Financial education is falling short—not a shocker but always dispiriting, especially when it’s put to numbers. T. Rowe Price did just that in its 10th annual Parents, Kids & Money Survey, which revealed (again no surprise) that receiving financial instruction in school can have a positive impact on financial behaviors years later.
The survey sampled 1,000 young adults and found that 59 percent of those who received financial education in school are more likely to have good saving habits, compared to 41 percent of those who did not receive any education.
Unfortunately, that education is tough to come by in school curriculums currently.
T. Rowe notes that even when financial education classes are offered, they don’t discuss saving for retirement: Only 30 percent of young adults who took a financial education class learned about retirement saving in their class.
However, young adults who had some financial instruction are nonetheless more likely to prioritize retirement.
Young adults overall agreed with the statement, “I would like to save for retirement but I don’t have the money to do so,” but those who received financial education are more likely to agree with the statement, “Saving for retirement is an important priority, so I’ll find a way to save.”
Other highlights (or lowlights, depending on one’s perspective), include:
- Retirement saving is rarely discussed at home: Among the young adults whose parents discussed money with them, only 36 percent discussed saving for retirement.
- Most full-time employed young adults don’t have a 401k: Only 31 percent of young adults who are employed full-time have a 401k with their current employer.
- Young adults with financial education are prioritizing their savings: 48% have a retirement account, compared to just 30% of those without financial education.