The term “financial literacy” is all over the news these days as the US starts to emerge from recent economic setbacks. But what is “financial literacy,” exactly, and why is it being touted as a solution? Financial literacy is loosely defined as the ability to understand financial matters and to make sound economic decisions for oneself. Balancing a checkbook, setting and sticking to a budget, establishing an emergency fund, using credit wisely, navigating the complex path to home ownership: these are important skills that too many Americans may be lacking. Educating ourselves and our children on financial matters is a good first step to avoiding future economic crises, yet recent studies indicate that traditional approaches to teaching young people about money may not be doing the job.
One tool to building better financial literacy is right here in Washington State: Credit University. Started in 2003 by Alicia Diefenbach, founder of Consumer University, Credit University brings financial information to high school students.
Since the creation of Credit University, Alicia has taught more than 20,000 high schoolers statewide about such things as the value of a good credit score and how to achieve it (or blow it), how to avoid identity theft and what to do if they’ve been a victim, and what compound interest is and why it’s really important to start saving when you’re young. Best of all, she knows how to communicate with an audience of young people.
According to Alicia, “most adults think teens aren’t invested in their personal financial future; they couldn’t be more wrong. This recession has had a huge, collective impact upon teens as the financial choices of their parents have altered their lifestyles. Without fail, the thousands of students I speak to each and every year are concerned about their ability to maintain a good credit score and to start their adult life on the right financial foot. Empowering these students with the tools and information they need to be successful, and doing so in a creative and fun way, is what helps turn teen spenders into teen savers.”
Salal, in cooperation with four other local credit unions, gives financial support to Credit University. Salal President and CEO, John Iglesias, is a firm believer in the value of financial literacy in general and in Alicia’s approach to teaching it in particular: “Young people are eager to learn about money—they know they need the information in order to make smart decisions and achieve their financial goals. But they also want that information delivered in a way that’s interesting and relevant to them. Alicia does that, and it’s why she’s been so effective at promoting financial literacy.”
If you are or have a high schooler who might be interested in scheduling a Credit University seminar at no cost to the school, you can contact Alicia Diffenbach directly at email@example.com.