WASHINGTON, June 8 /U.S. Newswire/ — Operation HOPE today released survey data demonstrating that African American high school students have lower levels of financial literacy compared to their white counterparts. Eighty percent of African-American high school students failed a multiple choice examination which measures the ability to make informed financial choices, compared to 54.6 percent of white students. The survey was commissioned by Operation HOPE with data by the Jump$tart Coalition. This HOPE sponsored survey is the second annual representation of tracking only African-American young adults as a stand alone group.
The report, available online at http://www.operationhope.org/smdev/lf1.php?id=717 also states that financial literacy for African American students is related to income and that African American students are better spenders then savers. Statistics showed that:
— African American students from the lowest income families had a financial literacy score of 40.7 percent and African American students from the highest income families had a score of 50.5 percent.
— African American students scored 37.7 percent on Money Management, 36.6 percent on Savings but 50 percent on Spending.
"The key is not necessarily making more money, but making better decisions with the money you make, and we are not yet demonstrating as a group of people that we understand this important distinction," said John Hope Bryant, founder, chairman and CEO of Operation HOPE. Bryant continued, "In a 21st century increasingly defined by an economic agenda here and around the world, we must begin to get our relationship right with money and the free enterprise system. Poverty is our new enemy, and we must build upon successes with civil rights to include what I call a new ‘silver rights’ passion, agenda and focus."
As part of his Silver Rights Campaign for financial literacy and education, Bryant provides the following five tips for students, high school or college, to better manage their money:
1. Stay in School. Education is the ultimate poverty eradication tool next to love of family, to enrich one’s self- image, self-confidence, and self-esteem. Research has shown that college graduates earn almost twice as much as high school graduates. Your college degree is now the new high school degree in the 21st century. Not having a college degree is an economic death sentence and too many kids are dropping out of high school.
2. Get a Job. Explore summer jobs and internships in the field of your interest. Gain experience in the "real world."
3. Budget. Get your priorities straight. Don’t focus on your wants, focus on your needs.
4. Save. Practice the 10 percent rule. If you make $1,000, pretend that it is $900 and save $100 in a savings or investment account. You can become a millionaire from 17 to age 65 simply by investing $100 per month in a moderately indexed investment account.
5. Save to Buy a Home. Save to buy a house in a low-wealth neighborhood before you rent an apartment you don’t own in an upscale one. A home provides security and gains value over time.
"While overall results are still not good, it is hopeful to see that young African-Americans from higher income families are nearly as financially literate as others in society with their financial means," said Dr. Lewis Mandell of the State University of New York at Buffalo, who prepared the Jump$tart Survey for Operation HOPE. "As more families stress the importance of this skill and prevail upon schools to offer quality education in financial literacy, this equality is likely to spread to students in every income category," he said.
While all young Americans are in need of and deserve to learn financial survivorship skills, this is particularly important for African-Americans who currently lag in both the financial resources and financial literacy needed to enjoy a secure stake in our "ownership" society.
Operation HOPE, through its series of "silver rights" movement campaigns, seeks to integrate the dollar as civil rights leaders integrated the lunch counter, by bringing resources, technology, and opportunity to low-income communities through partnerships between government, community, and the private sector, believing that education is the ultimate poverty eradication tool. "Over 182,000 young people in more than 700 schools in 22 U.S. cities coast to coast have been empowered to take control of their financial future through Operation HOPE’s Silver Rights Banking on Our Future program with the participation of over 3,000 professional HOPE Corps volunteers," said Mary L. Hagerty, senior vice president, chief of Financial Literacy Initiatives, Operation HOPE.
For more information on Operation HOPE, Banking on Our Future, the "silver rights" movement campaigns, and this downloadable Operation HOPE commissioned report on African-American youth financial literacy log onto http://www.operationhope.org.
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About Jump$tart Coalition for Personal Financial Literacy.
The 2006 Jump$tart Survey, the Financial Literacy of Young African-Americans Adults, was prepared by Dr. Lewis Mandell, Jump$tart Coalition for Personal Financial Literacy and State University of New York at Buffalo, and is based upon a Survey sponsored by Merrill-Lynch. Jump$tart began measuring the financial literacy of young adults in their last year of high school in 1997. The widely reported results tell a dismal story. Few high school seniors are capable of passing a multiple choice examination which measures their ability to make informed financial choices in matters that are critical to persons of their age. To compound this problem, scores have declined significantly since the test was first administered in 1997. At the request of Operation HOPE, a separate analysis is conducted to measure the financial literacy of African-Americans who were included in the overall Jump$tart survey.
Operation HOPE, Inc. is America’s first nonprofit social investment bank and a national provider of financial literacy and economic empowerment programs. It works to bring self-sufficiency and a sustained spirit of revitalization to America’s inner-city communities. The three key programs, which serve as the foundation for delivering HOPE’s financial literacy programs are HOPE Coalition America, Banking on Our Future, and neighborhood HOPE Centers. To date, HOPE has created more than 800 new homeowners and 250 small business owners, more than $125 million in funded loans, and more than $240 million in commitments for homeownership and small business loans from their 250 bank and corporate partners. Operation HOPE has helped thousands of Katrina victims with emergency financial counseling as well as helped thousands more through a partnership with former President Clinton and the Clinton Foundation to claim EITC benefits Katrina victims rightly deserve from the federal government. At the core of HOPE’s mission to eradicate poverty and empower the wealthless is a movement to establish "silver rights" or the right to financial literacy, access to capital, and equality of opportunity for the underserved. HOPE and its programs can be found online at http://www.operationhope.org.