Governor Gretchen Whitmer signed House Bill 5190 on June 16 updating Michigan’s high school curriculum to include a financial literacy course for the first time in state history.
“I remember having a conversation with my own daughter and she was complaining about Algebra 2,” Whitmer said after her annual Macomb County speech to Shelby Twp. last Thursday. “She said, ‘Why do I need to know quadratics? I need to know how to pay my taxes and bills. It’s always stuck with me because it’s really true.
The addition of financial literacy to Michigan’s high school curriculum aims to help young people prepare for life in the workplace, plan a family, buy a home, and establish a personal budget.
“We know that a lot of young people leave high school and never have the chance to really understand some of these fundamental aspects of adulthood and growing wealth,” Whitmer said. “So I think financial literacy is really important and I’m so glad we were able to achieve that.”
Ashley Fordyce, school and community relations coordinator for Extra Credit Union, applauds the bill and says she and her colleagues at the credit union, which was started by two Center Line teachers in 1954, are willing to help instructors who will be teaching personal finance courses but may not have experience with the subject.
“I’m glad the governor is signing the bill to be honest,” Fordyce said. “I anticipate that there will likely be an increase in requests, either to come as a presenter or as a resource for the curriculum. We have always been on a mission to teach young people to be financially responsible, so we definitely support this financial literacy bill.
The Extra Credit Union offers several free financial education programs and presentations for children of all ages. They have been coordinating with area schools and providing financial literacy to students for several years. Many programs, some of which are virtual, teach basic financial management; everything from reading a grocery receipt to learning about building and maintaining credit.
“We try to teach kids financial habits that will allow kids to be successful,” Fordyce said.
It’s very common, Fordyce said, for teenagers to underestimate the cost of things. They don’t know what groceries do or how much a cell phone costs because their parents often pay for those things. Understanding the cost of things is the first step in helping young people establish a personal monthly budget.
“They may know the cost of paying for a car, but forget that they will also need to purchase auto insurance,” Fordyce said. “The real cost of things is always a big shock for children.
“Kids think they don’t have enough money to take care of their personal finances right now, but it doesn’t matter if you have $100 or $10, you have to make choices about how you’re going. manage that money. Sometimes having more money makes decisions more difficult.
Children also tend to get a lot of confusion when it comes to credit cards. Many are unsure of the difference between a credit and debit card or how to establish credit or what a credit score means.
“A lot of our programs are about learning to make choices,” Fordyce said. “We take students through life scenarios where they have to allocate funds to a certain budget and make choices about what type of account to use. We show that you can choose to continue spending small amounts on something, but it might prevent you from saving money to buy something more expensive.
Although family finances are probably discussed more openly than a generation ago, Fordyce said children are still lacking a lot of basic knowledge about personal finances. Finances can be a sensitive topic, even among family members.
“Just having a savings account that you can earn interest on is something kids don’t know about unless someone really explains it to them,” Fordyce said. “Kids go to school and then they’re on their own and they’re just supposed to know these things even though no one has ever really explained anything to them.”
Fordyce notes that some schools, including Warren Fitzgerald and Warren Mott, already offer personal finance classes to high school students. Some schools offer such courses as part of the math curriculum, while others have it in their curriculum as an elective. It’s not yet clear how the new financial literacy bill might impact the delivery of these courses, but regardless of how it’s integrated, Fordyce knows it’s necessary.
“The average age of people filing for bankruptcy is getting younger and younger,” Fordyce said. “We see people at the credit union all the time who come in very young and already quite in debt due to a lack of financial education. Many people learn by making mistakes in the financial world, which isn’t always bad, but it can be important. Better to be proactive. »