High
schools teach more kids basics in Finance 101
By Kathy Chu, USA TODAY
January 2, 2007
More teenagers are facing a novel requirement to graduate
from high school: learning to balance their checkbooks.
At
a time when students are beset with advanced math,
science and English requirements, a growing number of
states are adding personal finance to the class
roster.
These states say that teachers' responsibilities
don't end at preparing students to make money:
Schools should
also teach students how to manage it.
Personal finance "is as important as history or
economics," says West Virginia Treasurer John Perdue,
who successfully championed this new requirement,
as part of a civics course, in his state. "If you
don't manage your money well, you're not going to have
a successful
(financial) life."
In 2006, 14 states required high
school students to learn concepts such as opening bank
accounts and maintaining healthy credit scores before
graduating,
double the number of states two years ago, according
to the National Council on Economic Education
(NCEE) and Citigroup's Office of Financial Education.
States are recognizing that financial literacy is
an important "skill for the 21st century," says
Joseph Peri of NCEE. "We don't wait until college
to teach students how to read. Why would we send
them into college without teaching them these important
money-management skills?"
The movement toward personal-finance education comes
at a time when the financial world has gotten more
complex, with college costs skyrocketing, credit
card fees rising and exotic mortgage products proliferating.
Young adults, for the most part, are as confused
as
ever about money matters.
High school students failed a 2006 quiz from the
JumpStart Coalition for Personal Financial Literacy,
correctly answering an average of only 52.4% of
questions about credit cards, insurance, retirement and
savings.
This is well below high school students' average
57.3% score in JumpStart's 1997 poll, but up from a 50.2%
low in 2002.
Not every state is itching to adopt personal-finance
education. Tight budgets or class schedules prevent
some from doing so. Others struggle with getting
students excited about complex concepts like credit card
interest
rates and mortgage payments.
Visa and Citigroup, among others, are trying to engage
students by incorporating games into free personal-finance
curriculum they provide to schools. "Teachers
tell us that financial literacy is important, but
it's deadly dull," says Jason Alderman, Visa's
director of financial education. But some consumer
advocates
question whether for-profit financial companies
are the best source for personal-finance resources.
Also,
while "improving (financial) knowledge is
a necessary first step, it's not sufficient," says
Travis Plunkett of the Consumer Federation of America,
an advocacy group. "There needs to be a focus on
measuring whether these programs lead to positive
financial behavior" among young adults.
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