New Financial Capability Council Formed
WASHINGTON (CN) – Amid a $16.7 trillion national debt crises, President Obama has ordered executive agencies to create the President's Advisory Council on Financial Capability for Young Americans. It will be led by the U.S. Department of the Treasury.
The council will consist of the Secretary of the Treasury Jack Lew and the Secretary of Education Arne Duncan, in addition to 22 non-government members to be appointed by Obama.
Members of the council will be named in the coming months and the first public meeting is expected later this year, according to a statement by the Treasury Department.
The council aims to "collect information and views concerning financial capability" from a wide range of agencies and offices, including "financial capability innovators, educators and education policy experts, financial services providers, corporate leaders and employers of young workers, as well as other experts . . . to advise the president and the secretary on means to effectively implement the policy," Obama said in his order.
Part of the council's job will be to "identify and develop strategies to pilot financial capability approaches in schools and among young people that are likely to have significant effects on young Americans' financial capability, and determine ways to test and implement such innovations in a large-scale and sustainable manner," according to the order.
Part of the intent, Obama said, is to teach America's youth the difference between "wants and needs," by building public-private partnerships between members of the Financial Literacy and Education Commission and other agencies to "coordinate the use of high quality financial capability resources and practices in schools, families, communities and elsewhere to build the financial capability of young Americans," the order reads.
Obama signed an executive order in January 2010 that established the President's Advisory Council on Financial Capability, which targets adults, according to a Nov. 27 posting on FederalNews.com.
At a 2012 Financial Literacy and Education Commission (FLEC) Public meeting, Treasury Department Undersecretary for Domestic Finance Mary Miller said many older Americans are too cash poor to think about putting money into retirement, much less the country's youth.
"Today's youth are not thinking about their retirements, either. For example, one study from PNC Financial found that only 13 percent of 20 to 21 year olds, and less than 50 percent of 28 to 29 year olds reported that they contributed to a retirement savings account. There is an enormous opportunity here to reach these young Americans by starting early."
Also in late 2012, Federal Reserve Board Chairman Ben Bernanki, speaking to the Operation HOPE Global Financial Dignity Summit, said that, "At the Federal Reserve, we appreciate the benefits to families of acquiring basic information and skills about managing their money. But we see another important advantage of financial education, which is that an economy with financially knowledgeable households is likely to be stronger, more equal, and more stable. As such, we all gain from efforts to increase financial literacy."
There is a strong federal movement aimed at apparent financial education that is reaching far and wide, in some cases, to some unexpected agencies.
FLEC announced in April 2013 the inclusion of the Federal Emergency Management Agency (FEMA) in its operations, according to John Hope Bryant, the subcommittee chairman on the Underserved and Community Empowerment for the Advisory Council on Financial Capability.
"FEMA's involvement in the area of financial literacy, financial education, financial capability and financial empowerment is key during this era of super-storms that seem to be impacting our country at every level. After a natural disaster, individuals, families and communities often are faced with the daunting task of rebuilding their financial lives too."