Programs bolster schools' efforts in financial literacy

(MCT)

Sep. 9--The next time your kids ask for some money, have a better answer than simply "yes" or "no." Be ready to teach a little financial literacy.

Show them the everyday steps of balancing a checkbook and using a credit card. Talk about the more durable duties of getting a mortgage and investing for retirement.

Parents are on the hook because evidently kids aren't learning this stuff in school, even when they take courses on personal finance.

''To my amazement ... the full semester course doesn't do anything for financial literacy," said Lewis Mandell, a professor at the University of Washington and advocate for financial literacy.

Mandell said he had expected formal education to make a difference. But he reports that a string of surveys by the JumpStart Coalition have found that students who have taken such courses are no more financially literate than those who don't. Students pass the class but don't retain the information, he said.

It is telling news given that, in May, Missouri high schools turned out their first graduating classes required to pass a personal finance class.

Kansas doesn't have that requirement but encourages teachers to incorporate the same work into math and other courses. And in five years, the Sunflower State will include financial literacy questions on its student assessment tests.

It is also harsh news amid a financial crisis that revealed many adults were unprepared to handle or understand subprime mortgages, predatory lending practices, credit card debts, investment setbacks and other financial pitfalls.

Fortunately, there are many local and national programs to bolster schools' efforts to help the next generation prepare financially.

One of the simpler and more popular programs is The Stock Market Game. Nearly 1,600 teams of up to five students each played the game last spring in Missouri. In the game, students pretend to invest $100,000 in stocks for 10 weeks.

Mandell had dismissed the game as a distorted view of real investing, which requires a time horizon of years to do safely and properly. But, he acknowledged, The Stock Market Game works when it comes to financial literacy.

A 2008 study by Learning Point Associates found significantly higher financial literacy among elementary, middle school and high school students who had played the game.

The game is available through the Missouri and Kansas councils on economic education.

Both states also participate in the Personal Finance Challenge, in which students learn about the topic and then compete in a "quiz bowl" format, said Jim Graham of the Kansas Council on Economic Education.

The Kansas council also developed its own program, called Financial Foundations for Kansas Kids, for kindergarten through eighth grade.