If there's an upside to the economic rollercoaster we've been on lately, it's that it makes what could sometimes seem like a dry, academic subject very, very real. And when it comes to teaching teens about money management, there's nothing like a little reality to get their interest.

Whether you're watching the national news together or discussing your own financial situation at the dinner table, now's the time to get your kids to listen and actively learn from the economic challenges we're all facing. It's a tall order, but you're not alone. The continuing efforts of the President's Advisory Council on Financial Literacy in conjunction with schools, teachers and community groups across the country are putting the spotlight on the urgent need for greater financial knowledge and awareness.

2nd National Financial Literacy Challenge — Real and Rewarding

The National Financial Literacy Challenge, an initiative of the President's Council in cooperation with the U.S. Department of the Treasury, is a good example of a tangible financial education program with practical results. Designed for high school students across the country, it's a 35-question online test of personal finance. Here are a couple of sample questions from last year's test. Can you answer them? Can your teen? (Answers at the end of the column.)

1. If you deposit $1,000 in a savings account with a fixed annual interest rate of 5 percent, how much will you have in your account after two years if you make no additional deposits or withdrawals?

A. exactly $100

B. exactly $1,100

C. less than $1,100

D. more than $1,100

2. You have $400 in the bank, and $50 in your wallet. You owe $3,000 on a car that is worth $4,000. Your other personal possessions are worth a total of $2,000. You also take home $800 per week from your job. From this information your wealth — or net worth — currently equals:

A. $3,050

B. $3,450

C. $4,250

D. $7,250

Is it too easy? Not according to the results of the first Challenge given last spring. Forty-six thousand students took the test, and the average score was only 56 percent. Not exactly great, but it was a start. Thirty-five teens did achieve a score of 100 percent, and, of those, 10 regional winners were selected by lottery to receive scholarship awards funded by Charles Schwab Foundation.

Now students across the country are gearing up for the Second Challenge, which will be administered from Nov. 3-26.There has been a lot of support from parents as well as teachers, and this fall, twice the number of participants are expected. (Teachers can sign up their students at www.flc.treas.gov/index.htm.) And this time as many as 100 students can win a scholarship, along with a grant to the school or organization that contributed to the student's financial education. High-scoring students will also receive medals and certificates of recognition from the Department of the U.S. Treasury.

An Inspiration, An Opportunity — And a Responsibility

I believe that through efforts such as the Challenge, we have the opportunity to raise awareness of the need for more financial education and at the same time reward the students and schools that do an outstanding job. These kids — and their teachers — can then inspire others with the message that learning about money management is not only smart, it's essential.

But the opportunities don't begin or end with the Challenge. While programs like this can raise national awareness, it's up to all of us to step up to the plate and make financial literacy a top priority. The teachers I've spoken to agree. They note that many kids (and let's be honest, many adults, too) don't know how to balance a checkbook, don't really understand the difference between a credit and a debit card, don't understand compound interest and on and on.

On the positive side, the teachers say that once the kids are tuned into how these things work, they get excited because they see it really does apply to their own lives. So as parents, grandparents, educators, community leaders — anyone who interacts with or has an influence on young people — it's up to us to take the initiative to introduce financial topics, share our experiences, encourage the expansion of financial education in our schools and create an understanding of how and why money management skills apply to real life. It can be as simple as starting to talk openly about money at home.

Not a Moment Too Soon

With the economy the No. 1 issue on Americans' minds today — and the No. 1 struggle for many people as they try to pay bills, manage debt and plan for the future — the importance of teaching kids how to handle everyday financial transactions can no longer be ignored. We can't afford it, and neither can they. All of us have to be responsible for our own financial well-being. The sooner we can teach our teenagers money skills, the better equipped they'll be to handle challenges like those we're facing today — and whatever the future holds for them.

(Answers: 1. D, 2. B)

Carrie Schwab Pomerantz is Chief Strategist, Consumer Education, Charles Schwab & Co., Inc., Member SIPC. You can e-mail Carrie at [email protected]. To find out more about Carrie Schwab Pomerantz and read features by other Creators Syndicate writers and cartoonists, visit the Creators Syndicate website at www.creators.com.