The Significance of Financial Education
Something that I have come to realize throughout my time the last four years at the University of South Carolina in the Darla Moore School of Business is the fact that there is a lack of financial literacy in the United States. In addition to learning about financial illiteracy in my finance classes, I have done some outside research on this topic as well. In my words financial literacy is the knowledge an individual has about their financial resources and financial well-being. An example of someone being financially illiterate would be Dani Pascarella from Forbes stating, 44% of Americans don’t have enough cash to cover a 400-dollar emergency. In my opinion this is a major concern because you never know what is going to happen and you don’t want to have to borrow money for something you could have been prepared for. Borrowing money can lead to serious financial concerns and as a result ruin your life. On top of Forbes speaking on the United States, I was able to see this in my daily life because South Carolina ranks 30th out of the 50 states for financial literacy according to Wallethub. Therefore, I believe something needs to be done to make sure that the five million South Carolinians are educated on their finances.
The reason South Carolina is ranked so low in financial literacy is because South Carolina ranks 36th out of the 50 states in financial knowledge and education. In my opinion this is something that can be easily fixed by financial advisers throughout the state. I believe that a program that teaches South Carolina teenagers financial education early on can greatly reduce the lack of financial literacy in the state. This program would best be implemented if it began in high school around the age students can first start working. The reason for this is because this is the first-time teenagers will be making their own income and not relying on their parents. Making money comes with a lot of responsibility and teenagers don’t always know how to handle it. Although dealing with teenagers will not be easy, I believe teenagers can learn to handle this responsibility and prevent financial illiteracy from continuing in South Carolina.
To begin the process of implementing a program in the South Carolina high schools on financial education I will need to start by being hired as a financial adviser. A financial adviser is someone who gives advice and provides services to their clients. To be hired into this role I will need to graduate from the Darla Moore School of Business with a degree in finance. In addition to having a degree in finance I will need obtain multiple licenses, most importantly a certified financial planner license. After working in this profession for some time I will have a plethora of knowledge in the finance field that can be passed on to others.
Passing my knowledge onto others will require me to build relationships with local high schools in the community. To build a relationship with high schools in the community I will present my research to leaders in the school such as principals and teachers. Doing this will ultimately lead them to signing up to become a client and I will continue to help them and educate them. Although I will have other clientele, my main target will be educators, so I can kick start my program. Once I help local teachers and principals with their financial needs I will suggest the idea of coming into their schools to talk to their students about the significance of handling your finances. Convincing these leaders to let me work with their students will give me the opportunity to start my program with the high school students on what it means to be financially literate.
Once I am in the school I am going to plan a detailed presentation for each of the programs. To plan this program, I am going to structure it to best fit the students. Throughout my time as a Resident Mentor I have learned that not all teenagers learn the same way. This will present a challenge when creating my presentation, however I did learn that teenagers learn through persuasion. What I mean by this is if you provide social proof to high school students they will go along with what you are saying. An example of this would be having guest speakers come in to tell their stories on their experience with finances. Doing this would give high school students the opportunity to see that what I am telling them is not a lie and works. In addition to providing social proof to the high school students I can provide a trial for them, so they can have a hands-on experience with financial literacy.
One of the most important things for high school students is having the opportunity to work things directly. If high school students don’t have the chance to play around with what they are learning they will never fully grasp the concept. Next in the presentation I will provide a section that allows the students to work with the material. This is where the concept of leadership that I have learned throughout my time in the Darla Moore School of Business comes into play. When it comes to giving high school students the chance to experience hands-on financial literacy I will have to display servant leadership. Servant leadership is designing work to cater to the people that you are working with. In my case I would be displaying servant leadership by having various exercises that they apply the information they have learned so they can retain the information better. Retaining the information means they will be able to carry on the knowledge throughout their life and pass it on from generation to generation. To make sure students are retaining the information, I am going to have to evaluate them before the program is complete.
Implementing this program as a financial adviser is going to have a great impact on the high school students but is important to make sure that what I’m doing is working. To do this I am going to have a test that displays their knowledge on what they have done over the course of the program. Although it is a test, it is not going to be your traditional test that you have in school. It is going to consist of a presentation on a topic from the program. This can consist of investing techniques, different types of investments, etc. After presenting you will need to have meet the qualifications from a rubric I provide to be considered financially literate. This will ensure me that my job has been done and you understand financial education. Once I have determined the high school students are qualified and financially literate I am going to suggest that they continue their financial education.
Even if someone has passed the test and meet my standards of financial literacy I still believe there is a lot they can learn. I would suggest that they take advantage of the opportunity of working with a financial adviser after the program. Although this can sometimes get expensive, my financial firm would be able to offer discounted rates to students. Doing this will teach them more detailed information beyond the program and build on what they already know. Additionally, I would recommend they help others with the information that they learned from the program. It will give them the opportunity to teach others and learn from others as well. Financial education is crucial to the success of everyone in the United States and hopefully this program I want to start in South Carolina will help prepare everyone one step at a time.