the important habits, both good and bad, that will govern a person’s financial behavior have been established by age 7.
“The habits of mind, which influence the ways children approach complex problems and decisions, including financial ones, are largely determined in the first years of life,” said David Whitebread, one of the study’s authors. This implies that a half-semester high school course in balancing a checkbook just won’t cut it. Ultimately, this is predominantly a home-school subject that needs to begin early.