Nebraska students edge peers in financial literacy
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By JEAN ORTIZ/Lincoln Journal Star
Nebraska high school students may have a slight edge on their peers nationally when it comes to understanding personal finances, but the news released this week by a national coalition wasn’t necessarily good.
In a biennial survey administered by the Jump$tart Coalition, a national group working to improve the financial literacy of today’s youth, Nebraska high school seniors correctly answered 50.8 percent of the questions.
“I think there’s a lot of room for improvement,” said Jennifer Clark, president of the Nebraska Financial Education Coalition, an affiliate of the national effort .
48 — percentage who correctly said a credit card holder who pays only the minimum amount on monthly card balances will pay more in annual finance charges than a card holder who pays their balance in full.
17 — percentage who correctly answered that stocks are likely to yield higher returns than savings bonds, savings accounts and checking accounts over the next 18 years even though there has never been an 18-year period when this this wasn’t true.
40 — percentage who correctly answered that they could lose their health insurance if their parents become unemployed.
36 — percentage who think a house financed with a fixed-rate mortgage is a good hedge against a sudden increase in inflation, compared with 45 percent in 2006.
Source: Jump$tart Coalition
Students coming from families earning more than $80,000 fared slightly better, answering 54.2 percent correctly. Their peers coming from household incomes ranging from $20,000 to $40,000 answered 51.7 percent correctly.
When breaking the results down by gender, males answered 52.1 percent correctly. Females fell behind slightly with just 50.1 percent correct.
This was the first year Nebraska students participated, so that offers a baseline, Clark said.
By continuing to support teachers who see the importance of incorporating financial topics in the classroom and by related efforts, coalition members and others with stake in the issue can only hope to see improvement, she said.
The foreclosure crisis, higher education financing and credit cards are among the challenges today. Students heading out into the real world need a solid financial understanding more than ever, she said.
“In today’s economic environment it’s so critical that they have those skills,” she said.
Nationally, high school seniors answered only 48.3 percent of the questions correctly, a drop from 2006 results that had them correctly answering 52.4 percent.
More than 6,800 high school 12th graders in 40 states participated.
Students from 19 Nebraska public high schools took the 31-question survey. The schools were selected randomly and include a mix of large urban and smaller rural schools across the state.
The coalition did not identify the schools nor the total number of students surveyed.
Students were administered the paper test in classes that didn’t deal directly in personal finance or economics in order to provide an accurate representation of what the average high school senior knows, Clark said.
Reach Jean Ortiz at 473-7107 or jortiz@journalstar.com.
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