Includes 15 Recommendations for Improving Financial Literacy for All Americans WASHINGTON, D.C. – The bipartisan U.S. President’s Advisory Council on Financial Literacy today announced the publication of its first Annual Report to the President, which contains 15 recommendations for steps that should be taken to improve the financial literacy of Americans of all ages. The 16-member Council unanimously approved the report during its meeting on January 6, 2009, and the full Annual Report is now available here. Among the report’s recommendations are calls for mandating financial education in schools for students in grades K-12; exploring tax incentives to encourage employers to provide financial education in the workplace; increasing access to bank accounts for the tens of millions of unbanked and underserved Americans; conducting research on the state of financial literacy in America and on the most effective ways to improve financial knowledge among Americans; and creating a self-administered “National Financial Literacy Check-Up” that would allow Americans to assess their own financial knowledge and providing links to trustworthy sources of information to help fill in the gaps. “Financial literacy has never been more important than it is today,” said Council Chairman Charles R. Schwab. “There is no question that the lack of personal financial literacy has been a major contributing factor to the economic and financial crisis in the United States. We believe that this report contains recommendations that will help Americans at all stages of life learn the financial basics so that they can manage their own money wisely, save for the future and navigate our complex economy effectively.” “The best response to this crisis is to put in place policies and practices that help to insure that something like this never happens again,” said Council Vice Chairman John Hope Bryant. “Financial literacy empowerment of the individual is key to our future and the Council’s Annual Report to the President speaks to this.” The Council, which is scheduled to remain in place through January 2010, plans to work with Members of Congress, the executive branch, the private sector and faith-based and non-profit organizations in the coming year to implement the recommendations.About the President’s Advisory Council on Financial Literacy The President’s Advisory Council on Financial Literacy was created by President George W. Bush in January 2008 to advise the President and the Secretary of the Treasury on ways to improve financial literacy among all Americans. The 16-member Council includes representatives of non-profits, private sector companies, academia, state government and other organizations dedicated to the delivery of financial education. More information on the Council can be found at: http://www.treas.gov/PresfinlitCouncil.
The recommendations found in the President’s Advisory Council on Financial Literacy annual report, issued at the close of December, 2008, have been taken to heart by the media. On Tuesday, January 13, U.S. News & World Report reporter Kimberly Palmer wrote the following article, highlighting five of the Council’s recommendations:
5 Ways Obama Can Improve Financial Literacy How the next president should handle the growing financial literacy crisis By Kimberly Palmer The central concept behind new policy recommendations to boost Americans’ financial literacy seems to be this: We’re not stupid; we just haven’t been taught properly. With just days left in the Bush administration, the nonpartisan President’s Advisory Council on Financial Literacy, chaired by Charles Schwab, has made its recommendations for boosting our financial IQ. President Bush created the council a year ago in response to the fact that many Americans struggle with such basic concepts as calculating interest rates and developing a budget. Because the council serves through 2010, members plan to work with the Obama administration to promote financial literacy. The financial crisis has only escalated the enthusiasm for increased financial literacy, says Ted Beck, a member of the council and president of the National Endowment for Financial Education. “It’s one of the greatest teachable moments that’s ever happened,” he says. The recommendations are not without controversy: Some financial experts say that rather than emphasizing financial education in schools, the government should focus on simplifying the financial world so that it’s not so difficult to navigate. Here are five of the council’s recommendations for improving financial literacy:strong>Schools should be required to teach financial education from kindergarten through 12th grade.While research on the impact of financial education has been mixed, the council says schools should adopt money-related curricula. Research by the Charles Schwab brokerage firm has found that many parents don’t talk to their kids about money, and only 1 in 3 had taught their teens how to balance a checkbook, for example. “Standards-based financial education in the classroom helps to level the playing field for students whose parents may have faced financial challenges themselves or who may be among the unbanked or under-banked populations,” the council says. Currently, only a handful of states require students to take personal finance courses. In middle school and high school, students should learn the basic concept behind a budget, developing a savings plan, and wants versus needs, says Beck. But he adds that personal finance classes need not replace other coursework. Instead, Beck says, money lessons can be built into existing classes, such as