Financial Education Classes Key to Preparing All Students for Post-High School Money Management Responsibilities

With high school graduation and summer just around the corner, many young adults will soon be experiencing newfound freedom and heading out into the world on their own. For many, this next chapter in life also means taking on the new financial responsibilities without the help of their parents. Capital One Financial Corporation (NYSE:COF) recently surveyed high school seniors to see how prepared they are to manage finances on their own.

Although the survey data shows the majority of soon-to-be male graduates believe they are ready to take on these new challenges, the female students are less certain of their ability to manage their finances on their own.

According to the survey, two-thirds (65.4 percent) of the male students rated themselves as “highly knowledgeable” about personal finance compared to less than half (49.2 percent) of the young women who participated in the survey. While the gender differences are surprising, these numbers also show a striking correlation between the students’ confidence about their financial knowledge and whether or not they had participated in a financial education class, with 45 percent of the male students surveyed and 61 percent of the female students reporting that they have never taken a personal finance class.

Overall, one-third of the students (33.8 percent) said that they were either unsure or unprepared to manage their own banking and personal finances.

“It’s clear that financial education, or the lack of it, has an impact on students and the level of confidence they have in their ability to manage money on their own,” said Diana Don, Director of Financial Education at Capital One. “"Basic money-management skills are important building blocks for economic self-sufficiency and success and it’s important that all students understand the fundamentals of personal finance when they graduate from high school."

Early practical experience with money and banking helps establish good habits

Real world experience also prepares seniors for the financial challenges and independence they will face upon graduation. Eighty percent of the high school seniors surveyed report that they have had a bank account for one to two years and that they are regularly checking their account balances. Most of those with checking accounts (73 percent) balance their checkbooks at least once each month and one quarter report that they check their bank account balances weekly for activity and errors. The vast majority (85 percent) of the students also said they at least periodically set money aside in savings. However, only half of the students surveyed (50.6 percent) use a budget to manage expenses and savings.

Parents are a primary resource

The majority of the student’s participating in the Capital One survey (70 percent) reported that they, at least occasionally, look to their parents for advice about money management and personal finance.