NASFAA Attends White House Brainstorming Summit on Financial Literacy Initiatives
The White House convened a room of financial experts, nonprofit leaders and students Thursday to develop a path forward for a national campaign to promote financial literacy in all aspects of life, with a focus on early learning and college planning.
"In our society, financial education typically seems to be an outlier," Consumer Financial Protection Bureau Director Richard Cordray said. "We’re deeply committed to a vision of an America where everyone is financially educated, but the challenges that confront us in achieving that complex, varied and significant. To face them, we must start where all good education starts, with our children."
Created by President Obama in 2012, the Advisory Council on Financial Capability, charged with developing policy recommendations to improve the financial capability of young Americans, launched a new financial literacy tool, called "Money as You Grow." The tool includes 20 lessons designed to help families, community organizations, nonprofits and businesses to promote financial literacy for children starting at age 3 to 18 and onward.
"Rather than educating our young people, we condemn them to making the same mistakes others have made before them in the so-called school of hard knocks, which means it’s no school at all," Cordray said. "When we do not teach children about personal finance, about managing household budgets, or about making informed decisions about larger investments in education or home, we force them to learn it largely, or perhaps, entirely on their own, if at all."
Cordray said the CFPB’s Office of Financial Education will be seeking information and recommendations from experts in financial markets, nonprofits, communities and the public about how to improve financial education.
A panelist on the community leaders panel, Jose Cisneros, treasurer of the City of San Francisco, said his city began working with schools to incorporate financial literacy education into all levels and subjects of K-12 education curricula. But first, Cisneros said the city worked to establish a working relationship with the city’s schools by introducing college savings plans for parents with young children.
The San Francisco Kindergarten to College opens college savings accounts for kindergartners with an automatic $50 deposit from the city and the potential for future incentives and benefits from the city. The account is a one-way account that can only be used toward a post-secondary education.
Technology also provides a lot of opportunities for improving financial literacy education and giving what may appear to be a mundane lesson on balancing a checkbook a bit of an edge. In a display of the kind of interactive financial literacy tools out there, high school students and two NFL players, Washington Redskins linebacker London Fletcher and Detroit Lions quarterback Matthew Stafford, took part in a game of Financial Football, answering financial questions in teams to try to advance down the interactive field and score the first touchdown.
Other available interactive financial literacy tools highlighted at the summit include:
- www.SaveUp.com – A free rewards program that offers incentives for good financial behavior.
- www.PiggyMojo.com – A tool to help users make financial goals and work towards them, using social media sharing tools.
- www.HelloWallet.com – Uses a wide network of financial experts to provide financial guidance.
- www.StockMarketGame.org – Provides students a chance to invest in simulated stock market with a hypothetical $100,000.
The White House is also seeking feedback on a recently launched Financial Capability Toolkit, which provides resources for K-12, community leaders, employers and higher education. The higher education guide provides an outline to improving financial literacy efforts on your campus, including establishing partnerships with schools, curriculum providers and financial institutions and tips for gathering data and identifying metrics.
Organizers of Thursday’s event also introduced organizations that promote economic opportunity and independence among young people in low-income communities, including the Network for Teaching Entrepreneurship (NFTE) and Operation HOPE.
A shining example of the benefits of such programs, NFTE alumnus Rodney Walker, who grew up in foster care, joined NFTE his senior year of high school only to create a successful video production business and attend Moorhouse College, with plans to attend Yale Management School. Walker said NFTE encouraged and motivated him to continue and work hard toward his academic pursuits.
"On a personal level, NFTE has helped me become a change agent in my own personal life. After joining NFTE my senior year of high school, I took my video production idea and was inspired to develop it through the NFTE curriculum. I competed in business plan competitions, won money and used the money to invest in my business," Walker said. "While NFTE taught me this curriculum of making money and finding financial success and independence, I knew that that in itself was not enough, I had to learn to grow in other aspects of my life."
Department of Education Secretary Arne Duncan also spoke with a panel of three disadvantaged youth who found financial independence by seeking out and pursing financial literacy education as young high school students. The students each expressed strong support for a mandatory financial literacy education in K-12 curricula.
"I think so many audacious young people aren’t getting the knowledge and skills and access they need," Duncan said. "As a country, we’re paying a huge price for that, and I think some of the answers and innovative ideas are going to come from you."