by | Jul 17, 2020 | Behavioral Finance

“4 Money Lessons They Should Teach in High School”

Growing up in America we are taught many valuable things in high school, but an area that has historically been ignored is personal finance.  While Chemistry is almost always on the curriculum (I haven’t had to recall the periodic table since my 11th grade exams), everyday skills like budgeting typically are not.  Thankfully, programs like junior achievement and foundations in personal finance are starting to change that narrative and we can only hope the trend will continue.  In this week’s post, we put together what we think are four crucial lessons every student (and some adults) should know before they leave high school.  If you have a student in high school, or simply a family friend at that stage of life feel free to share these tips with them.


Lesson 1: Learn the Basics of Budgeting


Budgeting is crucial to achieving your financial goals.  COVID has made people painfully aware of this reality. While budgeting is very simply, it often gets overlooked.  Especially as high school students graduate and go on to start their career or attend college, there are monthly expenses they will need to learn to prepare for. These could include:


  • Rent/Mortgage
  • Utilities
  • Insurance
  • Car Payments
  • Groceries
  • Health Insurance


Lesson 2: How to Use a Credit Card


It’s so important that teenagers learn early on how a credit card works and, more importantly, how to avoid racking up high-interest debt.

College students and young adults are easily targeted by credit card companies with enticing offers for new lines of credit. Understanding how credit cards and interest work can save these young adults hundreds, and possibly thousands, of dollars.


When it comes to using a credit card, always remember:


  • You have to pay back what you charge
  • Credit card interest accrues daily when you carry a balance
  • Your interest rate can play a huge role in your monthly bill if you aren’t paying your charges completely off each month.


Lesson 3: How to Build Credit


Having a good credit score can make a big difference in how you manage your finances as an adult. If you’re looking to buy a house or rent an apartment, having good credit can make things much easier. If you have bad credit, these tasks can be much more difficult, so it’s important to learn about this early on.


Building good credit can involve positive financial habits including paying your bills on time, keeping credit card balances low (below 30% of your available limit) and limiting the amount of credit card accounts you open or use.  Maintaining good credit can make that first rental or property purchase enjoyable!  Working with a trained financial planner can help instill the good habits necessary to improve your credit score.


Lesson 4: Basics of the Stock Market


The stock market can be a confusing place for people of any age, let alone young adults just out of high school. Consider introducing your teenager to the basics of the stock market at an early age. It will give them the foundational knowledge needed to understand the importance of investing in achieving larger financial goals.  If you’re not confident in your ability to properly explain the stock market to your children, working with a financial planner can help get the message across. Even starting small now could yield large returns for your teenager later in life. Helping them understand long-term investments and how the market works now could be an impactful life lesson they’ll thank you for later.


We learn a lot of things in high school, but unfortunately so many of those things are not the practical items that will help us in our daily lives after we graduate.  Help your teenager, grandchild, or family friend hit the ground running with these helpful financial tips.