"IN ORDER to get our children to have confidence in managing their money there has to be a combined effort in schools and at home," said Ted Beck, the president and CEO of the National Endowment for Financial Education.
Ted Beck is the president and CEO of the National Endowment for Financial Education (NEFE). He also serves on the President's Advisory Council on Financial Capability and is the national chairman of the Jump$tart Coalition for Personal Financial Literacy. He spoke to students on Monday, May 14 at East Greenwich High School and at the Rhode Island Jump$tart Coalition's eight annual Celebration of Financial Literacy Leadership.
PBN: Can you give us an overview of the mission of the National Endowment for Financial Education?
BECK: NEFE provides financial education and practical information to Americans at all financial stages. NEFE believes that regardless of background or income level more financially informed individuals are better able to take control of their circumstances, improve their quality of life, and ensure a more stable future for themselves and their families.
NEFE facilitates ground-breaking research in personal finance education and offers a variety of resources for use in the classroom all the way through to retirement. All NEFE resources are absolutely free.
PBN: You have advised two presidents on financial capability. What do you feel are the most significant efforts that have been made by the last two administrations?
BECK: Both administrations of President Bush and President Obama have shown strong support in increasing Americans’ access to personal finance education. They have seen the importance of this issue and established these non-partisan councils to increase financial education not just in schools, but also in the workplace. It has been a tremendous task, but both councils have taken a broad approach to look at what works and has the greatest chance to reach people at all stages of their lives.
There also has been unwavering support from Secretary of Education Arne Duncan, who was co-founder of the Ariel Academy in Chicago. He has made a personal commitment to ensure that students are having the opportunity of exposure to personal finance education.
PBN: I understand you have been working on a pilot program with teachers across the United States. Can you tell us about this?
BECK: What we have learned through NEFE research is that just 29 percent of educators in K-12 are teaching financial education in any way, yet they overwhelmingly recognize the importance of teaching their students how to manage money. One barrier we are working to overcome nationally is that teachers do not feel confident teaching personal finance. Teacher preparation is critical and we have worked through the Jump$tart Coalition to develop a teacher training program to meet this need. What we have seen in Rhode Island from teachers that are delivering personal finance education is that they are highly qualified and extremely competent. The state of Rhode Island does not have any formal mandates in place so these teachers are doing this is an elective capacity. This is encouraging.
PBN: Is there a critical age for parents to begin teaching children about how to handle their finances?
BECK: This should be done early and often. In order to get our children to have confidence in managing their money there has to be a combined effort in schools and at home. Parents have the most influence in how their children will establish behaviors in terms of managing their money so it is important to set positive examples and not lecture. These conversations should be age appropriate. Parents can take advantage of teachable moments by not shying away from telling their children how the family economy works.
PBN: What role should schools play in personal finance education?
BECK: Effective financial behaviors come from continuous access. Certainly, parents are the strongest influencers of how children will learn to manage their money, but we cannot ignore the influence that schools and peers have. We need to do more in our schools nationally to recognize that we are teaching our kids a life skill that they will use every day throughout their lifetimes. Parents and teachers must provide knowledge and encouragement so that future adults will enter the real world with the building blocks toward creating a solid financial future, which in turn, will strengthen our national economy.