A financial literacy app launching later this year aims to teach children how to manage their money, improve their earning potential and bridge the wealth gap among underserved communities.
The new app-based game for children called Berryville is based on certified financial planner Mac Gardner’s The Four Money Bears book. Designed for kids ages 5 to ten, the story explores the four basic functions of money — spending, saving, investing and giving — through a family of bears. Throughout the story, each bear represents a function of money, and teaches young readers healthy financial habits to accomplish their goals.
By the end of the story, the interactive book allows parents to help kids create their own budget for every month of the year. Gardner first came up with the idea after publishing his first book in 2013, Motivate Your Money, which guides adults through five steps to improve their personal finances.
While the book has been successful, Gardner quickly realized more needed to be done to reach children in this digital age.
“People around the world want to find a way to start a conversation with their kids about money but often don’t know how to begin,” Gardner told Yahoo Money. “It’s not just financial literacy, in my mind the end goal is financial wellness. We’re living in an amazing age where there's so much tech, I think tech is what’s really going to make an impact on a scale that can reach underserved, overlooked communities.”
Financial literacy apps can reach more children
During the 2020-2021 school year, 7 out of 10 students in U.S. high schools had access to a personal finance course, and only 2.4 million (1 in 5 students) were guaranteed to take a course ahead of graduation, according to Next Gen Personal Finance, a nonprofit supporting personal finance education for children.
While a growing number of state and local governments have taken action to include personal finance education in school curriculums, financial literacy advocates argue there is still work to be done. Currently, only 21 states require personal finance coursework in schools, and seven states mandate it as a standalone course.
Additionally, in schools with a 75% of Black and Brown student population – only 1 in 14 students were guaranteed a personal finance course before graduating.
“When I first wrote the Four Money Bears, I sent the copies of the book to 30 school boards. I soon found out that the process to get a book approved in a public school is mind-blowingly hard,” said Gardner. “When I would go to my kids' school to read, I noticed that a lot of children are learning digitally – on iPads or computers. When we were developing the app, we wanted to make sure that whatever financial literacy tool we were developing meets kids where they are.”
With the Berryville app-game, children have the opportunity to build and manage their own farm wherever they go. The demo, now available for Google Play, Apple, and Android devices, will allow players to experience the process of entrepreneurship, understand the basic functions of money, and develop healthy financial behaviors they can take into their adulthood.
The Berryville app has surpassed its Kickstarter campaign goal of $25,000, having gathered $27,505 funds.
“The app focuses on both sides of personal finance: entrepreneurship and how money is earned, and then we’ll have quests and quizzes to teach them how to manage their money and how it works,” said Gardner. “It helps socialize the idea of financial education at an early age, which is the key to long-term financial wellness. While children learn financial habits, parents will also be able to track their progress on the app.”
Financial literacy impacts Americans differently
According to the TIAA Institute, Black and Hispanic populations often scored lower on financial literacy measures. Women of color were also at a disadvantage compared with white women. The analysis, based on the 2018 National Financial Capability study, suggested that financial education programs inadequately addressed the needs of Black and Hispanic women.
Approximately 66% of Americans are unable to answer more than three of the five questions on a basic financial literacy quiz correctly, according to FINRA. Findings also showed that most consumers failed to comparison shop for credit cards, with 56% saying that in obtaining their most recent credit card – they did not collect and compare cards from more than one company.
“Money-management is an important contributor to financial well-being, and minorities are often at a disadvantage,” said the TIAA report.
According to Gardner, technology can really bridge this educational gap on financial literacy for underserved communities, and children that may not get educational opportunities at school or at home to learn about financial wellness.
“Financial education can close the wealth gap. We have all the data that shows that because we incorporate these lessons at an early age – these kids' financial lives are much more successful,” said Gardner. “Learning financial habits can turn into financial behaviors and then later traits we implement as adults. If we have the tools to introduce children at such a young age to these concepts – that can really make a difference.”
Gabriella is a personal finance reporter at Yahoo Money. Follow her on Twitter @__gabriellacruz.