Financial literacy, and the role of K-12 schools in promoting it, is getting lots of attention these days. To date, some states have developed standards for teaching financial literacy, but where do schools turn for resources to implement those standards and who do they turn to for advice on what aspects of money management they should teach and when?
As a country, our financial literacy skills are dismal. Nearly two-thirds of Americans can’t pass a basic financial literacy test, and data from the Federal Reserve show that consumer debt hit an all-time high in early August.
For youth, the outlook is not much better. In 2015, the PISA financial literacy assessment found that 15-year-olds in the U.S. scored below the OECD mean. Clearly, education should be doing more to ensure that students are graduating with financial literacy skills, and while most K-12 teachers understand the importance of teaching financial literacy, as shown in a 2016 survey, only 12 percent teach it.
This article offers suggestions for how to teach financial literacy.
Where States Stand on Financial Literacy
First, educators need to understand the landscape when it comes to implementing state-wide financial literacy standards. The Jump$tart Coalition for Personal Financial Literacy provides this overview of state K-12 efforts:
- 45 states (+DC) include personal finance in their literacy standards.
- 37 states (+DC) require the standards be implemented.
- 22 states (+DC) require a high school class be offered.
- 17 states (+DC) require a high school class be taken.
- 7 states (+DC) require a standardized test on personal finance concepts be administered.
In states that do offer financial literacy, implementation of the standards varies widely. At the high school level, financial literacy curriculum is often delivered as a separate course within social studies, consumer science, or business. In elementary and middle schools, there is often debate over which traditional subject should incorporate the standards. However, given the research on the importance of numeracy, a solid math education will go a long way in promoting financial literacy.
(Next page: What to teach and where to find materials for financial literacy)
What to Teach and Where to Find Materials
Whether legislated to do so or not, incorporating financial literacy into the K-12 curriculum can be challenging. Even with good intentions, a lack of funding for materials or lack of appropriate training for teaching staff can hamper the implementation of an effective program. As with other things in the public education arena, mandates often don’t come with financial resources to aid implementation.
So where should schools begin? If a school or district is starting from scratch, the Jump$tart Coalition has published national curriculum standards. They’re good for teachers, after-school programs, and parents looking to give their children a financial “leg up” in the world.
But even with Jump$tart’s standards, finding resources and materials to teach to those standards is another obstacle. There are lots of options out there, but it’s important to find unbiased and vetted materials. One option is to let the Jump$tart Coalition “clearinghouse” do the sorting. The Jump$tart Coalition classifies materials by subject, media type, targeted age group, and price. This list includes free resources, as well as materials for purchase. Another good source for materials is the Federal Reserve. Materials on economics and personal finance produced by the twelve District Banks and the Board of Governors are available on one site, where educators can search by age group, type of material, standard, or topic.
For high schools looking for a curriculum that is ready to go, there are three non-profit organizations that offer complete curricula, including assessments:
"Nearly two-thirds of Americans can’t pass a basic financial literacy test." #financialliteracy
- Inceptia–Inceptia’s Financial Avenue is a comprehensive set of online lessons based on the S. Department of the Treasury’s Financial Literacy and Education Commission’s financial education core competencies. The videos are compelling, and the first lesson is an explanation of the psychology of money—a subject often overlooked in financial literacy courses. Teachers simply request an account and access code, and they can assign lessons to students and monitor their progress.
- NexGen Personal Finance (NGPF)–NGPF has a wide array of materials available to educators. Educators can build their own class from the 12 units on the NGPF site, including curated videos, activities, projects and assessments, or they can use the recently released semester-long course of 90 45-minute lessons. Teachers need to register to gain access to the assessments.
- The National Endowment for Financial Education (NEFE)–NEFE’s High School Financial Planning Program draws from all recognized national standards for its turnkey curriculum aimed at grades 8 through 12. Teachers must register to receive access to materials, but can choose between digital and print versions.
Another free resource is OppU, an online curriculum developed by OppLoans. OppU teaches financial literacy through concise, interactive video lessons and quizzes. It’s free and can be used by guidance counselors, parents, or teachers looking to augment their lessons. The site is optimized for display on mobile devices, making it good for students who prefer to complete lessons on their mobile phones or tablets rather than on a PC.
Elementary and Middle School
Research suggests that the overarching factor helping children grow into financially capable adults is numeracy, or facility with numbers. It does no good to teach children how a loan works if they don’t understand the math behind it. So for starters, educators should get students comfortable with numbers. They can even incorporate money directly into teaching mathematical concepts.
- Counting money can be used to teach grouping, addition and multiplication.
- Decimal and percent lessons can be centered on money, like calculating sale prices and discounts.
- Fraction lessons can teach exchange rates.
- Lessons on exponents can incorporate compound interest examples.
Even storytelling can include numbers. Educators can build a tale about choosing between being paid $1,000,000 for a month of work, or being paid a penny on the first day and receiving double every day after that. (Hint: the penny doubling is a much better deal.)
Wherever schools are on the financial literacy education continuum, selecting the right resources can help them make progress toward ensuring future generations are financially literate. Start with a program that seems like a good match, and adjust or switch as necessary. The important thing is to get started!