Relates to the development of financial literacy education

1 Co-sponsor

• Bill Perkins

BILL NUMBER:S7344D

Title of bill

An act to amend the financial services law, in relation to financial literacy education

Purpose

In order to strengthen the financial capability of our youth, this legislation establishes the Financial Literacy Education in the New York State Summer Youth Employment Program Act.

Summary of provisions

Section 1: Legislative Intent.

Section 2: The financial services law is amended by adding a new section 311 to read as follows: Any youth participating in the Summer Youth Employment Program shall be provided with financial literacy education according to practices and best standards of currently operating summer youth employment programs or other similar model used by local govern- ment in coordination with nonprofit organizations and/or financial institutions for any summer youth employment program that do not have such a program already in place. This section also defines the Summer Youth Employment Program.

Section 4. This act shall take effect July 1, 2016.

Justification

In order to contribute to the State's and nation's future financial stability and increase upward economic mobility, it should be the policy of New York State Legislature to promote financial capability among its youth and encourage building the financial capabil- ity of young people at an early stage in schools, families, communities, and the workplace; such as the State's Youth Employment program. Each year and for thousands of youth, the summer youth employment program is their first exposure to a job and a paycheck. Engaging these youth in basic financial literacy instruction, such as creating a savings account, balancing their budget, and managing their disposable income is tremendously important.

By starting early, young people can begin to learn the difference between wants and needs, the importance and power of saving, and the positive and productive role money can play in their lives. Having a basic understanding of money management from an early age will make our young people better equipped to tackle more complex financial decisions in their transition to adulthood, when critical decisions about financ- ing higher education and saving for retirement can have lasting conse- quences for financial security.

Strengthening the financial capability of our young people is an invest- ment in our State's and nation's economic prosperity. Financial capabil- ity is the capacity, based on knowledge, skills, and access, to manage financial resources prudently and effectively. Efforts to improve finan- cial capability, which should be based on evidence of effectiveness, empower individuals to make informed choices, plan and set goals, avoid

pitfalls, know where to seek help, and take other actions to better their present and long-term financial well-being.

Therefore, in order to strengthen the financial capability of our youth it is important to establish financial literacy education in the New York State Summer Youth Employment Program. The summer youth employment programs that have already developed financial literacy components for their participants are not impacted by this legislation. However the bulk of the programs that do not offer such critical pro-youth and pro- consumer education will have the resources to build the financial liter- acy of the communities they serve.

Fiscal implications

None. Local banks and credit unions as well as consumer groups have developed materials for all age groups on financial literacy. The collating of available materials is all that is required.

Effective date

This act shall take effect July 1, 2016.