The case for financial literacy instruction

The Canadian Council on Learning recently released a report on the need for financial literacy instruction. This report highlighted recommendations from the Canadian Task Force on Financial Literacy and found that financial literacy instruction is a critical component to help citizens make responsible financial decisions that will help them achieve their personal goals and enhance their quality of life.

In this sense, financial literacy is “the ability to apply to apply knowledge across a range of contexts (both predictable and unexpected situations), and includes the ability to manage and resolve financial problems and opportunities” (Cappon, 2010, slide 7).

The task force argues that students, too, need to be equipped with 1) the knowledge of personal and broader financial matters, 2) the related skills to apply this knowledge appropriately in a variety of situations, and 3) the self-assurance to make necessary financial decisions confidently. As such, financial education and learning is an “essential skill” that needs to be included in the local school curriculum. In fact, it has been noted that the OECD will be including a financial education component in the 2012 Programme for International Student Assessment (PISA) (Cappon, 2010, slide 6).

Clearly, time needs to be set aside to address this important subject in our schools.

Important topics that need to be addressed include learning about budgeting, saving, investing, borrowing, keeping financial information safe, credit ratings and using credit wisely, understanding your rights and responsibilities as consumers, dealing with financial institutions, etc.

This instruction should address both the day-to-day situations that high school students may face, such as comparing prices online or saving for the latest gadget, and also help prepare them for future financial encounters, such as managing day-to-day living expenses in college, navigating financing options for a car or a home mortgage, deciding on investments, etc.

Ultimately, any instruction in fostering financial literacy should assist students to come to understand the economic implications of their financial decisions. Moreover, such instruction in a Christian High School is particularly important as it provides a discipleship opportunity to foster a biblical view of finance and stewardship of money.

Resources:

Canadian Council on Learning. (2010, Dec.). Money-wise: The growing importance of financial literacy in Canada.  Retrieved Dec. 14, 2010 at http://www.ccl-cca.ca/CCL/Reports/LessonsInLearning/LinL201011FinancialLiteracy.html

Cappon, P. (2010). The Changing face of literacy: The financial literacy imperative. Accessed Dec. 14, 2010 at http://www.ccl-cca.ca/pdfs/LearningLink/FinancialLiteracyPPT_EN.pdf

Task Force on Financial Literacy. http://www.financialliteracyincanada.com/index.html. Accessed Dec. 14, 2010.

http://www.yourmoney.cba.ca/

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