Let’s face it: Learning about personal finance is not fun but it is necessary.
Students won’t trade playing video games or going out with friends for staying at home and reading about how they can budget better. They think they have better things to do, but the teenage years are a crucial formative period in life for picking up correct financial habits that can be carried on until they reach adulthood.
My first thought when I read about R.A. 10679 being rolled out for senior high school students was: “These kids are very lucky. We never had that when I was in school.” That is the Youth Entrepreneurship Act, which is the policy that mandates the Department of Education (DepEd), the Commission on Higher Education (CHED), and the Technical Education and Skills Development Authority (TESDA) to promote entrepreneurship and financial literacy among students in the country.
A related learning experience was what Aya Laraya told us about during the first session of the #Money4LifeChallenge of Sun Life Financial: “Some people taunt variable unit life insurance (VUL) for its inefficiencies, but we cannot deny the fact that it builds discipline to save money and invest. It makes saving and investing mandatory instead of relying on personal initiative when starting your journey to financial freedom. If you tell your 6 or 7-year old child that it’s optional to go to school, do you think he will go there on his own?”
These teenagers are exposed to all means of spending because of easy access to the internet and the frequency of new models of retail goods being released on the market. These result in 1) increasing demand for numerous features in the new gadgets, which of course jack up the device’s price, as well as 2) pressure on people to try to keep up with the lifestyle of those around them and those they see online.
Another reason why some students are not mindful of their spending is that they do not experience the work involved in earning the money for it. This financial privilege granted to them until they graduate from college hinders them from actively seeking ways to be frugal and manage their finances well.
Some high school graduates even have the mentality that sets them up to use their increased college allowance for buying everything they could not afford with their high school allowance. This should not happen, given that college life is a preparation for financial independence once they enter the workforce.
I had poor financial thoughts when I was in senior high school. I never sought out ways to manage my finances better and, instead, wondered why my parents never bought me a branded backpack while I was still going to school. Understanding that my father was being financially wise in preparing for our future seems like a simple thought now, but I did not have the financial education and maturity to realize this at a young age.
Ideally, this program will make teenagers aware of what methods they can do to know the principles of saving, avoiding debt, and knowing basic information about various financial products. Building a healthy financial habit from this knowledge would be the ultimate goal so they can start working toward achieving such target, which is easier said than done.
The chances of being scammed may also be reduced if the foundation of financial education is properly set, teaching the young people that legitimate investment offers realistic returns over time. In 2015, losses from scams reportedly ranged from P900 million to P30 billion. This can be significantly slashed if everyone does due diligence on anything in which they put their money.
Instead of finding fault on how this will not work, let us find ways of how we can personally support this effort toward gaining financial education by taking the initiative to share our personal finance lessons at home with our younger family members, or with friends. The students who are willing to undergo this program will form part of the country’s future workforce and disruptors, so we must help in its implementation by the DepEd. In the long term, this will yield economic benefits for us so we must support this initiative and continue applying the bayanihan spirit in financial education to get there.
Kristel Silang is the Content Manager of MoneyMax.ph, a financial comparison website aiming to help Filipinos save money through diligent comparisons of financial products.