If you are like most college students, you dream of graduating, landing your dream job, and raking in wads of cash. After all, you will have worked hard, studied into the wee hours of the morning, and forked over a sizeable amount of money in order to complete your degree. You will have earned success.
But while you were mastering your craft in the hopes of earning the big bucks, you neglected to learn one very important thing–how to manage, protect, and invest that sizeable income. Yes, the best education is one that includes financial literacy.
How will an education that includes financial know-how benefit you? Let’s count the ways.
Financial Matters are More Complex
If you remember vinyl records, Huckleberry Hound, and Tab, you likely also recollect a time when personal finance was merely a matter of choosing between a checking or a savings account. Well, the world has moved on to iTunes, Huckleberry Hound is dead, and Tab was full of saccharin. And consumers must now choose between a range of financial products more numerous than the colors of the rainbow. In order to make the decision that is best for your future, you need to possess the type of investment know-how that comes from receiving a good financial education.
You’re Retirement is in Your Hands
There once was a time when employees could expect to stick with a single employer throughout their career. Your company provided you with a comfortable pension and retirement savings was never an issue. Boy, have things changed. Thanks to a sizeable decrease in job security and fewer businesses offering their employees pension plans, most workers must plan and save up for their own retirements. The Organization for Economic Co-operation and Development’s “The Importance of Financial Education” adds that due to the increase in life expectancy, retirement planning is even more important as individuals will be enjoying longer periods of retirement.
It Will Impact Your Wealth
Wise financial decisions do not happen by accident. It takes know-how and careful consideration of your options to accumulate and manage your funds effectively. And this “know-how” is gleaned from financial education. According to Time‘s “Improving Financial Literacy is Essential to our Nation’s Economic Health,” a joint study by the Teachers Insurance and Annuity Association and the College Retirement Equities Fund shows that people who have a lower degree of financial literacy tend to borrow more, accumulate less wealth, and pay more fees in related financial products. A quality financial education will greatly enhance your future quality of life.
Not All Educations are Created Equal
It is important, however, to clarify that some financial educations are better than others. And, much of this difference in quality has to do with the teacher. The very nature of finance as an academic subject is different from many other disciplines. While grammatical rules and mathematical formulas remain the same for everyone, finances differ from student to student. Each learner must be able to take what they have learned and make wise decisions that apply to their own unique financial situation. A financial educator, therefore, must be highly qualified in their field.
Plus, as “Under-qualified Financial Educators Pose Risk” points out, an educator’s “passion, enthusiasm, and commitment play critical roles in successful student development, and a correlation certainly exists between an educator’s level of personal commitment and students’ financial futures.” A teacher’s appreciation for the world of high finance–coupled with their wealth of knowledge–should be significant factors when choosing a finance course.
Don’t leave your future earnings and financial security vulnerable to poor decision-making. Make sure that your course of study includes an education in money matters. The “you of the future”–the one who retired to sunny Arizona, plays golf every day, and drives a convertible sports car–will thank you.
If you’d like to learn more about the importance of personal finance, check out “On Becoming Financially Responsible.”