It is no surprise that credit card companies, banks, and loan companies spend an incredible amount of money on marketing their products to consumers. To make matters even worse, the majority of their marketing efforts are seen by young consumers who have not had the benefit of receiving education on making good money decisions.
A new study conducted by the Consumer Financial Protection Bureau found that $17 billion is spent every year on marketing compared to the $670 million spent on financial education. The study shows that only $2 per person is spent on educating consumers about making smart money decisions. This disparity in spending gives consumers little unbiased information regarding financial planning.
By not having the proper education regarding smart financial planning, young people make mistakes that can have long term repercussions. A recent survey of individuals 18 and up found that most consumers believe that children are receiving little to no education regarding financial management. Students who receive some form of personal financial education have more success in future financial planning than those with no economic education. Currently only 14 states require any kind of financial education and the numbers are decreasing each year.
It is imperative that education on personal finance and planning be part of any curriculum. By educating the next generation, we can raise competent, smart consumers.
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