How parents can turn cynicism into teachable moments.
Pamela Yellen, Huffington Post 07/27/2012 7:04 pm
It's no surprise. Many adults are wary of banks and credit card companies in the wake of the economic crash and many fear another cataclysm is around the bend. Now a new study shows banks and other financial institutions are losing the popularity contest with teens.
Many youth now view the financial sector as a bully laying in wait to snatch their lunch money through predatory lending tactics and high interest charges. That's the view one gets from reading a national opinion poll of high school students recently commissioned by the University of Arizona's Take Charge America Institute for Consumer Financial Education and Research and conducted by The Financial Literacy Group.
"A healthy skepticism about financial institutions has soured into cynicism, where teenagers almost expect to be victimized by financial firms," economists Michael E. Staten and Dan Iannicola Jr. say in an article titled Warm and Fuzzy Financial Ed Doesn't Cut It Anymore.
The poll of 878 students at 18 high schools in 11 states "shows that the majority strongly distrusted financial institutions even while expressing great confidence in other things like their likelihood to find employment and to achieve financial security."
"For example, 60 percent of students polled firmly believe that credit card companies often entice people into taking on more debt that they can handle, while 70 percent believe that businesses try to 'trick' young people into spending more than they should," the article states. "Only 25 percent of students disagreed with the statement, 'the stock market is rigged mostly to benefit greedy Wall Street bankers,' and only 17 percent disagreed with the statement, 'banks are mostly interested in getting my money through hidden fees.'"
The study also found teens lacking in some basic knowledge when it comes to personal finance. For instance, 68 percent did not know that owning stocks is a riskier form of investment than owning government bonds, and more than half didn't know that a high credit score is better than a low score. MORE