According to a report on NJ.com, eight NJ high schools are piloting a new program to teach personal finance to students beginning in the Fall. They plan to teach about budgets, saving, investing, credit cards, and debt in order to prepare these students to enter the “real world” after they graduate from high school. Of course, one thing that is missing is teaching these children how to choose the best personal finance software, in order to help them manage their finances.
According to the article:
As part of the revamped high school graduation requirements the state Department of Education unveiled a year ago, the high school class of 2014 — this fall’s freshmen — will be required to take a financial literacy course before receiving their diplomas.
There has been much publicity given to the marketing techniques of credit card companies on college campuses in the last few years. In fact, a portion of the Credit CARD Act of 2009 addressed some of these issues. However, changing the rules in order to protect our young adults is only part of the solution. They need to receive financial and economic education, so they are better prepared to make decisions that will greatly affect their future. By the time most people graduate from college they are already saddled with debt:
According to a study last year by lender Sallie Mae, 84 percent of college undergraduates had at least one credit card, and the average was 4.6 credit cards. The average balance was $3,173, and a slim 17 percent said they regularly paid off the cards each month.
In order to combat these trends, schools will add personal finance to the required curriculum:
New Jersey is one of 13 states requiring coursework in personal financial literacy for its high school graduates, up from seven in 2007, according to the Council for Economic Education. Schools can offer a semester-long course, or the subject matter — credit and debt management, planning, saving, risk and insurance and becoming a savvy consumer — can be embedded in existing business, science or social studies courses, said Janis Jensen, director of the state Department of Education’s Office of Academic Standards.
photo credit: Old Shoe Woman
Of course I may be a little bit biased, but I believe that finance and economics should be taught in every grade from elementary through college! It’s not enough to discuss a topic a couple of times a week for a few months and think that students will be prepared to make wise financial decisions. If we begin to teach them about personal finance early in life, then they will stand a great chance of earning a debt free college education!
Besides the limited amount of time spent on the subject, one of my major concerns with this program is that many (if not most) Americans are completely clueless when it comes to personal financial management. This means that many of the teachers charged with teaching economics and finance to these students are not qualified to do so.
A few questions for you:
- Should we incorporate economics and finance into the curriculum?
- Should we start earlier than high school?
- Will this have an impact on these students?
- Should the teachers receive training before instructing in these topics?
I look forward to your comments and questions.
© 2010 – 2011, Khaleef Crumbley. All rights reserved.
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{ 12 comments… read them below or add one }
I think personal finance knowledge should start in earlier than high school. because a strong background on financial management help the awareness for people.
I teach Personal Financial Literacy in Oklahoma which is required by State Law to successuflly complete before graduation. Law was passed in 2007. I teach it througout one semester and they have follow up in higher grades.
That is great! I hope that the school systems continue to see the need for it. Actually, I would love for it to start at an earlier age; but ultimately, it should begin at home.
How do your students respond to your Financial Literacy class?
It is a law in NJ and every high school student now needs a 2.5 credit PF course to graduate starting with this year’s freshman. Other Business Ed. courses will suffer due to this requirement. I also don’t think economics class should count, if you see the standards, the content of econ. is very different than managing your personal pocket book. N DOE needs to develop an on line version available to all students (funded mandate). There are companies that produce online versions that school can purchase. There are program offered by organizations too. I feel the general population needs this “general knowledge”. It is a shame it had to be legislated. Some high schools have offered this for years because they were educators that saw the need for such knowledge.
Financial literacy has been always a problem to even professionals( you might hear stories of doctors and engineers go broke). So it is good to introduce it at high school level where they can start to be accountable for their own money.
A strong background on financial/money management not only helps people to be more aware about handling their own finances but it decreases chances of money related issues that come up in divorce or even the overall nation economy that strongly depends on its citizens.
You make a good point about the other issues that are affected by a poor understanding of money management. Let’s home this program is a start to changing that!
It is about time. Although I might not agree that Personal Finance should be taught through all grade levels. I think that the initial seeds of good money management should come from the parents, so the kids understand good money habits in the context of their own economic situation at home. As they go through higher grades, a more holistic picture could be painted that brings new insights and contrasts with what they already know.
Thanks for the comment! I think that is a great idea. Parents & teachers must have a good understanding of personal finance in order for this to be successful. They can even have assignments to highlight lessons that they learn in their everyday life.
All I have to say is, about time!
Well, I guess I have more to say…
I think personal finance education should start in middle school. Sure, it is also a parent’s job to teach how to handle money, but not all adults are competent at money management either.
I definitely think that teachers should be educated first, if it is not already their area of expertise. Just like how an art teacher should have some knowledge of drawing before trying to teach it. There is so much room for personal bias that I think some education up front would be essential.
of the the teachers should get instruction, teachers need to know about this information before they can teach it to anyone. and i think we should include this into the hs curriculum and maybe even middle school, the earlier the better. even small things life saving is important. if i had learned about the economics or more specifically credit cards and the importance of credit and debt, i probably wouldnt have made the ridiculous financial choices my freshman year that im paying for today.
I agree with you 100%! How can we expect some of the people who continue to make horrible financial decisions to train others? Economics and personal finance should be required learning for all ages.
How would you incorporate it to children? Would you try to design games?
it would have to be games for young children. or they wouldnt understand it. i think using classroom tools such as using fake money to purchase tools within class like pencils or erasers and borrowing and how to save your fake money to play certain games toward recess. rewards for students who are able to use their money wisely or made good attempts to save. it can be done.