NIXA, Mo. — The millennial generation’s lack of knowledge about how to manage their personal finances could be ‘disastrous for the economy’, say financial experts.
“As a parent it’s scary. Seeing these kids it’s scary,” said Nixa High School teacher, Pam Stringer.
That is when teachers like Stringer learn just how little their millennial-aged students know about personal finance.
“They are struggling with savings. They are struggling paying debt. They don’t realize that that credit that they’re using actually comes at a price,” Stringer said.
A recent study by Price Waterhouse Cooper and George Washington University finds that of the more than 5,500 millennials, or those born between the early 80s and mid-90s, only 24% demonstrated basic financial knowledge.
“A great deal of them really truly do not know how to manage a bank account. They just depend on their debit card and if it declines then they must be out of money and that’s why they’re defaulting to things like pawn shops and easy ways to get money,” said Holly Signorelli a certified public accountant and also known as The Money Therapist.
About 30% of the millennials surveyed have overdrawn their checking accounts, and 42% used either a pawnshop, auto title loan, or payday loan.
Also, four out of five of them have major debt such as student loans.
“It’s not necessarily the parent’s fault. It’s just society needs to change. There needs to be better curriculum,” Signorelli said.
Like, Signorelli said, the personal finance course that’s been required of all Missouri high school students since 2010.
“Hopefully, through our current education movement we’re able to move them to a place where they can track their earnings, track their spending, and track their savings,” Stringer said.
“That’s the future and if this continues then I don’t know where we’ll be in ten years because they’re going to be not having any credit, or being able to buy houses. Things that were just considered to be normal all along,” Signorelli said.
Missouri is one of 17 states that requires all high school students to take a personal finance course.