CFPB Director Richard Cordray said on Thursday that “fashioning bridges of experience” between people is the “mark of all great societies,” adding that the same approach is necessary in the area of financial education.
“If we intend to foster and maintain the kind of society in which all Americans are able to enjoy the blessings of liberty by controlling the direction of their lives, then we must make a point to arm our fellow citizens with the wherewithal to stand on their own two feet and make sustainable economic choices,” Cordray said during the Annual Financial Literacy and Economic Education Conference in Maryland. “Financial education should be as fundamental as the education we are all required to receive in U.S. history and government. Within the framework of our republic, we have built the greatest system of economic liberty in the history of mankind. Yet it will only endure if we take the steps necessary to strengthen that system from the bottom up, starting with the individual.”
Cordray said that parents must engage in discussions about money with their children beginning at an early age, because children form their “financial identities” at an early age. He also noted, however, that money is a taboo subject for many families, and that parents often lack the background and experience to have the necessary discussion.
“So we must start by filling this gap and being more deliberate about pursuing financial education in our schools,” Cordray said. “Everyone sees this when they focus on what goes on around them, yet it is now 2013 and still many states have no requirement at all to ensure that their young people receive such instruction. To put the matter simply, that has to change. It is unconscionable and indefensible that we seem so content to do a lousy job on these matters of such undeniable importance.”
Cordray stressed a focus on financial literacy, awareness of everyday choices that create lasting changes in one’s life and recognition that some financial decisions can affect the entire trajectory of one’s life.
“If you handle these major life decisions correctly, you will likely prosper; if you handle them poorly, you will multiply your troubles or perhaps run aground altogether,” Cordray said.
Cordray encouraged members of the Council for Economic Education to access a community of K-12 educators on LinkedIn, which was set up to share best practices and ideas on how to make financial education in schools a reality.
“Financial education over the vast expanse of this country is a daunting challenge, but it is one we know we can master, if we simply have the will to stick with it,” Cordray said. “It is inspiring to know that so many of us share this conviction, and we look forward to working with all of you.”