EC&I 861 has taken me on a self-guided journey exploring where and how financial literacy is being taught. I also looked at some of the research surrounding the teaching of financial literacy and personal finance topics and its effectiveness. My learning journey took me in a direction that I didn’t expect to travel.
When I chose the topic of financial literacy for this course, and my thesis, I didn’t choose it because of a personal passion towards the subject, but instead an observation of a need for education in the area. As it is a topic out of my area of specialty it took me awhile to figure out where to go with my interest and what the proper terminology was for some of the things I was interested in.
Starting my research I was impressed with how much literature I found on the topic and how many other provinces/countries have already implemented mandatory financial literacy education. I came in to the course with very idealistic expectations about what effect mandated financial literacy education would have on student’s future financial health- but the research quickly brought me back down to Earth. I found myself questioning whether it was worth it to teach financial literacy at all when so much research is showing that it isn’t effective anyway, but still holding on to my gut feeling that there is a need for the education in our society.
The main points of my research told me that there wasn’t a large difference in performance on financial literacy tests between students who had taken personal finance courses or been schooled in states with financial literacy mandates. There was also a lot of discussion about the nature of learning behaviour-based practices and the complexity of decisions to be made in the constantly changing finance world.
I feel as though I have now moved past that discouraged stage and discovered many of the reasons why the research is producing such discouraging results. While I believe that countries, provinces, and states have great intentions when setting mandates surrounding financial literacy education, I think it is the implementation of these mandates that have left student results falling short of the desired outcomes. I think the number one issue is that teachers left to teach these complex topics are not properly trained to do so- leading to things being taught superficially, or just plain incorrectly. I think the 5 essential strategies suggested by the SOTS for advancing financial education are important (except #2) and should be considered if/when we mandate financial literacy education in SK. They are as follows:
- Introduce financial concepts early and continue to build on them through K-12 years. It is encouraged to make a stand-alone financial education course a graduation requirement for high school students.
- Include personal finance questions on standardized tests.
- Provide K-12 students opportunities to practice money management through hands-on learning opportunities.
- Provide opportunities for teachers to complete financial education training.
- Encourage parents to discuss money management topics at home and provide them with the tools they need.
I think that most important if/when SK moves towards mandated financial literacy education should be properly funded teacher training and a stand-alone course for concepts as well as integrating them in to other courses. I think we need to avoid a blanket approach of a broad-based mandate where already busy and overwhelmed teachers easily overlook the importance of the content (and are likely unqualified to teach it anyway).
This class has also taught me that Canadian financial problems are far more complex than simply cognitively understanding how finances work. I have realized that financial literacy is not the answer on its own, but instead an important starting point for dealing with financial issues currently faced by our society such as high debt levels. It has also taught me that financial literacy has some important, elementary basics: spend less than you earn. It is possibly to be financially healthy with less money that most of us make- we just need to adjust our expectations and our spending in line with our income.
As a final step for this class I read Predictably Irrational by Dan Ariely. It was Lauren Willis who suggested that if you can predict something you can change it. I love how beautifully this concept fits in with the title of Ariely’s book- suggesting that humans act in a predictable way, even when it doesn’t make rational sense.
Ariely also played a large role in influencing my opinions towards what needs to be taught. I started the course thinking about personal finance as mostly a Math-based course, but I now appreciate how much more complex financial literacy is and how much marketing and social science needs to be understood as well.
As effective marketing strategies continue to increase our levels of consumerism I think the need for good financial literacy/personal finance education here in Saskatchewan continues to grow. We need to not be discouraged by the research suggesting that financial literacy education is ineffective and instead use the knowledge learned to guide HOW we teach it.
I had an incredible learning journey in EC&I 861 and I hope that I was able to communicate my learning experiences for you. I look forward to moving forward with the topic of financial literacy education in Saskatchewan as I start my Thesis learning.