Why Learn Financial Literacy From a Young Age

In today’s unpredictable economy, financial literacy is more important than ever. Housing costs consist of a much bigger portion of our income than it did two generations ago. Yet, many young people graduate high school without understanding how to budget, invest, or manage debt. Even if students haven’t started their first job or applied for their first credit card, learning financial literacy early can set them up for lifelong success.

Financial Literacy Prepares Young People for Real Life

Schools teach math, science, and history, but they often overlook one of the most crucial subjects: money management. Understanding how to budget, save, and invest should be a fundamental part of education. Without these skills, young adults enter the workforce unprepared to handle their finances, leading to unnecessary debt and financial stress.

If students learned about topics like interest, credit scores, responsible spending habits, and investment options, they would be better equipped to make informed financial decisions. This foundation would help prevent impulsive spending habits, which can have long-term consequences. Even if they don’t plan to invest, learning about investment options such as real estate, bitcoin, and stocks helps them avoid possible scams. They should also learn debt management, such as paying off credit cards, loans, and mortgages. 

A Job Alone Is No Longer Enough

Schools teach that the natural path in life is school, then a job, then financial stability. While having a steady income is important, today’s economy is more unpredictable than ever. Layoffs, automation, and economic downturns can make job security uncertain. Relying on a single income source can leave people vulnerable to financial hardships.

This is why financial literacy should go beyond just budgeting and saving—it should also emphasize multiple streams of income. Schools should teach students about side hustles, investments, and ways to upskill without going back to school to provide financial security outside of traditional employment.

Side Hustles and Alternative Career Paths Should Be Encouraged

The traditional college route is no longer the only path to success. While higher education can be beneficial, it’s not the right choice for everyone. Many students would benefit from learning about trades, entrepreneurship, and freelancing as viable career options.

Side hustles—such as finding a job and then finding your own clients for the work you do (such as graphic design) are an option. Starting a side business, such as reselling products, allow individuals to generate additional income. Likewise, trade careers in plumbing, electrical work, and construction offer high-paying opportunities. Schools should educate students on these options to help them make informed career choices.

Key Takeaways

Financial literacy should be taught at an early age. It provides students with the tools needed to navigate today’s economy, build wealth, and create financial security. Learning financial literacy prepares students for real-world financial challenges, ensuring they have the knowledge and skills needed to succeed in any economic climate.