Twenty-two states have passed laws requiring all high school students to complete a standalone Personal Financial Literacy (PFL) class to graduate, with more states steadily joining the lineup. Connecticut achieved this “gold standard” of financial literacy education last week, and Louisiana achieved this status just today! This means five states have joined the “gold standard” PFL team during this spring legislative session, with Connecticut and Louisiana joining West Virginia, Indiana, and Minnesota in requiring high schools to mandate the one-semester financial literacy course.
However, despite the steady increase in the number of states requiring financial literacy education, more work needs to be done to ensure that these courses are academically rigorous and up-to-date on modern spending, banking, and investing practices. The National Financial Educators Council (NFEC) reports that none of the U.S. states have sufficient academic rigor in their PFL courses. The NFEC wants financial literacy education, which will benefit all students significantly, to be given the same treatment as core subjects like math, science, language arts, and social studies.
How PFL Can Receive Core Subject Treatment
Although some of the NFEC’s report is rather generalized, and many core subject teachers would take issue with the assertion that not all students will benefit from their respective subjects, some key takeaways would improve financial literacy education in the states. First, the NFEC takes issue with the lack of assessments and testing. Although twenty-two states currently have or will soon have students taking a standalone PFL course, how will it be determined whether the students learned the crucial material? Standardized testing is controversial, but it does ensure that students are expected to learn important concepts.
In addition to a standalone PFL course in high school, the NFEC also wants to see financial literacy education begin in elementary school. Some states have begun this process through embedded financial literacy standards in elementary school courses, but perhaps at a low level of rigor. The NFEC uses Bloom’s Taxonomy to analyze the rigor of financial literacy education, and reports that states have lower levels of academic rigor for PFL courses than for core courses. In current PFL classes, students are expected to do little higher-level thinking when learning about spending, budgeting, and investing. The NFEC wants students to be more active in applying the financial literacy concepts they are learning, such as simulated investments and budgets, rather than simple vocabulary worksheets.
Finally, the NFEC critiques the relevance of some state standards for PFL classes. Its review of state literature has discovered some outdated standards like “balancing a checkbook.” Another standard, “receiving an inheritance,” is likely not something pertinent to high school seniors. The NFEC wants state education agencies and district curriculum development teams to be more active in updating standards to ensure students learn valuable concepts. For example, a standard covering the basics of cryptocurrency – a popular new investment – could replace a standard covering the history of paper currency.
Fortunately, the NFEC provides its own suggestions for curriculum mapping, thereby providing potential solutions instead of just declaring that there are problems. It also encourages schools and school districts to adapt PFL courses to the socioeconomic conditions of the community, such as focusing more on budgeting skills for working-class students rather than higher-risk investment options.