Federal Reserve Chairman Ben Bernanke spoke at a town hall meeting of 60 finance and economics educators to discuss the importance of financial education on Tuesday.
At the Conversation with the Chairman: A Teacher Town Hall Meeting, Federal Reserve Board, Washington, D.C.
Chairman Ben S. Bernanke
August 7, 2012
Bernanke stressed the importance of financial education, as it benefits individuals and our shared economy. “Financial education supports not only individual well-being, but also the economic health of our nation. As the recent financial crisis illustrates, consumers who can make informed decisions about financial products and services not only serve their own best interests, but, collectively, they also help promote broader economic stability.”
Educating youth about basics of financial planning is important, providing students the ability to improve their financial future. “Smart financial planning–such as budgeting, saving for emergencies, and preparing for retirement–can help households enjoy better lives while weathering financial shocks.”
Economic thinking helps individuals make informed and reasonable decisions. Bernanke noted the skills required to make financial decisions is very useful and applicable to all facets of life. “Financial education also provides a context for students to develop important skills that can be applied more broadly. Making good financial decisions requires that consumers seek out relevant information from trustworthy sources, and that they use critical thinking, quantitative reasoning, and decision making skills. These competencies are also some of the fundamental abilities our schools seek to inculcate in our children.”
I was lucky enough to have taken both a basic finance and economics class in high school. These classes were provided as elective type classes. Many students avoided these classes because they were considered harder than other options, but I am sure the extra work required paid off for the students that did elect to take the classes. Many students are not provided with any financial education in high school. Unless you’re a business or economics student, you’re likely to not receive any financial education in college either, except if you seek out the classes electively.
I agree with Bernanke on the importance of financial education and I hope finance classes become a mandatory curriculum in high schools across our country. Even some of the more complicated lessons don’t stick, all students would benefit from being introduced to the ideas of economic thinking and basic financial concepts before they are required to make major financial decisions.
