GALLOWAY TOWNSHIP — There are plenty of financial lessons for young adults to learn the hard way: How a poor credit history makes mortgages costlier; how credit card debt can quickly burden the borrower; how building a retirement nest egg is much harder at 45 years old than at 25.

But financial literacy education in high school can teach these lessons, too.

The commissioner of the state Department of Banking and Insurance spoke to Absegami High School students Tuesday to mark the conclusion of Financial Literacy Month.

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Students at Absegami take a five-credit, year-round financial literacy class before they graduate, said Dawn Kosko, a business teacher.

In New Jersey, all public high school graduates need at least 2.5 credits in financial literacy, a requirement that took effect this school year.

Kosko said students typically go into the course understanding some basics about credit, but less about investing, insurance and other subjects.

These topics become more visible to them as car loans, automobile insurance and college loans get closer, she said.

“Especially junior year when they’re getting their drivers’ licenses and buying cars and need car insurance and are looking at colleges and loans, I think you definitely need to get them — early is better — but it becomes more relevant to them when they’re doing everything at that point,” she said.

Ken Kobylowski, commissioner of the state Department of Banking and Insurance, spoke to some sophomore, junior and senior students in the school’s auditorium about credit cards as a tool to develop credit history, one to be used carefully.

“Not all loans are created equal. Someone with a better credit score is going to get a lower rate on a loan. Why? They’re a better credit risk … the greater the risk, the higher return the creditor is going to want,” he said. “If there’s a better chance they’re going to get their money back, you’re going to get a lower rate.”

For example, says a 30-year, $300,000 mortgage will cost $187 less a month with a 5 percent interest rate than a 6 percent one.

Kobylowski urged paying off credit card balances every month.

“Credit cards are a form of borrowing. Please never make the mistake of charging something that you can’t afford to pay at the end of that month. That’s the worst mistake people make,” he said.

Kobylowski addressed student loans and highlighted an unfortunate consequence of some of them.

Some loan debts — such as a federal Perkins Loan — are discharged if the borrower dies, according to the U.S. Department of Education.

But debt from some other loans types requiring co-signers may not be forgiven.

“Something you may not want to hear, but it probably makes sense depending on the loan product, is to have life insurance on your life. Why? ... If your parents are cosigning a student loan for you and God forbid you’re a junior in college and you die, your parents have to pay back everything that’s been borrowed as the co-signer,” he said.

“It’s not something a lot of people want to talk about, purchasing life insurance on someone 18, 19, 20 years old, but it’s really a smart financial play and move. It’s very cheap so you may want to talk to your parents about that if you haven’t already,” he said.

Kobylowski will be back in the region later this week.

He is hosting a similar financial workshop and question-and-answer session for college students at 9:30 a.m. Friday at Atlantic Cape Community College in Mays Landing.

He will discuss credit cards, life and health insurance, and student loans, as well as setting budgets and shopping for banking services.

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