April marks Financial Literacy Month, a time to recognize the importance of equipping individuals, especially youth, with the knowledge and skills to navigate the complexities of personal finance. As we take this opportunity to highlight financial education, it’s crucial to understand the staggering consequences of financial illiteracy and how it serves as the root cause of so many societal challenges.
Two-thirds of Americans cannot pass a basic financial literacy test, according to a 2023 survey by the Financial Industry Regulatory Authority. This problem is even more acute among young adults.
Nearly 76% of Gen Z respondents felt they lacked the knowledge and experience to effectively manage their finances, according to a 2022 National Financial Educators Council survey.
Research by the Federal Reserve reveals nearly 40% of Americans would struggle to cover a $400 emergency expense. Over 64% of adults live paycheck to paycheck. The consequences of financial illiteracy are profound. Financial hardship doesn’t exist in a bubble — it is often linked to issues such as poor health, housing instability, inadequate education and food insecurity. Communities struggle when individuals are unable to build wealth or even maintain financial stability.
A solid foundation of financial literacy is not only preventative — it is transformative. Knowing how to budget, save, invest, understand credit and manage debt can be the difference between thriving and struggling.
Legislation signed in 2022 by Gov. Ron DeSantis, requiring a half-credit course in financial literacy for high school graduation, raises the question: Is that truly enough? While this is a positive step forward, we must acknowledge that a single course is unlikely to provide the depth of understanding needed to navigate a complex financial world.
Financial literacy needs to be recognized as a critical skill like reading and math, but achieving widespread financial literacy requires a collective effort. Financial institutions, schools, nonprofits and business partners must work together to ensure people of all ages understand the fundamentals of saving, spending, investing and managing credit.
Junior Achievement of South Florida has partnered with Debt.com to teach students real-world personal finance lessons. As part of the curriculum, members of Debt.com and other corporate partners have the opportunity to help students understand how money and credit cards work — and how to avoid overspending. This model shows how education, businesses and nonprofits can unite to address this issue and make a lasting impact.
While Junior Achievement of South Florida programs primarily focus on workforce education and training, we embed financial literacy into every program. We believe if young people earn money, they must know how to manage, save and grow it. Through our partnerships with Broward County Public Schools and businesses like Debt.com, we offer hands-on education and experiences where students learn the basics of budgeting, banking and making sound financial decisions, while learning about careers and work skills.
The stakes are too high for us to continue to view financial education as an elective or a supplementary skill. Our state legislators, governor, Department of Education and Department of Labor are all focused on building a robust workforce pipeline. How can we adequately prepare young people for the workforce without providing them with the tools to manage their own finances?
Financial literacy is the lifeline that can prevent financial hardship from taking root in our communities. It empowers people to make informed decisions, build generational wealth and contribute positively to the economy. We must continue to expand our efforts and ensure that every individual, regardless of age or background, has access to these essential skills.
Laurie Sallarulo is president and CEO of Junior Achievement of South Florida and Howard Dvorkin is chairman of Debt.com.
