A high-school senior about to graduate very possibly will go through life with a severe disability, according to financial professionals.
That’s because he or she likely has received little or no personal-finance education.
“The problem of financial illiteracy is perhaps the greatest threat facing our country,” according to John Vento, a Staten Island certified public accountant and adviser.
Only 17 states require a personal-finance course for a high-school diploma — and New York isn’t one of them.
These numbers come from a new survey by the Council for Economic Education (CEE), a New York-based organization devoted to promoting financial literacy and economics education in elementary and high schools.
At a minimum, teens should be able to budget, save and spend wisely, said Kelli Ramey, director of H&R Block’s youth-education program Dollars & Sense.
Without better financial education, Vento claimed, millions of young people will face a life of constant money worries. The author of the book “Financial Independence,” Vento warns that problems of financial illiteracy are passed from generation to generation because parents often lack financial literacy, too. He believes this lack of basic money knowledge has already hurt the economy, with too many young people taking on mortgages they never understood.
“I believe it is one of the reasons for the market meltdown of 2008,” Vento argued. “And if you don’t understand how to compute interest and the difference between a stock and a bond, your chances of prospering or even surviving financially are almost nil.”
The trouble starts early: 81 percent of college students surveyed miscalculate their student loans and how long it will take to pay them, according to the CEE.
But even if the state graduation requirements change, there may be yet another problem: “Fewer than 20 percent” of the teachers in the CEE survey said they would be confident leading personal-finance courses.