Report cards are in: 66% of states earn a ‘C’ grade or worse for personal finance education, new study finds

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States could do a far better job of teaching financial literacy in their schools, a new report suggests.

To that point, 66% of states earned grades of C or worse for such instruction, according to the Nation’s Report Card on Financial Literacy, a study released by the American Public Education Foundation.

Just 17 states were given grades of A or B.

“Too many of our children are coming out of school not fully equipped with the tools needed to operate in this competitive global economy successfully,” said David Pickler, executive director of the American Public Education Foundation.

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“Financial literacy is really a fundamental building block for a child’s ability to make good choices and for their ability to survive and thrive,” said Pickler, who also is a certified financial planner, as well as the president and CEO of Pickler Wealth Advisors in Collierville, Tennessee.

The report relied on factors like graduation requirements, standards and curriculum to create its scores. Just five states — Missouri, Nebraska, North Carolina, Utah and Virginia — received an A grade for mandating personal-financial education from kindergarten through 12th grade and requiring a stand-alone personal finance course for high school graduation.

Another 12 states received a B, 19 states earned a C and 12 were given a D.

Meanwhile, four spots — Alaska, the District of Columbia, Puerto Rico and South Dakota — got an F for failing to guarantee any financial literacy instruction at all.

Getting taught the basics at home is iffy as well. While some parents may do a great job at teaching their kids about money, many adults are also lacking in financial literacy.

“I understand the role of parents as ‘first teachers’ … but in many cases, we have parents who frankly are woefully [unequipped ] to mentor their children,” Pickler said. 

“We’re believers in tools for adults to improve their financial literacy as well, but we have to try to address the issue where it has the best chance of success, and that’s with the … children in our public schools,” he said.

Financial literacy is really a fundamental building block for a child’s ability to make good choices and for their ability to survive and thrive.
David Pickler
Executive director of the American Public Education Foundation

Research shows that students who take personal finance classes are more likely to demonstrate responsible financial behavior. For example, such coursework decreases the likelihood of carrying a credit card balance by 21%, according to the National Endowment for Financial Education.

Curriculum generally focuses on topics like savings, credit, debt, investing and financial decision-making, among others.

However, there is little consistency across states in how that instruction is delivered. Some require an expansive personal-finance course while others offer it as part of another class, such as economics. Moreover, it often is not mandatory for students.

While a minority of states earned kudos in the foundation’s report, advocates are hopeful the grades improve. As of early June, 25 state legislatures had introduced or passed legislation this year that would increase access to financial education, according to Next Gen Personal Finance’s bill tracker.

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