By Kate E. Salute
According to the Federal Trade Commission, 83 percent of undergrads have at least one credit card, the average credit card balance for college students is $2,327, and one in five students carries between $3,000 and $7,000 of credit card debt. The average credit card debt for graduate students is $4,776.
To help students avoid accruing debt, high schools have initiated economics and business courses. For Malverne High School, the efforts have paid off.
Each spring, a Financial Literacy Certification Test is administered to high school seniors by the Financial Literacy Coalition. This year, a 50-item multiple-choice test was given to 6,226 seniors from 49 New York City and Long Island high schools. Malverne High seniors proved their financial literacy, earning the coalition's Blue Star School award for having more than 75 percent of students pass. Those who pass are awarded a Financial Literacy Certificate, indicating that they have met New York state standards based on the "Economics, the Enterprise System and Finance" curriculum, a great resume builder.
Of the 49 schools tested, 25 received the award, nine on Long Island.
"This year Malverne had 80 percent of its student pass," said Vincent Romano, the high school's social studies chairman.
This achievement is in no small part due to the teachings of the financial literacy curriculum drawn up by Working In Support of Education, or WISE, a Manhattan-based not-for-profit sponsored by corporations such as the Citigroup Foundation, the McGraw-Hill Companies, Deutsche Bank, the Allstate Foundation, the American Express Foundation and J.P. Morgan Chase.
Phyllis Frankfort, chairwoman of the Financial Literacy Coalition and president of WISE, said, "Thousands of students are entering college and the workplace armed with a true understanding of the benefits and potential problems associated with financial products and services."
"Its greatest advantage is its practical approach to economics," said Romano. "Students learn valuable lessons on budgeting, credit, insurance and financial plans."
Romano added that the financial literacy curriculum gives the students material that they can relate to and, more important, utilize in their post-high school lives. "Our economics teachers have commented about the students' interest levels last year, as compared to previous years," he said. "They've said, '[Students] actually see the value of economics, and it's much easier to keep students focused and excited.'
"Credit card companies target our youth - they advertise a buy, buy, buy mentality," Romano continued. "Unfortunately, our children do not understand how much this is really costing them - they have no idea about interest rates. Our goal is to educate our students on what to look for when determining ... how a credit card should be used."
Frankfort said, "When analyzing the topics, we found, for all schools, that students performed best with the questions on banking and credit, with 71 percent of the questions answered correctly. Seventy-eight percent knew that the best practice is to pay the complete balance on a credit card each month, and 84 percent realized that check-cashing stores charge higher fees than banks to cash checks."
"[We want] to educate the whole person and prepare them for the rest of their life," said Romano. "The financial literacy program increases our opportunity to have this impact. Our students graduate with the basic skills needed to manage money and make financial decisions."
Malverne High's principal, Glenda Good, said, "I am very pleased that our students displayed a high level of understanding in the area of money management. Mastering financial skills at this stage will better arm them for their future endeavors."
Romano continued, "The organization also offers several workshops for parents and students in the community. Workshops focus on financial aid, how to repair credit, setting goals and budgeting, an introduction to investing, buying a home and insurance. This isn't a program that benefits [only] students, but students and parents alike. We would all benefit from such a workshop."
See what West Hempstead High School students are learning about finance in next week's issue.
Comments about this story? Ksalute@liherald.com or (516) 569-4000 ext. 205.
