Personal Finance Curriculum

A personal finance curriculum helps prepare students for the real world by addressing budgeting, saving, investing, credit, setting goals, and planning for a career. Other important skills include spending, banking, how to write a check, and how to balance a checkbook. A personal finance curriculum will help students to be responsible members of society. Setting educational goals to pursue a career choice is one of the topics covered. A curriculum will cover how economic conditions affect money management. Another important part of financial studies include how to understand the terms and conditions associated with credit cards and other types of loans.

Planning a career is very important for students of all ages. The younger students will be more interested in beginning a career whereas middle age and older students may want to make a career change or advance in a present vocation. A personal finance curriculum will provide a student with choices by supplying information about various occupations and examples of job descriptions and salary averages. Making a career choice will lead to other decisions that need to be made such as, what college to attend and what degree to choose. A person may even study about personality and motivation and take a test to see what occupations would suit his or her personality.

When considering a career choice a person will need to consider some other things. Personal financial choices take into consideration how much a person will earn and how much will go to paying obligations. Some of those obligations will include transportation, food, taxes, investments, savings, utilities, phone, house payment or rent, insurance, and entertainment. A personal finance curriculum will teach a person the importance of making choices that are affordable and reasonable. In other words, someone who is making an average income should not go buy an expensive car or fancy home that is not really affordable. When a person's earned income all goes to one thing then everything else will be neglected. This is where learning to live on a budget becomes important. "Be not thou one of them that strike hands, or of them that are sureties for debts" (Proverbs 22:26).

Learning to live on a budget will mean trying to plan a certain percentage for living expenses. A home will take up a big chunk of what a person makes usually about 25% of gross income. A budget should have a column for category, percentage, monthly amount, annual amount, and ending balance. There should be categories that include any area where money is going out or being spent. Total income should be at the top and then expenses need to be deducted from income. A personal finance curriculum will provide different examples on how to keep a budget. One of the most important things when trying to keep a budget is to write down all expenditures no matter how small. Overspending will mean a deduction from another area. In other words, spending too much money or going over the budget on buying groceries will mean less money for recreation or entertainment. A great way to create a budget is by using spreadsheet software. A budget should include categories for saving and investing because these are important considerations towards successful money management.

Establishing credit and maintaining credit worthiness is a big part of a personal finance curriculum. A very big temptation for students is credit cards because many lenders target them with advertisements. Any credit card payments would need to be taken into consideration in the budget. The payments will include interest and sometimes annual fees and other types of fees. A student will learn the importance of how much credit is too much and how important it is to pay bills on time because of the consequences that happen when one becomes overextended. There is a great deal of responsibility that comes with establishing credit. If that responsibility is not taken seriously then a person can easily find themselves paying high interest rates and other types of fees due to low credit scores.

Financial setbacks do happen no matter how careful a person follows a budget. Setbacks can be caused by illness, job loss, emergency situations, and so on. A personal finance curriculum helps to ready students for the possibility that they may have financial setbacks from time to time. This is one really good reason why a person should budget in a savings or an emergency fund. Having a credit card with a high limit can help during a setback but the drawbacks in using one are numerous. Maxing out credit cards lowers one's credit score. If a credit card gets maxed out then there will be a lot of interest due on that amount unless the cardholder can pay the entire balance off before the next billing cycle. Once a credit card becomes maxed out it seems almost impossible to pay it off especially if the cardholder only makes the minimum monthly payment amount.

Having limited personal finances can affect how a person makes financial decisions. A personal finance curriculum teaches the importance of setting goals and decision making especially when there is a crisis or limited money coming in. A budget can help a person to take control of his or her finances when things seem so out of control. In learning about goals and decision making students will learn how to evaluate the consequences of making the wrong decisions which will help them to make better decisions. They will also learn that going through a financial crisis can help them to avoid the same type of situations in the future as they learn to evaluate why it happened and what can be done to or what can be changed to make sure they obtain financial success.

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