Major or Minor in Money Because Ignorance Is Expensive
A generation of young people graduating with debt they can't repay because the jobs they studied for just don't exist has become a national crisis too severe to ignore. Few can afford to waste time and money. Today, seven in 10 graduating seniors at public and private colleges have student loans. Taking steps to make sure they have jobs before the loans come due is a process that should begin before enrolling for college.
The first step in making sure that students invest their time, money and intellect in the right course of study – one that has the hope of employment and personal satisfaction – begins with spending more deliberate time in selecting the right major.
Consider this recent report: "About 80 percent of students in the United States end up changing their major at least once, according to the National Center for Education Statistics. On average, college students change their major at least three times over the course of their college career." This kind of change often delays graduation and causes some to lag behind their peers who have had more time to engage in a career. It is also expensive for those paying the tuition, buying textbooks, and covering the cost of labs and additional fees.
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Career counseling and reflection on people's unique make up, passions and skills should not take place only a few months before getting a degree. Like any major accomplishment, a successful college education requires careful planning and strategy. Programs like Career Direct are designed to engage people in a study of themselves, their passions and their skills, to better focus educational investment.
But step two should be choosing a minor, or at least a deliberate course of study, that can save your financial life. In my experience as head of a non-profit that counsels people about career and finances, too many people are not a fit for their chosen career field leading to a frustrating life. But their next mistake can also lead to trouble.
Many people struggle with basic financial management. For those attending college right now, no matter what your major is make your minor, or at least a deliberate emphasis, an investment in a foundational understanding of economics and personal finance.
One of the reasons so many people struggle financially throughout their adult lives is because what they don't understand about money is holding them down.
The Council for Economic Education notes that while states are beginning to require some standards for economic education, only 22 out of 50 require an economics class before high school graduation. Economics is a field of study that looks at how money flows throughout a community, a nation, and the world. It's a big picture view of how our work fits together with other enterprises. It's vital information for anyone. In fact, economics affect every field of endeavor – art, medicine, music, politics, literature, the environment – it is not limited to those interested in business.
As students transition into adult responsibilities, they will need to run their own homes and lives, and the situation with personal finance instruction is even bleaker. Only 17 states require some kind of personal finance instruction to graduate from high school, with only six of those actually requiring students to pass a test.
Ironically, what they are not required to understand in school, they will be held accountable for in the real world, as banks, the IRS, credit card companies, utilities and even their employers will demand compliance with financial agreements they may never understand.
Of interest to those who study money and business is their attractiveness to employers. Georgetown University found that "the risk of unemployment among recent college graduates depends on their major" and that students graduating with a business major experienced lower unemployment rates.
It will come as no surprise to most parents that unemployment rates were higher for those who studied the arts, humanities and general liberal arts. It's a wonderful thing to have a passion for Monet or the works of Shakespeare. But it's equally important to think through how that passion becomes employment, when investing in education.
Financial ignorance isn't bliss; it's crushing student loan debt, delays in starting your life, frustration with an inability to fulfill your purpose or even bankruptcy. Such ignorance is a painful neglect of something that all will have to deal with, like it or not. Taking time to align your unique gifts and abilities in employment and to understand your finances will make all the difference in achieving a life well lived, unencumbered by needless waste of time and money.
