Financial Literacy Team Formed
FLAGSTAFF (AUGUST 14, 2018)
One of the greatest obstacles that hinder the transition from high school to post secondary training and education is a lack of financial literacy amongst students and their parents. There is a lack of quality financial literacy programs and awareness of the few programs that do exist is scant.
This was one of the conclusions realized by members of the LAUNCH Flagstaff Post Secondary CAN in their effort to increase the number of high school students completing the Free Application for Federal Student Aid (FAFSA) during last school year.
Because of this lack of basic financial understanding, too many young adults and their parents make post secondary training and education decisions with little awareness of the future impact on their personal finances. The result is that the student loan default rate has climbed to nearly 35% nationally, with only one half of all college students repaying their loans in full after 20 years.
As these students move into adulthood, their financial mistakes compound resulting in increasing personal debt. The national average debt to income ratio for all adults in the United States stands at 39%. Experts say that a ratio above 30% is financially unhealthy.
This prompted several Post Secondary CAN members to convene a separate group of community stakeholders to dive deeper into this aspect of post secondary training and career planning.
The Financial Literacy Team’s shared goal is to align their existing resources to provide financial literacy and empowerment to Flagstaff’s youth and adults so they develop sufficient skills that can lead them towards financial abundance, wellbeing, sustainability and resilience in the face of changing economic circumstances.
The team first met on June 20, 2018 and formally adopted a charter of purpose on August 1, 2018. Read their charter here.
Initially they seek to focus on addressing the needs of youth and adults aged 15 and up, with the recognition that financial literacy begins with a grasp of mathematical concepts in the early years of child development. The team recognizes the overlap of their work with the Early Learning CAN, particularly around their objectives of improving literacy in language and mathematics.
The Financial Literacy Team is currently conducting a review of existing financial literacy programs in Flagstaff using a tool created by the Consumer Financial Protection Bureau (CFPB). From this they hope to identify gaps and overlaps in services from which they will facilitate improved alignment to improve financial literacy in our community. Learn more about the actions they are taking here.