Spending and Saving

Why Financial Literacy Is Important For Students

The knowledge your child will obtain with budgeting and planning can significantly benefit them as they get older.

Teaching students the ins and outs of financial literacy may not seem like a priority to many people. After all, they are young and make very little to no money – so what’s the point? 

However, financial literacy extends far beyond the student’s current situation. When you think about how the knowledge can benefit them as they start to get older and earn more money, you will better understand why financial literacy is important for students.

To help get you started on the conversation with the students in your life, we have established a few talking points and gathered some resources that will help highlight the most critical components of the discussion.

It Teaches Them the Value of the Dollar

For most children, the concept of money and the value associated with it is a bit of a mystery. Due to having minimal bills (if any), few obligations, and not much of an income, they don’t understand how it all works in the real world. 

However, finding opportunities to create exposure can be a fun experience for them and you. For example, as a parent, you can give your child the chance to determine how much they can purchase for a set amount of money by sending them into the grocery store with a specific amount of cash and a grocery list. 

Additionally, some schools operate stores within their buildings to teach this same lesson. At times, teachers or a student organization will have a stand to sell trinkets, school supplies, and snacks to students during breaks and lunch periods. With this being separate from the lunch program, children are responsible for obtaining their own money and budgeting accordingly. 

These situations will help students see the actual cost associated with goods and services, the information they may not understand otherwise. 

It Prepares Them for the Future

In the year 2020, the average consumer debt sat at $93,000. For many young students, this amount won’t mean much. However, when you sit with them and break down the amount it would cost them every month to pay it off and what the interest ramifications would be, they will start to understand the enormity of the amount.

These conversations are great opportunities to explain the terms associated with financial literacy. Words such as interest, escrow, APR, and the different fees are new and unknown to many students.

As students get older and start receiving offers for credit cards and lines of credit, the early conversations surrounding debt and interest will play in the back of their minds. With this information, they are more likely to go forward, making good choices for themselves financially. 

It Allows Them to See the Big Picture

Early conversations about financial literacy will help students paint a picture for the future. Knowing what things cost and how debt impacts other components of their life will dictate what they want out of their future.

These conversations will play into their career plans, the location they live in, and what goals they have for themselves. With this information, they can even start implementing early strategies to help them meet their future goals.

Some of this information can get a bit overwhelming for young adults, so it’s essential to have the conversations in segments and not all at once. 

As a result of the open dialogue and the financial literacy they have gained, your student will have a tool kit of budgeting resources and an arsenal of information to take them forward. Although they may deviate from their learning at times, they will always have it to turn to as a way to right their track.


Teaching young students about financial literacy often seems unnecessary due to the limited monetary resources that they have. With their young age, employment is either not possible or is at a limited capacity. 

It’s important to remember that financial literacy extends far beyond the student’s current situation. The knowledge they obtain with budgeting and planning can significantly benefit them as they get older. 

This article contains talking points and resources to aid you in this critical conversation with your students. At the end of the discussion, you both will understand why financial literacy is important for students.


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