By Corey Carlisle
For the financial services industry, the pandemic was a call to action in meeting the financial needs of people and businesses affected by COVID-19. It was also a year marked by social unrest and of our country’s persistent racial gaps in income, education, health, wealth, homeownership, and economic opportunity. As classes resume in fall of 2021, banks across the United States will deploy their resources, reach and expertise to provide the next generation, particularly those in underserved communities, with the financial education they need for upward economic mobility and lifelong financial empowerment.
In an ideal world, personal finance would be incorporated into curriculum as early as elementary school and continue all the way through high school, with the goal of having those graduates emerging as independent adult consumers. Financial literacy advocates argue that students who receive financial education are more likely to be able to make sound financial decisions and adapt or build upon those skills for a lifetime of financial well-being. Unfortunately, according to the 2020 Council for Economic Education biennial Survey of the States, only 21 states require high school students to take a course in personal finance. While that is an increase of four states from their previous survey, there are still five states (plus the District of Columbia) that do not include personal finance in any of their graduation requirements.
At the height of the crisis, a Charles Schwab financial literacy survey found that 63 percent of US adults considered financial education to be the most important supplementary graduation requirement, in addition to core subjects such as math, science or English. And while school disruptions sidelined many in-person banker financial education presentations, for many banks the pandemic provided new opportunities to partner with educators to innovate curriculum and reinforce the importance of many key personal finance topics such as budgeting and the need to build up emergency savings.
Amegy Bank, a Houston-based division of Zions Bancorporation, implemented a multifaceted financial education initiative prior to the pandemic designed to address the most crucial needs for financial literacy in the communities across their footprint. The bank also employs a full-time financial education program administrator who oversees the bank’s engagement activities and recruits and trains around 200 volunteers to ensure they are adept in delivering top-quality financial education programming.
Since implementation, the bank has developed strategic partnerships with more than a half-dozen non-profit organizations and with several schools where a large portion of the student population comes from low-income households. Those organizations include the Arc of Greater Houston, which works to promote and protect the human rights of people with intellectual and developmental disabilities, and a United Way agency known locally as the Alliance that helps immigrants and refugees achieve self-sufficiency and improve the quality of their life. Amegy also partnered with local schools and youth organizations, such as Junior Achievement and KIPP Academy, to help address gaps or augment topics they identified in the curriculum of the K-12 school system there.
Honolulu-based American Savings Bank administers its charitable giving through three focus areas: improving education with an emphasis on financial literacy, strengthening families, and promoting innovation and entrepreneurship. In 2015, the bank began holding the KeikiCo Contest, a biennial competition allowing students grades 3-12 from any Hawaii school to participate in teams of two to five. Participants complete an eight-week curriculum, developing a business plan and video pitch. At the end of the program, the best entries are awarded $5,000-$25,000 prizes. KeikiCo is one way ASB is collaborating with public and private partners as well as investing in the next generation of entrepreneurs, helping to develop valuable skills, such as problem solving and critical thinking.
While financial education alone will not solve the problems of economic inequality, school-based financial education still offers great potential benefit to disadvantaged students and those unable to gain sufficient financial guidance from their parents. Bank examples like these show that alignment between banks and schools can be fruitful and that prioritizing outreach to and partnerships focusing on disadvantaged communities, we can build a better foundation for a lifetime of financial learning.