There’s momentum for personal finance education becoming law in many states across the country.
Even more states could pass legislation this year to make sure students, particularly those at the high school level, have such instruction.
“It’s been a huge change,” said John Pelletier, director of the Center for Financial Literacy at Champlain College in Burlington, Vermont.
Before the coronavirus pandemic, progress on personal financial education had stagnated, he said. But amid pandemic layoffs and the ensuing recession, it became clear that financial literacy is extremely important for students.
“What seems to propel these bills forward is a catastrophe,” Pelletier said.
Who is next
Georgia will likely be the next state to pass a personal finance education requirement, according to Next Gen Personal Finance, a nonprofit.
Both chambers of the state’s general assembly have passed a bill, SB 220, that would require all high school students to take at least a half-credit financial literacy course to graduate, starting with the 2024-2025 school year. The bill is awaiting the governor’s signature to become law.
South Carolina also may soon pass legislation mandating personal finance education. The state has a bill, S16, that’s currently in conference committee. Once Georgia’s bill is signed into law, South Carolina will be the only state in the Southeast that doesn’t require personal finance coursework, according to Tim Ranzetta, co-founder of Next Gen Personal Finance.
“I think there’s an element of [fear of missing out] happening between the states,” said Ranzetta. “That’s why we’re seeing the trend there.”
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Michigan could also advance legislation in the coming months. A bill that would require a half-credit personal finance course for high school graduation passed the state House of Representatives in December and is expected to be taken up by the state Senate in May.
In Minnesota, an omnibus education bill would mandate that high school freshman starting in the 2023-2024 school year take at least a half-credit personal finance course to graduate. And, in New Hampshire, an education bill includes personal finance on a list of things that constitute an adequate education.
So far, there are 12 states that adhere to Next Gen Personal Finance’s gold standard of personal finance education, meaning that they require or will soon require at least a half-credit, standalone personal finance course for high school graduation.
Overall, there are 23 states in the U.S. that have some sort of personal finance education mandate, according to the 2022 Survey of the States from the Council for Economic Education. And 47 states across the country include language about personal finance in their state education standards, though many don’t have required courses.
A popular course of study
Data shows that students and their parents want increased personal financial education available in public schools.
Support for having financial literacy courses polls at 80% or more in California, Florida, Georgia, Michigan and South Carolina, according to Next Gen Personal Finance.
In my states, legislation has also been passed with bipartisan support, often overwhelmingly from both sides of the political aisle. In Florida, for example, the bipartisan legislation was passed unanimously in March.
“It’s one of those common sense issues that cuts across political parties,” said Ranzetta.
What’s next
To be sure, some parents think that it is their responsibility to teach their kids about money, instead of them learning it at school. But few are doing the work, and many parents might not have had great personal finance education themselves.
That leaves it up to state education boards to include personal finance education in laws.
So far in 2022, 61 bills about personal finance education have been proposed in 26 states, according to Next Gen Personal Finance. Of those, 47 bills across 20 states are still alive, meaning they could someday become law.
In addition to encouraging legislation mandating financial literacy courses, advocates are looking at the quality of each bill proposed and if they include teacher training. This is an important piece of the puzzle, as students need confident, qualified teachers that can explain finance.
“Teachers want to be trained in personal finance so they can give their students the best,” said Michael Sheffer, director of education at FoolProof Foundation, which provides free financial education curriculum for students and teachers.
The increased appetite for personal finance courses has helped get more quality education to teachers, a trend that is likely to continue, he said. Next Gen Personal Finance has a goal of making sure that every high school student will have taken at least one semester of personal finance by they graduate by the year 2030.
They’re well on the way to making that a reality, according to Sheffer.
“This is a snowball running downhill now, and it’s getting bigger and bigger,” he said.
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