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MintFamily with Beth Kobliner: President Obama’s Contributions to Financial Literacy

President Obama's Contributions to Financial Literacy

I recently wrapped up my service as the only financial journalist asked by President Obama in 2010 to serve on the President’s Advisory Council on Financial Capability.

In our meeting with the President at the White House a few weeks ago, the Council delivered our final report. One of the priorities of our two-year stint was to come up with recommendations on ways to teach young people financial basics.

This mission has been ably championed by Chair of the Council, John Rogers, and Vice Chair, Amy Rosen, two individuals who are smart, savvy, and totally convinced that it’s necessary to help our nation’s youth become financially capable citizens.

Included in the presentation to the President was a discussion of MoneyAsYouGrow.org, a website that I have devoted much of my time to over the past two years.

The site culls the best advice and information from literally dozens of curriculums, standards, lessons, and studies, and boils the findings down for families with an online, interactive tool consisting of just 20 essential, age-appropriate lessons about money for young people ages 3 to 23.

Though there is no marketing budget for this effort, as of today more than 630,000 people have visited the website since it was launched last May.

The site continues to get all kinds of terrific traction. Recently, The New York Times included tips from Money as You Grow along with related classroom activities for schools, and the Defense Department recommended MoneyAsYouGrow.org as an excellent resource for military families.

Attention like this has resulted in roughly 40,000 to 50,000 new visitors monthly—and by year’s end, that number will easily reach more than one million.

Numbers speak volumes, and I’m so happy that the President not only heard about MoneyAsYouGrow.org’s success, but also really “got” it: The American people are hungry for this information.

Parents are eager to embrace an unbiased, easy-to-understand tool that teaches their kids the lessons they wished they learned when they were young.

One of my favorite attributes of President Obama is his willingness to share his personal stories about personal finance in a way that no previous President has before.

He has talked about his credit card debt from early in his life, and has spoken about the weight of his student loans. He was not born into privilege, but instead worked his way up the economic ladder through hard work.

This President has championed these wallet-related issues for young Americans, showing himself to be the financial literacy President in the following ways:

The CARD Act

Signing the CARD Act, which requires anyone under age 21 who wants a credit card to either get a parent to cosign for it or demonstrate an ability to pay.

As a result, just 35% of college students last year owned a credit card, down from 42% in 2010, according to a 2012 study by Sallie Mae.

And a new Pew Research Center report found that a typical U.S. household led by someone under age 35 had $15,000 in total debt, including credit card debt, in 2010—down from $22,000 in 2007 and the lowest since 1995.

The Income-Based Repayment Program

Expanding and improving the Income-Based Repayment (IBR) program, which now allows federal student loans to be forgiven in 20 years rather than 25, and allows borrowers to cap payments at 10% of discretionary income rather than 15%.

Health Care Legislation

Securing passage of historic, affordable health care legislation, allowing 3.1 million young people under age 26 to obtain coverage under their parents’ plans.

College Scorecard

Creating the new College Scorecard, which allows families to compare costs, student loan default rates, and graduation rates at individual institutions when shopping for a college.

The Consumer Financial Protection Bureau

Establishing the Consumer Financial Protection Bureau (CFPB), which has made it a priority to help students and their families choose affordable colleges and manage the loan burdens they are carrying.

What Lies Ahead

The efforts to promote financial literacy by the President and his team are important in preparing the next generation for the financial challenges ahead–and there is work to be done.

In 2014, the Program for International Student Assessment (PISA) will release results of the first international exam administered to 15-year-olds around the world that tested financial literacy, and many experts expect the scores of U.S. high school students to be much lower than those of teenagers in other countries.

It’s time our nation gets financially fit. And there is no better President to get us moving.

April is Financial Literacy Month! What steps will you take to get financially fit?

© 2013 Beth Kobliner, All Rights Reserved

Beth Kobliner is a personal finance commentator and journalist, the author of the New York Times bestseller “Get a Financial Life: Personal Finance in Your Twenties and Thirties,” and a member of the President’s Advisory Council on Financial Capability. Visit her at bethkobliner.com, follow her on Twitter, and like her on Facebook.