How Financial Literacy Empowers the Next Generation to Shape the World
Money isn’t just a means to buy things; it’s also a way to discuss who gets to shape the future. If young people don’t learn about this concept of money, someone else will decide what happens to them in the future. In today’s fast-paced world, knowing how to handle money is not an option; it’s a skill you need to have to stay alive. Teens leave school solving quadratic equations, but are unable to open a savings account or avoid predatory loans. It isn’t just a minor annoyance; it affects our decisions about college, work, housing, and even our health without us even knowing it. Finance isn’t just about money. It’s about knowing what it means to have power, be responsible, and have opportunities. If my generation learns how to manage money, we won’t only become wealthy, but we’ll also make the world a better place to live.
I didn’t see this need in a classroom; I saw it in my daily life. A friend of mine signed up for a “zero-interest” buy-now-pay-later phone plan, unaware that the interest rate would increase significantly if a payment was missed. One late bill resulted in extra charges, and the supposedly “cheap” phone turned out to be substantially more expensive than expected. I thought about why we learn trigonometry but not the math we use every day. To find out more about this, I started the student investment club Market Master. When only two hands went up, I felt a jolt; my friends weren’t bored, they were shocked. That moment convinced me we needed this club. It was clear that my friends wanted to learn about money but had never had the chance to do so.
To help people learn about money, we held a month-long fake investing contest. One team invested all its money in a single cryptocurrency after watching a viral video about it. Another group made a portfolio that included an index fund and big, stable companies. The crypto-heavy team had lost 40% of its value by the end of the month, while the team with a mix of assets had gained about 8%. That lesson was better than any class. Then, we acted as if the market had dropped significantly. I watched panic spread across the room; some sold in fear, while a few steadied themselves and even bought more at the dip. It wasn’t a formula that was most important to remember; it was a way of thinking: fear is stronger than reason, and the only way to stay calm is to have a plan ahead of time.
Learning about money starts with easy words and habits. Budgeting isn’t a punishment; it’s a way to help you. Saving doesn’t mean you can’t have fun; it means you can reach bigger goals later. Investing isn’t gambling if you spread your money around and think about the long term. Compounding, or earning money on both the original investment and the returns from previous investments, means that small actions can have a significant impact. To find out how long it takes for money to double, divide 72 by the annual return rate. This is how quickly the Rule of 72 works. If you put money away for eight years, it will double in about nine years. That’s not just math for a teen; it’s a timeline. If you start early, time will work in your favor instead of against you.
Money, however, is never yours alone. It determines who gets to speak and what gets constructed. Financially literate individuals can contribute to causes they care about while also expanding their personal financial accounts. This is demonstrated by the growth of ESG (Environmental, Social, and Governance) investing. When I read PwC’s projection that the entire value of ESG assets managed globally is expected to surpass $33 trillion by 2026 (PwC, 2023), I wondered what if my generation made clean energy our default investment, not a niche? There is more to these figures than meets the eye. They indicate that millions of people are opting to invest in businesses that act responsibly, treat their employees with respect, and care about the environment. If young people can manage their finances, this change can occur more quickly. Consider how many Gen Z investors would prefer to invest in clean energy startups rather than purchase stock in environmentally harmful companies. The stock market reveals not only what companies are doing, but also what people are looking for. Teens will vote every dollar they spend, not just once every four years, if they understand this.
The digital age comes with both advantages and disadvantages. People my age can open a brokerage account with just a few taps on a smartphone, buy fractional shares, and learn by watching online videos. It is truly a great time to practice and gain experience. At the same time, however, it also exposes us to risks. TikTok is filled with pump-and-dump schemes, cryptocurrency projects that collapse overnight with little to no regulation, and AI-based scams that promise unrealistic returns. According to the Federal Trade Commission (FTC), investment scams resulted in losses exceeding $4.6 billion in 2023, with young adults among the groups that suffered the most significant financial losses (FTC, 2023). This is why knowing how to handle money should include making a budget. It also needs to teach how to handle risks, think critically, and control your emotions. We required everyone to write a brief “investment thesis” for every trade they made in Market Master. This made people stop, check their facts, and think before they clicked. By the end of the semester, every trader, regardless of how reckless they had been, had become a savvy and careful investor.
People who are unaware of how to manage their finances are not only an issue for wealthy nations. The World Bank (2023) states that globally, 1.4 billion adults do not have a bank account. You can’t start a business or get through a crisis without a safe place to save or a fair way to borrow money. Kenya’s M-Pesa and other mobile banking services have demonstrated that a phone can be a powerful tool for managing your finances. It helps small businesses get paid, parents pay for school, and families save money safely. Teenagers all over the world can change their lives if they learn about credit, interest, and opportunity cost. A student who is familiar with microfinance can help her family earn money by obtaining a small loan. A young person who understands how compound interest works can avoid payday loans that grow exponentially. Understanding money is a multiplier; it helps not just one person, but entire communities.
It’s not just people who are responsible. Schools should teach kids about money as seriously as they teach them about history and science. A good curriculum could include four main topics: how to manage finances and budget, how to save and earn interest, how to invest and diversify your money, and how to protect yourself from credit fraud. A real curriculum could include budgeting, compound interest, diversification, and identifying scams; skills teens can apply right away. Schools and communities can also have guardrail investing contests. In these challenges, students earn points for managing their risk and being transparent about their reasoning, but the returns are only part of the grade. Families can help kids develop good habits early by establishing simple systems, such as three-bucket budgets for spending, saving, and giving.
I can still picture how my club members looked after our first challenge. The team that lost was initially embarrassed, but then things changed. They began to ask more detailed questions, such as, “What is this asset? How does it make money? What causes the price to change?” In just a few weeks, they rebuilt the portfolios by mixing investments and clearing stop-loss rules. At that moment, I realized that being financially literate isn’t about making everyone rich, but it’s about giving everyone a fair chance to make good decisions.
Financial literacy isn’t just about getting by in the system; it’s about making it better. When kids learn about money, we can advocate for better rules, support businesses that do the right thing, and create tools that benefit more people. We can help make a future where your last name, zip code, or luck don’t determine what opportunities you have. This essay is more than just an argument; it’s a call to action. My generation needs to think of financial literacy as a right, not a luxury. Schools should teach it a lot and early on. Communities need to create safe places where people can gather. And we all need to pass on what we learn to someone else, like a younger student, a sibling, or a neighbor, to keep the cycle of knowledge going.
Teens who learn how to do it not only earn money, but they also influence the future that we will inherit. In my ideal world, young people everywhere would be able to choose impact over inequality, careers over fear, and education over debt. I envision a generation that views wealth as a means of addressing issues we have inherited, such as poverty, injustice, and climate change, rather than as a symbol of status. By making decisions now, in communities, classrooms, and even small groups like mine, we can help prevent unintentionally creating that future. I decide to continue learning, building, and instructing others. My generation will leave behind a just, sustainable, and opportunity-rich world if we follow suit. Future generations will appreciate this world.
By: Geonhwi Cho
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