the social sciences and math. College students should be required to take a course in financial literacy in order to receive federal student loans. Because college students often build up credit-card debt and take out other types of loans, schools should use the opportunity to teach them about money, the council says. Beck says that students at this level should learn how to buy a home, develop a savings plan, and manage loans. Employers should receive tax incentives to teach workers about money. “Financial education is a continuous process,” says Beck. “The playing field changes, so you need a continual flow of information that’s relevant at that time.” That’s why workplace programs that can teach employees about saving for retirement, for example, can make a significant difference. The council says that such programs could boost productivity by reducing stress. “When employees are worried about debt and other personal finance issues, they have more difficulty focusing on their jobs,” says the council, adding that one group estimates that employee financial stress costs businesses about $300 billion a year. The government should create a resource center on its financial literacy website, www.mymoney.gov, for human resources professionals and employers. With all of the information circulating on the Internet and available in the personal finance sections of bookstores, one might think that people have more than enough resources at their fingertips. But the council says that the government is uniquely position to provide employers with a “one-stop” shop for financial education resources. Other websites can be so numerous that they’re “intimidating,” the council says, and some may be sponsored by fraudsters.Financial institutions should be required to provide every adult American with access to a debit-card-accessible bank account. The council wants the 28 million Americans without bank accounts to get one, largely to protect them from high-interest payday lenders and other risks. “Many people have a history where they’re not sure they’d be welcomed by banks,” says Beck, so this recommendation is about making sure all consumers have access to a regulated, insured bank account.
Continued awareness and understanding will help shape a financially literate America. The more individuals these messages can reach, the better. To read the original article, please visit 5 Ways Obama Can Improve Financial Literacy.
On Tuesday, September 2, Sharon participated in a Financial Services Roundtable during the Republican National Convention as a representative of the President’s Advisory Council on Financial Literacy. This is one of several events Sharon is participating in on behalf of the advisory council while in Minneapolis. In the picture to the left, Sharon speaks with Kathy Wills Wright, Special Assistant to the President, Charles Schwab, and vice president of Legislative and Regulatory Affairs, Michael Townsend. The roundtable featured a presentation by fellow advisory councilman John Hope Bryant. The roundtable brought together some of the brightest minds in both the financial and government sectors dealing with the nation’s economy. The economy has been an increasing spotlight in the 2008 elections amidst a national credit crisis, a struggling mortgage industry and an overall economic slow-down. The work Sharon and others do on the council will help shape the information our next President will receive and act upon to ensure a future bolstered and expanding U.S. economy.
WASHINGTON, DC–(MARKET WIRE)–May 28, 2008 — At the inaugural meeting of the U.S. President’s Advisory Council on Financial Literacy, Committee on the Under-Served, now chaired by HOPE founder John Hope Bryant, a decision was made to call on experts and advisors to gather useful information which will ultimately lead to hoped for “best practices” around the future of responsible subprime lending. Furthermore, the Committee will explore how financial literacy could have helped to avoid the current subprime mortgage crisis in the first place. “With all the attention presently focused on solving the subprime mortgage crisis, there is a very real possibility, I believe, that lending to the poor, the under-served and even the middle class might effectively dry up. This would not be good for America,” said Committee Chairman John Hope Bryant. He went on to say, “Responsible subprime mortgage lending has done more to lift the poor out of poverty than anything else over the past 50 years. The problem has been irresponsible, predatory and greed-based subprime lending, and massive levels of financial illiteracy amongst many borrowers that fuels it, and not subprime lending itself.” Committee member Sharon Lechter, CEO and founder of Pay Your Family First, LLC and best-selling author added, “The ‘need’ for providing affordable housing, rational financing, and the opportunity for home ownership has never been greater. We have the opportunity to work together to develop responsible subprime lending programs that will serve the population who needs them the most, while also providing essential financial education to them through the process.”The Committee will gather information (1) to better understand efforts needed to identify and to differentiate responsible and irresponsible subprime mortgage lending, and furthermore to outline what a responsible subprime loan product might look like in the future, (2) other related issues such as proper and “common sense” clear loan disclosures and the overall context in which these products, disclosures and other related mortgage factors become active positive