Starting financial education early pays big dividends, and that’s why we at Cardinal Credit Union are big supporters of these types of initiatives—and have been since 2012, when we began working with area high schools to develop financial educational resources for today’s youth.
Financial education for youth can set the foundation for a bright future. When students learn the ins and outs of budgeting, the importance of saving, how credit works and what effect taxes have, they are learning financial responsibility. This knowledge will serve them well as they enter adulthood.
These often high-stakes lessons don’t just prepare them for adulthood—they set them up for success or, conversely, failure. Students exposed to financial education are more likely to avoid unnecessary debt, save regularly and plan for long-term goals, according to research from Harvard Kennedy School.
Yet, many secondary educational institutions have been slow to adopt financial education coursework, especially as a requirement of graduation. I have seen firsthand how financial education gives young people the tools to make informed decisions so they can build a future rooted in financial stability.
This is where credit unions, which are often immersed in their communities as the stewards of financial responsibility, can step in and help foster an environment of financial readiness for today’s youth. Early financial education enables financial autonomy and helps young adults make informed decisions about all aspects of money management.
How Credit Unions Can Help Fill The Youth Education Gap
Credit unions can help kids learn the value of money and, even more importantly, the value of delayed gratification—especially in today’s “now” society—by understanding the basics of saving, budgeting, spending and investing starting at an early age.
Preparation is key and can start early, with even the youngest understanding how to make real-life decisions by teaching them to save and to earn money for items that they either want or need. We can help them to distinguish between the differences of needs and wants and how to plan accordingly.
At my credit union, we recently launched a savings program in partnership with the Cleveland Browns for the youngest members of the community that builds a foundation of financial education and literacy for elementary school-aged children—a first in the community and nationwide. All Lil’ Brownies credit union members receive free savings and an exclusive Brownie the Elf debit card with great benefits, including parental controls. The program helps school-aged children learn how to budget and manage their money.
Once they hit the teenage years, we work with several schools in northeast Ohio to provide an eight-week, hands-on financial education course, which includes free checking accounts for all participating high schoolers. We also run in-school branches to provide hands-on learning.
These programs encourage young adults to work and learn about managing their part-time job income, their allowances and other income streams, like even starting their own business. This year, Ohio Governor Mike DeWine approved a state budget that lets school districts offer students the option to meet the financial literacy graduation requirement by participating in student-run credit union branches instead of taking classroom-based lessons—now that’s progress!
Takeaways For Financial Leaders And Educators
Credit unions can turn commitment into action. At Cardinal, providing youth education isn’t just part of our mission—it’s one of our top priorities. Here are a few ways that today’s financial leaders and educators can help enable financial education for young people:
1. Prepare today’s youth for tomorrow by offering financial education classes and tools.
2. Financial institutions should look to partner with like-minded organizations to build resources and deploy programs that can enable a healthy financial attitude in today’s youth.
3. Offer programs that teach hands-on learning opportunities, such as fractional investing and early money management through parental-controlled debit cards and in-school student-run branches.
4. Gamify activities for youth to add more excitement and fun to learning about money management.
5. Help to make financial wellness classes an essential part of the school curriculum, just like math and science.
Financial education for youth can be provided by a number of sources, including parents, financial institutions, schools and other community resources. All of these individuals and organizations play an important role in raising the understanding and importance of financial management early on. A hands-on approach to teaching and sharing of available online and in-person tools and instruction can go a long way in solving this still-present gap.
Credit unions, driven by their mission of “People Helping People,” are ideally positioned to provide an appropriate level of preparedness, for today’s school-aged children and into their high school years, as students ready themselves for adulthood.
The information provided here is not investment, tax or financial advice. You should consult with a licensed professional for advice concerning your specific situation.
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