Personal Finance Lessons That Should Be Taught in High School

by Guest Contributer to Money Q&A

The following is a guest post from Briana Myricks who writes at her blog, How’s Married Life?

High school teachers emphasize preparing for the real world, but in reality, how many of the things you learned in high school do you use today? Has The Scarlet Letter been mentioned at any time outside of a classroom? Do you utilize your US history lessons when it’s not an election year? Besides knowing what H20 means, what elements do you remember from chemistry class?

Part of a valuable high school education should include things you will definitely experience in the real world. One subject that should be taught is personal finance, as that’s something that can be used even before a student graduates. Since personal finance is such a broad subject, what topics specifically should be taught in high school?

How to balance a checkbook: Even though checkbooks and ledgers are going a little out of style with the use of debit cards and online banking applications, students should know how to balance a checkbook. This essential step is all about knowing how much money you have, especially after making a deposit or a purchase. Once a student gets the hang of balancing a checkbook, they have a better grasp of what money management is.

How to save for an emergency fund: High school students love to live in the moment, so very few of them actually think about something happening in the future. Learning about saving for an emergency fund is very important, as it will give them a head start for saving. They should know what constitutes as an emergency, which is something even some adults have a hard time grasping.

How to set up a budget: Budgeting is going to be important, no matter how old someone is. Learning to set up a budget includes knowing your expenses and your income, and ensuring the two will leave you in the positive, or at least breaking even. Without a budget, you have a disconnect as to what you may be spending and paying for. Setting a budget, even when you’re in high school, helps you keep track of how much disposable income you have after your expenses are paid for.

Investing basics: When you hear from the experts, many of them emphasize that it’s never too early to start investing. When students learn the basics about what’s included in investing and how to do it, it may spark their interest to look into it further, or give them a general idea of it if they ever become interested in it later on in life.

Insurance basics: High school students may have heard about car insurance or phone insurance, but again, there’s a disconnect to it since they usually don’t pay for it. It’s important that they learn what insurance is, how it works, and what it can be used for. There’s no doubt they’ll need to know about things like deductibles, and it could be sooner than later that they need the knowledge.

How to manage credit: Once students graduate from high school and go off to college, that’s a time where they become vulnerable to credit card companies, and when many students find themselves discovering debt. Teaching them ahead of time, before they rack up debt, is extremely important. Students need to know what credit is, how to look for interest rates, and learn the importance of paying back the money they borrowed in a timely manner.

These lessons are sometimes learned the hard way in adulthood, but if personal finance is included in high school curriculum, students can avoid the hard lessons.