I recently attended a financial literacy graduation ceremony for 52 high school seniors at Armijo High School in Fairfield.
The program teaches, assesses and certifies students in critical financial skills. The technology uses virtual worlds, gaming, social media and videos to teach critical skills, from using credit cards wisely to financing higher education. It is used by nearly 5,000 high schools in all 50 states and meets all national and state requirements for financial literacy.
One student commented that before completing the program, he had no idea how a debit card differs from a credit card. Other students expressed how their new skills will benefit them for years to come, including steps they can take to build and maintain good credit, avoid unnecessary debt and save for retirement.
More than one student commented on practices they observed their parents using, such as non-bank check cashing services; they could now educate their parents on other options available at a fraction of the cost.
I've been a California community banker for more than 30 years, and I'm proud of our long-standing commitment to financial education. California's banking community understands how critical a strong financial education foundation is to the future success of our children.
I'm also a mother whose children attend public schools. It is imperative that our children learn how to budget, save and plan for their future.
A recent survey of U.S. teens by EverFi, an education technology company, revealed stark facts about how unprepared graduating high school students are regarding the management of their finances.
For example, on average, students believe a good credit score is about 500, and more than a third believe that a good credit score is 300 or less, when it should be 680 to 850.
And, nearly half of high school students said they do not know how to establish good credit, and more than 25 percent said they will not be prepared to manage their finances upon graduation.
In addition, 83 percent of students believe that personal finance education should be mandatory in schools. However, only four states require at least a semesterlong course devoted to the topic, and less than half of the states require personal financial education to be integrated into other subject matter.
The importance of our youths having a strong foundation in financial education has not gone unnoticed by Richard Cordray, director of the Consumer Financial Protection Bureau. In April, his agency recommended that policymakers incorporate a nationwide financial education program into grade school curriculum, as well as into standardized tests.
In a white paper issued on the subject, Cordray called the current process "utterly unacceptable"; consumers today learn mostly by trial and error. Beyond grade school, the bureau is asking for additional personal financial education in high school, including a state requirement for a stand-alone financial education course to graduate.
Cordray is pressing for the programs to include some form of "practical experience" such as banking simulation or computer gaming on financial education.
California banks are doing their part to support financial education programs among our youths. Bankers have been longtime advocates of programs that help prepare youths to make smart financial decisions; banks offer financial management products and services that can help students learn to save and establish credit responsibly.
That's why California's banking community supports Assembly Bill 166 requiring California's superintendent of public instruction to incorporate financial education instruction into the state's school curriculum, including important topics such as budgeting, managing credit, student loans and managing debt. The Senate has passed the bill; it is now in the Assembly.
At the graduation ceremony at Armijo High School, I was moved to observe how proud the students were from completing the course. Those students are now certified in more than 600 topics related to personal finance, all topics vital to preparing the graduates for the responsibilities that lie ahead.
I hope we can count on the Legislature to make financial education a component of our state's school curriculum.
Louise Walker is president and CEO of First Northern Bank, based in Dixon. She also serves on the board of directors of the California Bankers Association.