In order to fulfill the goals of Auburn's mission statement, students should be coming out of the university as well-rounded individuals. While being well-rounded can vary person-to-person, we suggest that students make an effort to educate themselves in personal finance through Auburn's personal finance course.
Registering for a personal finance class teaches students basic financial knowledge, which is beneficial alongside a college degree upon graduation. Budgeting and making a portfolio also allows students to be proactive when transitioning into adulthood.
As of 2021, 56% of Americans considered themselves well versed in financial literacy. Four out of five Americans are knowledgeable about their credit score, their loans and their credit card debt, leaving 44% not particularly confident about this information.
This study also shows Americans owe $1.03 trillion in credit card debt and 23% of adults have credit card debt that is over 90 days due. 34% of adults claim they’re “just getting by.” However, it also shows that adults with a bachelor’s degree are more financially literate.
Financial stability looks different for everyone based on their major, goals and the standards of their generation. Generally, financial freedom has been thought of as the ability to meet financial obligations, living comfortably and having some money left over. The reality now, is that many people have shifted the definition. Social media and influencer culture has set an unrealistic standard over our generation. In this age, we believe that a personal finance class would ground students from unrealistic expectations and standards set by our culture today.
Our generation is starting to learn about financial independence, so they’ve started paying their own bills and rent. Some may work throughout the summer or winter breaks so they have enough money and flexibility during the school year. Others give themselves an allowance for the week before and after paying their bills, but the uncertainty of the cost is daunting.
We’re also becoming more literate in the world of stocks and cryptocurrencies to achieve financial literacy and responsibility. A CFA institute study showed that in 2023, 56% of Gen-Z owned some type of investment.
Having investments like these can be tricky if you have no guidance or previous knowledge of what these investments entail and how they allow you to gain money. However, taking a personal finance class would allow you to explore the world of investments.
This class also offers insight into having a 401k, emergency funds, loans, how credit works and how planning would be beneficial to you in the future. It also prepares you to understand the “time value of money.”
A 2021 TIAA study shows that Gen-Z is the least financially literate out of the five current generations. The study also shows that our generation is the most literate in borrowing and saving, while we know the least about insuring. Though, this same study shows that 48% of Gen-Z participants has been offered or taken a financial literacy class.
Further, there is a stigma around studying what you enjoy and making enough money to achieve financial freedom. Along with paying loans, rent, external bills and groceries, it might be difficult to study a passion while also meeting needs and responsibilities. Studying what you love might mean going without spare income for a little while and hustling for a certain quality of life.
This stigma is why we think a personal finance class would be beneficial to students. Elective classes aren’t always beneficial to students and their future careers, but students can take advantage of those credits and choose to take a class that can enrich their mind and their future.
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