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Releases
& Statements
FOR IMMEDIATE RELEASE
November 26, 2007
Contact: Sarah Krauss
212.669.4691; 917.541.0936
Release #: 067-2007
Gotbaum: Financial Literacy Essential for All Graduating High School Students
- Public Advocate proposes mandatory curriculum on importance of saving, perils of debt -
MANHATTAN – Public Advocate Gotbaum today called on the Department of Education to implement a new, mandatory high school financial literacy curriculum, including introductions to budgeting, investments, and the dangers of credit card debt. A 2005 study of college students in New York State found that the average credit card debt for first year students is more than $1,500, escalating to over $3,000 by the fourth year of college.
Gotbaum, joined by representatives from the Council of Urban Professionals and the National Association of Securities Professionals, New York chapter, said that financial competency becomes especially critical given the recent sub-prime mortgage meltdown and the record number of foreclosures facing New Yorkers. And yet, while some city schools offer courses on financial literacy, programs are offered on a school-by-school basis, leaving many students without the basic knowledge to make smart financial decisions.
Public Advocate Betsy Gotbaum said, “Mounting credit card debt, little or no savings – these are realities facing New York City students, and in part because we’re not giving them basic financial knowledge. It is critical for high school students to know how to make smart money decisions before they enter college or the workforce. The earlier we give students these life skills, the better off they will be.”
“We are pleased to stand with Public Advocate Gotbaum today to support her plan to prepare New York City students to be financially self-sustaining,” said Tarrus Richardson, Chair of the Council of Urban Professionals. “This financial literacy curriculum represents the sort of investment in young people that we should be making.”
Reggie Scantlebury, President of the National Association of Securities Professionals, said, "There is a serious need, among people of all ages, for financial education programs that teach the basics of saving, investing and borrowing. With their enhanced ability to access information, now more than ever before, students need to be given the tools and knowledge to make smart decisions. Basic money skills are essential and I am happy to see the Public Advocate address this important issue."
The financial literacy curriculum should teach basic money management skills, such as choosing a checking account over a check cashing center which charges high fees, and the importance of a credit rating, as well as more advanced concepts about investing, saving for retirement, and insurance.
In 2005, one-fifth of credit card holding college seniors had credit debt between $3,000 and $7,000. These debts are often in addition to the mounting student loans many face upon graduation. Additionally, the debt problem grows during college; almost all second-year college students have a credit card, compared to only half of entering first-year students.
Learning the dangers of high-interest credit cards before they are inundated with offers would help many students avoid a dangerous cycle of debt. Currently, the minimum age to apply for a credit card is 18 years old.
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