LUBBOCK – A new report shows that while most states, including Texas, are doing a better job of teaching high school students financial skills, there is still room for improvement.
The Center for Financial Literacy at Champlain College issued a recent report card on how well the 50 states are doing at sending students out into the world knowing the basics of personal finance. John Pelletier, director of the Center, said while high school students need to know how to handle things such as checking accounts, investing and credit cards, if they plan on going to college, they will also need to know how a student loan works.
“Two-thirds or more of all students across the country are graduating with student debt, and yet we’re not giving them the skills and the foundational knowledge they need to handle that debt responsibly,” Pelletier said. “I think we kind of have a moral obligation to do that as a country.”
The report gave fewer than half the states the highest grades – an A or a B – for their financial curriculum, while 27 states earned a C, D or an F. Pelletier said states that earned the top grade require high school students to complete a comprehensive, stand-alone course on financial literacy.
He said only five states earned an A, and added that Texas earned a B.
“A B is a state that requires a course for graduation that includes personal finance be taught as part of that,” he explained. “Most states who get Bs – there are 19 of them – do this through a required economics course.”
In 2012, Texas began requiring public and charter high schools to offer Personal Financial Literacy as a 0.5 credit elective course.
Pelletier said the Center’s studies found that many people reach a point in life where they wish they had learned more about handling money when they were younger.
“They’re asked about things that they wish they had been taught when they were in high school – many of them talk about personal finance,” he said. “So I think people regret this much younger than in their 40s or 50s. It can be a regret in their 30s, because we all make financial decisions that impact us.”
Pelletier said the study shows financial literacy is linked to positive outcomes such as wealth accumulation, stock market participation, retirement planning and avoiding high-cost financial services such as payday lending and auto title loans.