Is financial literacy education worthwhile? There was always the assumption that it could be helpful and now, USA Funds, a non-profit financial education organization, says there's research that suggests just how powerful it can be.
The organization commissioned a survey of 1,522 college students who had received personal finance education through their college or university. Nine of 10 respondents said what they learned changed how they manage their personal finances and college life in some way.
Of those students reporting changes in their personal finance behaviors, the respondents reported making an average of 10 behavioral changes. Here are the top five new behaviors:
- I consider if an item is a need or want before purchasing it and spend less on wants. (885 respondents.)
- I established educational, financial and/or career goals. (879 respondents.)
- I researched and understand the requirements to complete my program of study. (813 respondents.)
- I spend more time on activities that help me achieve my educational, financial and career goals. (728 respondents.)
- I use new or different strategies to manage stressful situations. (718 respondents.)
USA Funds invited all students who had completed at least one USA Funds Life Skills lesson between Jan. 1 and Dec. 31, 2011, to complete an online survey. Respondents could choose from a list of 25 possible personal finance behavior change statements, including topics related to managing school life and student loans, managing student finances and managing personal life issues.
"These results indicate that regular exposure to personal finance education can help college students adopt habits that promote completion of their college programs, as well as sound spending and saving practices and wiser use of credit," said Denise B. Feser,USA Funds senior vice president, School and Student Services.
Schools have begun placing new emphasis on financial literacy in the wake of the credit crisis and the growing problem of college loan debt. While financial literacy education is particularly helpful for young people, everyone can benefit from it.
The Federal Deposit Insurance Corporation (FDIC), the entity that guarantees bank deposits, offers Money Smart, a financial education curriculum designed to help low- and moderate-income individuals outside the financial mainstream develop financial skills and create good banking relationships. It's helped educate over 2.75 million consumers since 2001.