Financial literacy is a hot topic in the financial industry. Polls show Americans aren't very good at it.

Statistics tend to back that up. Millions of Americans over-extended themselves during the housing bubble. College students have racked up more than $1 trillion in college loans. The average household credit card debt in 2014 is more than $15,000.

The youngest generation of current consumers, Millennials, came of age during the darkest of economic times, which has informed many of their financial habits.

Yet, when FINRA Investor Education Foundation surveyed young adults earlier this year, it found Millennial financial knowledge lacking. Among adults 18 to 26, only 18% were able to answer 4 or 5 questions correctly.

“Many Millennials began their adult lives in the midst of the worst economic downturn in generations, and our survey reveals just how deeply and broadly the Great Recession has marked the financial lives of this generation of Americans, said FINRA Foundation President Gerri Walsh. Unfortunately, far too many millennials trying to cope with these economic conditions have low levels of financial literacy and are wrestling with concerns about their debt.”

Start early

Personal finance educators say starting financial literacy when a child is pre-school age will go a long way to grounding them in financial literacy principals that will stay with them throughout life. Beth Kobliner, author of “Get a Financial Life,” suggests these lessons should begin as early as age 3.

She says the first lesson for a pre-school child should be delayed gratification – waiting to buy something you want until you have the money to pay for it. One tool she recommends is establishing 3 money jars.

Label one “saving,” one “spending” and one “sharing.” Any time the child receives money they decide how to divide it among the three categories. It establishes basic budgeting discipline and the “sharing” jar reinforces the idea of using money to help others.

“I think parents need to start teaching kids about the importance of managing money at an early age,” said billionaire Warren Buffett, in an interview with CNBC. “Sometimes parents wait until their kids are in their teens before they start talking about managing money when they could be starting when their kids are in preschool.”

Secret Millionaires Club

Buffet is supporting a financial literacy effort aimed at children in elementary school. The Secret Millionaires Club is a cartoon web series featuring a group of money savvy adolescents and an animated version on Buffet. Each webisode dwells on sound financial and business principals that children can relate to.

The animated series has 26 online short webisodes and TV specials featured on the HUB cable network.

As children get older the financial literacy tools need to be more detailed and sophisticated. The National Endowment for Financial Education (NEFE) provides a financial planning program for high schools.

Teaching decision-making

The group supports teachers and community organizations in their effort to teach pre-teens, teens and young adults the financial skills they'll need for financial independence and decision-making.

The plans are organized into 6 topics – planning, borrowing, learning capability, investing, financial services and insurance. It includes 6 topical student guides and lesson plans.

By the time students finish high school they ideally should understand budgeting, credit scores and their impact, how to manage a checkbook and the right way to manage debt. But there appears to be a long way to go.

The Council for Economic Education recently surveyed all 50 states and reported only 6 require testing students on their financial knowledge. The Council also said it found nearly half of Florida's graduating seniors lack understanding the financial principals they'll need to help them avoid the mistakes of their elders.

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