Like most Americans, Yanely Espinal didn’t receive money management or financial literacy education during her K-12 schooling in Brooklyn, New York. And, like many Americans, she went on to college, obtained a couple of credit cards, and accumulated a significant amount of debt.
After graduating from college, Espinal found herself in over $20,000 of high-interest credit card debt before she began reading Suze Orman’s “Women & Money: Owning the Power to Control your Destiny,” which provided her with a roadmap to financial freedom.
Espinal, now known as Miss Be Good, a popular financial educator on social media, saw how a lack of financial literacy at a young age impacted her life. She is now the director of educational outreach at Next Gen Personal Finance.
She struck the perfect balance between her first book, “Mind Your Money,” and the financial education she received in her native Dominican American culture in her debut book, “Mind Your Money,” in 2023.
Reckon spoke with Espinal about how she became Miss Be Good and why financial education is a pathway to freedom.
What role do you believe financial education classes play in alleviating the financial stress that many young adults face?
In the coming years, young people will experience anxiety related to money. Perhaps it’s because they want to start earning money and contributing financially, or because they want to alleviate financial burdens at home by helping out their parents, but they don’t really know how to.
The most significant and valuable contribution of early exposure to financial literacy classes for young people is to address this issue.
At this point, it’s a matter of social justice to ensure that those who need financial literacy are the ones most likely to receive it, rather than the least likely, because eventually, everyone will acquire it, regardless of whether they come from affluent families or attend private schools.
For instance, I can’t tell you how many times I’ve spoken at high schools or colleges and heard students say, “When I graduate, I’m going to owe $15,000 in student loans.” I usually interrupt them and ask them to repeat the phrase, “I now owe $15,000 in student loans,” in the present tense.
Because we have to delay the gratification of our financial decisions to avoid immediate benefits, that’s a psychological shift. Instead of postponing taking a personal finance course for later, you come to terms with your financial responsibility in the present.
That verbal and emotional shift is what ultimately leads to cognitive shifts that will enhance our ability to save for emergencies, spend more wisely, invest for our future, and pursue opportunities that increase wealth accessibility.
How do the financial decisions we make today depend on the financial habits and behaviors of our families and previous generations?
A study examined the habits of a group of college students regarding credit card debt and usage. Growing up with parents who never talked to you about money at all was the most predictive indicator of poor credit card usage or high credit card debt, based on what they observed.
Not only that, but parents who taught you to use a credit card incorrectly, such as purchasing everything on credit, rather than parents who didn’t talk about money at all, were detrimental. Essentially, avoiding conversations about money altogether was the worst thing.
That hit home for me because I grew up in a financially literate household and still ended up with a ton of credit card debt myself.
We both perpetuate cycles because we either see modeled examples or because there’s a void in our minds as we try to figure it out through trial and error, which is often worse than seeing a bad example.
The only positive outcome is to have a household that discusses money regularly and openly. Parents can do this by involving their children in everyday activities, such as “Hey, we’re going to the grocery store, and I’m going to try really hard to stick to a budget of $85. Would you be willing to help me stick to that budget?”
What role, in your opinion, do parents, teachers, and policymakers play in promoting financial literacy education?
As a parent, you have to ask yourself, “How can I impart the key, most important lessons I want them to have about money?” For me, that tends to look like values-based budgeting. If your household is faith-based, you’ll consider budgeting and allowing for tithes since faith-based giving may be very important to your household.
The teacher’s role is to provide an unbiased source of information to compare and contrast things like a credit card versus a debit card and to make critical financial decisions. As an educator, I’m not going to tell you what’s better because that’s a personal value judgment, but I may provide you with the differences using fact-based information.
A policymaker has never had to give a lesson in front of 30 or 40 kids. They’ve never written a curriculum. So, they need to be cautious when crafting financial education policies because they must be careful not to overprescribe how it’s written. Their goal is to create the most flexible legislation possible that mandates financial education in every high school and makes it a graduation requirement.