Considerations When Teaching Financial Education

Each person you are teaching has pre-existing financial behaviors, past experiences with money, and a unique financial situation. Due to these factors, the subject of money can evoke strong feelings and reactions in people that must be addressed by the educator.

Teaching financial literacy requires unique skill sets that bridge educational mythologies, subject matter expertise, behavioral finance, and psychological understanding. To bridge these fields effectively, financial educators must possess cross-disciplinary skill sets from each area to help students work toward a state of financial wellness and security.

Childhood Influencers of an Individuals’ Finances

People’s upbringing directly affects their ability to manage money, how they feel about the topic, and financial habits they develop. The relationship a person develops with money starts in childhood. Consider these 5 areas:

Financial Situation

Each child is born into different challenges that will have major impact on that child’s future financial situation.

Financial Behaviors

The behaviors they develop as children – influenced by parents, the environment, advertisers, and peers – are primary indicators of their future finances.

Financial Sentiment

Also formed at an early age is a person’s financial attitudes and beliefs, which in turn influences his or her willingness to work toward a more secure financial future.

Financial Education

Most kids will never receive a high-quality financial education. Parents and schools are failing to produce self-sufficient individuals.

Financial Management Systems

Most children will leave home lacking the basic systems they need to get off on the right financial foot.

Adult Influencers of an Individuals’ Finances

Financial behaviors, sentiment, knowledge, and management systems start forming in childhood and often form into habits by the time a person reaches adulthood. The problem here is that, once habits form, they are difficult to break and therefore one’s financial situation becomes harder to change.

Financial Situation

Many people make mistakes early in life that take many years to overcome, putting them behind in important financial areas they should address.

Financial Behaviors

Financial habits are formed young, and data show that people in general have common behaviors that take them farther away from financial wellness.

Financial Sentiment

As people age, they get more stuck in how they feel about their finances. Avoidance, fear, and worry are common sentiments people develop toward money.

Financial Education

Most adults never receive a financial education; instead, they get their money knowledge from unreliable sources like web searches, friends, and financial servicepeople who sell products.

Financial Management Systems

The data shows that many adults lack the financial systems they need to work toward their financial goals and make managing money easier.

Overcome the Challenges to Teaching Personal Finance

Although teaching personal finance poses many challenges, those challenges can be overcome and you can make a real difference in people’s lives. There are important steps to consider when planning your program and building the skills you need to teach this unique subject because a persons finance affect many areas of a their life. Consider these main areas to address:

Qualified Educator

The backbone of any program is having an educator with the skills to teach effectively.

Design for Learner

Understand the learners’ needs and life stage to teach subjects that matter most to them personally.

Quality Materials

Materials should be developed around research-based educational methodologies and practical application.

Positive User-experience

Care should be taken to create a professional learning environment for participants.

Data-driven Modifications

Measurements should be taken and the data analyzed to make modifications that enhance learning.