With an increasing portion of the population pursuing college education, it has also become increasingly important to ensure that these college degrees cover everything an individual needs to know to succeed. One area that’s often been overlooked, both in public schools and universities, is the issue of finance and budgeting. While public schools in many states have taken steps to increase financial literacy, they largely focus on personal finance rather than the business applications. In the brave new world of the gig economy, however, understanding business finance is becoming almost as essential to success as understanding personal finance, since many people are working as contractors or self-employed. So what can students and colleges do to ensure they have the business finance knowledge necessary to thrive in the modern working world?
For students, one option worth considering is simply to earn a finance degree. Finance degrees tackle budgeting, investment, risk, and valuation, which can help those who are just getting started running a business of their own or handling personal finances in a business-like way as a result of self-employment. Finance degrees, of course, also have wider applicability, opening the door to careers in corporate finance, banking, or insurance, some of the highest-earning jobs available. While it’s true that not everyone is cut out for a full career in finance, the importance of understanding the basics of finance makes this one choice that’s still worth considering.
Individual courses in finance are often locked behind admission to a business major, which can severely limit who has access to this kind of education. Relaxing restrictions on some finance courses would be one move that colleges could do to expand financial literacy. Finance courses are often heavy on mathematics, particularly statistics and growth formulas, so one option might be to make certain finance courses an essential part of the general education requirements in math. Indeed, master’s degree programs in finance often qualify for Science, Technology, Engineering, and Mathematics (STEM) designation due to the amount of math required. For those who often wonder “what use will math have in my everyday life?” finance can make a convincing argument for the utility of upper-level mathematics.
Finance also has applications that go far beyond doing business with money directly. Even an art major constructing art pieces or installations will have to develop budgets for materials and estimate the value of their labor. Particularly difficult art, such as painting a mural on a high building, may even need to factor in the risk of harm and the insurance needed to cover that risk. In fact, any kind of project that someone might take on, be it a paid work project, a volunteer event, or personal construction, can benefit from an understanding of finance. Avoiding cost overruns and managing the risks not only helps to ensure that projects are completed on time and as expected, but also makes you look much better and more skilled as a leader. Those who are able to finance correctly and complete projects on time will see greater success over the course of their careers, as the managers and executives above them recognize their ability and entrust them with more responsibility.
Whether you’re working alone or in a corporate environment, or if your field is within the realm of business or not, understanding finance, particularly in that business context, is a key skill in the modern era. A skill that’s so valuable should be encouraged by colleges, and be made a major part of the general education that all students receive. In the mean time, until colleges and universities make these changes to the general curriculum, college students should try to pursue these classes and skills on their own, and may even want to consider master’s programs that include finance such as MBAs. Business finance is a critical part of modern life, and better understanding on a wide scale can only improve efficiency in the world.