Upon graduation from high school, young adults become more and more responsible for their personal finances and take their first crucial decisions like student loan management and personal expenses. These financial choices become more complicated once they graduate from college as they now need to face mortgage payments, student loan repayments, and saving for retirement.
Researchers identified that financial literacy is an essential indicator of people's ability to make sound personal financial decisions. The literature on financial literacy has also documented an alarmingly low level of financial skills and knowledge both among adults and young adults. For instance, in a recent paper, (Annabi, González-Ramírez, & Müller, 2018) surveyed undergraduate students at Manhattan College and asked eight questions on various dimensions of financial knowledge about the concepts of liquidity, risk and return, diversification, numeracy, compound interest, interest rate and inflation, time value of money, and money illusion. Their principal findings confirm previous research that gender and race correlate with financial literacy among college students. Women scored lower than men, with women of color scoring lower than white women, and Hispanic and African American men scoring lower than their counterparts. Moreover, first-generation students scored lower on some financial knowledge questions, like numeracy. Following these results, it became clear that there is an urgent need to address financial literacy gaps not only among Manhattan College students but also High School students in our neighborhood by offering personal finance workshops and seminars.