Financial literacy is a must

CAMPUS ISSUES: UC Berkeley students should take advantage of available resources so they can learn to manage their own finances.

As a result of our country’s competitive economic landscape, current UC Berkeley students more than ever need to become fiscally savvy in order to stay afloat. While it’s true that the obstacles faced today by college students are more challenging than at any time since before World War II, this should only embolden young Americans to learn more about how to manage their own finances.

Mastering credit card debt, student loans and tax returns, among other adulthood burdens, is no easy task for anyone becoming accustomed to financial independence. According to a 2011 survey by the credit card company Capital One, 36 percent of recent college graduates say they are not setting aside savings on a regular basis. A full 60 percent are at least somewhat worried about their ability to pay back loans.

While walking a financial tightrope leaves little room for mistakes, educating students about important personal money-related decisions can help to lift some of that pressure. In a May 2013 statement given to the Financial Literacy Education Committee, U.S. Treasury Secretary Jack Lew stressed the importance of making sure “young people can plan and save for the long term … and that they can handle income shocks while still achieving their personal and financial goals.” On that front, UC Berkeley has a number of useful resources available.

UGBA 196, personal financial management, is a two-unit lecture focusing on personal finance and how to manage money safely over time. There’s also a student-faciliated DeCal course, UGBA 98/198, that teaches students the basics of financial literacy and sets up student-run workshops on basic money management in Oakland. The availability of these classes, while significant in their own right, is still just one step in the right direction.

The ASUC and campus administration should work together to promote further programming that educates students about basic financial facts and smart investment behavior. For example, a productive goal would be to set up workshops on filing taxes and handling credit card debt properly.

Recent studies show that 50 percent of new college graduates find themselves in a line of work unrelated to their degree, and millions across the country struggle to make a living wage; it’s fair to say a broken economy is to blame for many of the money problems of young Americans. Courses teaching the basics of personal finance should not be substitutes for the problems of the economy, but should complement the institutional reforms needed to fix our economy.

 

This editorial appeared in the Oct. 8, 2013 edition of the Daily Californian.