or negative contact points with respect to financial literacy. Finally, (3) one key objective of the effort should be to identify what financial literacy initiatives are needed to address the massive levels of financial illiteracy that contributed to the current subprime crisis. “Our goal in this country should be to raise up generations of children who have an equal chances to live healthy, happy, and productive lives. Without sound policies supporting financial literacy, this goal will be unobtainable. This is not about getting rich. It’s about the survival of both our working poor and our economy,” remarked Committee member Rev. Dr. Robert Vernon Lee, III. Committee member Ignacio Salazar said, “This committee will make every effort to provide greatly needed financial literacy information to underserved communities. By empowering our communities with sound financial habits, we can take the first step in restoring confidence in the relationship with lending institutions.” Already the FDIC, the U.S. Comptroller of the Currency, the U.S. Office of Thrift Supervision, the Securities Exchange Commission, HUD and the FHA, the National Credit Union Administration, the Banking Commissioner for the District of Columbia and the Superintendent of Banking for the State of New York, along with a core of some of America’s leading financial institutions amongst others, have made commitments to serve as expert advisors to the Committee. Members of the newly created President’s Advisory Council on Financial Literacy, Committee on the Under-Served include Ignacio Salazar, member of the U.S. President’s Advisory Council on Financial Literacy and president, SER National-Jobs For Progress, Inc.; Sharon Lechter, member of the U.S. President’s Advisory Council on Financial Literacy and founder and CEO, Pay Your Family First, LLC — she is also the co-author of international best-selling “Rich Dad, Poor Dad” book series; Reverend Robert Lee, member of the U.S. President’s Advisory Council on Financial Literacy and founder and CEO, Fresh Ministries, Inc.; and John Hope Bryant, Committee chairman, and vice chairman of the U.S. President’s Advisory Council on Financial Literacy. Mr. Bryant is chairman, founder and CEO of Operation HOPE. Financial guru Charles Schwab, CEO of Charles Schwab Corporation is chairman of the U.S. President’s Advisory Council on Financial Literacy, and U.S. Treasurer Anna Cabral and Carrie Schwab Pomerantz, president of the Charles Schwab Foundation, are advisors to the Committee. About the President’s Advisory Council on Financial Literacy The President’s Advisory Council on Financial Literacy (the Council) was created on January 22, 2008 by President George W. Bush. The Council’s purpose is to help keep America competitive and assist the American people in understanding and addressing financial matters. Each member of the Council represents an industry involved with the delivery of financial education to American citizens. The President and the Secretary of the Treasury have tasked the Council to work with the public and private sector to help increase financial education efforts for youth in school and for adults in the workplace, increase access to financial services, establish measures of national financial literacy, conduct research on financial knowledge and to help strengthen public and private sector financial education programs.
Sharon Lechter joins in first ever council to educate the nation during unpredictable economy PHOENIX (January 22, 2008) – Paradise Valley, Arizona, resident Sharon L. Lechter was appointed to the President’s Council on Financial Literacy in a ceremony held in the Roosevelt room at the White House in Washington, D.C., on Tuesday, Jan. 22, 2008. Lechter and the council, comprised of 19 members from the business, faith and non-profit communities will help shape the course for a financially literate nation. The council is charged to gather information about financial literacy and its condition in the U.S., recommend improvements to national policies to the President and the Treasury secretary and “assist the American people in understanding and addressing financial matters.” “I am thrilled to be a part of such a prestigious council,” said Lechter after her appointment Tuesday afternoon. “Together, this council can make an impact on the financial education of our country during these troubling economic times.” President Bush announced the advisory council Tuesday morning. A ceremony inducting the 19 members of the council was held later in the day from the Roosevelt room at the White House where the President made remarks. “We want people to own assets; we want people to be able to manage their assets,” said President Bush in his remarks. “We want people to understand basic financial concepts, and how credit cards work and how credit scores affect you, how you can benefit from a savings account or a bank account. That’s what we want. And this group of citizens has taken the lead, and I really thank them.” Members of the council include; Charles R. Schwab, of California , and upon appointment, Designate Chair; John Bryant, of California , and upon appointment, Designate Vice Chair; Theodore Beck, of Colorado; Theodore R. Daniels, of Maryland; Cutler Dawson , of Virginia; Robert F. Duvall, of New York; Tahira Hira, of Iowa; Jack E. Kosakowski, of Colorado; Sharon L. Lechter, of Arizona; Robert V. Lee III, of Florida; Laura Levine, of the District of Columbia; David Mancl, of Wisconsin; Don J. McGrath, of California; Janet Parker, of Alabama; Ignacio Salazar, of Michigan; Mary L. Schapiro, of the District of Columbia