With the baby boom generation approaching retirement age, the potential dependence of additional millions of senior citizens on social security and other parts of the government's social safety net may pose a very expensive fiscal dilemma for the federal government. Clearly, too many Americans are unprepared to maintain their standard of living in retirement. Sadly, too few people understand compound interest, investment strategies, risk assessment, insurance and other basics of money management. Most people don't realize the benefits and the costs of credit or the role that home ownership plays in helping to accumulate wealth. The roots of the problem are not hard to find.
Most people acquire their financial knowledge haphazardly, by trial and error.
Numerous surveys reveal that most people growing up do not learn any principles of personal finance systematically from their parents. Instead, they pick up bits and pieces in school, from the media, and through their business dealings with financial service providers. Often, the information they acquire is misleading or fraught with errors. One way to begin to eradicate haphazard learning is through the introduction of financial literacy concepts early in the education of every child. In this context, the Federal Reserve Bank of New York is committed to continuing its program of working to promote financial literacy through the schools.