Good news from our classrooms: More and more young people are learning how to manage their money.
Good news from our classrooms: More and more young people are learning how to manage their money.
T he news from American high schools is pretty negative. Recent data from the National Assessment of Educational Progress (NAEP) indicate that scores in core subjects have dropped to historic lows. In 2024, nearly a third of high school seniors scored below “basic” in reading, meaning they couldn’t identify specific details in a text to understand its meaning. In mathematics, 45 percent scored below basic, the highest percentage since 2005.
Despite these disturbing reports, there is one trend that is an unmitigated plus. More and more schools are offering courses in personal finance. In 2019–2020, 18 percent of high school students were required to complete such a course in order to graduate. In 2023–2024, this figure rose to 27 percent — a 50 percent increase. Plus, 16 percent of high school students get personal finance content from other required courses, and 37 percent have the option of taking a personal finance elective.
This is good news. No American child should graduate high school without exposure to the basics of the complicated financial world he is about to enter. Since it is virtually impossible to live entirely outside the economic system, like it or not, one will need to manage money.
The topics covered by these courses include the very things we all have to deal with virtually every day. They include saving (managing bank accounts, calculating interest), investing (risk vs. return, diversification, stocks, bonds, mutual funds, and exchange-traded funds), credit (loans, credit cards, and debt reduction), managing risk (types and purposes of insurance, including life, automobile, and property), and retiring (pensions, 401(k)s, annuities, and IRAs).
Most kids learn about these things, if at all, from their parents, who may not be so knowledgeable about financial matters themselves. Consider all the adults who make bad economic decisions, not just because they miscalculate, but because they really don’t understand what they’re buying into. Fortunately, evening courses for adults, covering the same subjects as the high school courses, presented in a more sophisticated way, have also become popular.
Personal finance courses are even making inroads in colleges and universities, usually as electives. In addition, numerous college programs to train certified financial planners have been established. The CFP Board accredited 366 such programs as of 2025.
While more than two-thirds of the states require personal finance courses in secondary schools, other states are or soon will be considering doing so. There is a genuine cost advantage to establishing such a curriculum. Unlike the vast majority of courses, which require expensive textbooks, a personal finance course can be mounted with free and widely available course materials. Banks, insurance companies, and government agencies, including consumer protection offices, will gladly provide reading materials to school districts at low or no cost, and maybe even run workshops for teachers. In fact, aside from teacher training, there will be very little budget impact at all from mounting such courses.
While offering personal finance courses seems like a no-brainer, there is always the question of their effectiveness. Do they enhance student knowledge, and perhaps more important, do they affect financial decisions? A 2020 meta-analysis of 76 randomized experiments with a total sample size of over 160,000 individuals found that financial education programs have, on average, positive effects on both financial knowledge and downstream financial behaviors.
Of course, there are always naysayers. A leading criticism from the left is that personal finance courses “blame individuals for systemic problems, reinforcing an assumption that our capitalist political economy is a meritocracy, and that people exploited and oppressed must have a deficit of knowledge, intelligence, morality, or discipline.”
This mischaracterizes these courses. Personal finance classes are “applied,” not theoretical, subjects. They are not classes in microeconomics, which study the behavior of individuals, households, and businesses. Nor are they macroeconomics courses, which focus on the entire economy of a nation or multiple nations. Whether the economic policies of the United States writ large are exploitive or not, individuals and families need to have basic financial knowledge so they can effectively manage their own economy.
There really is no downside to personal finance courses. They arm every student with vital practical knowledge — knowledge they will likely put to use for the rest of their lives. This is one education trend that should be continued and extended.