Nearly 25% of American students have access to a personal finance education
Math teacher Marina White teaches seniors at Canyon High School in Santa Clarita, California, a lesson about investing and the power of compound interest.
Helen Chow | CNBC
Millions of high school students across the United States will graduate in 2022 with one important course under their belt: personal finance.
Recent momentum among states requiring personal financial education in high school means nearly 1 in 4 students will take such a course before their graduation this year, according to Next Gen Personal Finance’s State of Financial Education 2022 report, released Thursday.
This is a big change from 2018, when the first report was released, and only 16.4% of high school students in the country were required to attend a personal finance class. Next Gen Personal Finance, a nonprofit corporation, now feels it is on track to achieve its goal of giving 100% of students guaranteed access to a personal finance education by 2030.
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“We’ve really seen some great progress in terms of secured access,” said Christian Sherrill, Director of Growth and Advocacy at Next Gen Personal Finance.
Bills in progress
In addition to the eight states that currently guarantee that all students will take a course in personal finance before graduating from high school — which Next Gen Personal Finance considers the gold standard — four additional states have passed similar legislation in the past 12 months.
These states—Florida, Nebraska, Ohio, and Rhode Island—are in the process of implementing their own, which means that in the coming years, more than 32% of students in the United States will have a personal financial class requirement.
“In five or six years, the percentage of students across the country with guaranteed access to a personal finance class has doubled,” Cheryl said. “We are pleased to see this uptick in growth.”
Other states also have bills pending that may be passed later in the year, expanding personal finance education efforts across the country. The next action in Georgia is likely to be law — both state houses approved the legislation and sent it to Governor Brian Kemp, a Republican, for signature.
“When you start to see Ohio and Florida states really cross the finish line, other big states show that it’s possible,” said Tim Ranzetta, co-founder of Next Gen Personal Finance.
Access in countries without authorizations
To be sure, there are high schools in states that do not have a mandatory personal financial education that offer such classes.
But the report found that local offers are often unequal. Overall, 1 in 10 students in a state that does not mandate a personal financial class has access to such a course. In schools where 75% of students are non-white or receive free and reduced lunch, that quota drops to 1 in 20.
“A lot of schools that don’t feel they have the resources to implement this course end up not doing so,” said Yanelli Espinal, director of educational outreach at Next Gen Personal Finance.
She added that many schools that mostly serve minority students or in a low-income community are among the first to see staffing problems and therefore may not have enough teachers to offer an additional course.
“If that is not really a requirement, then it means that they are unlikely to have the resources, in terms of human capital, that can serve every student,” Espinal said.
This factor is one reason why a subsidiary of Next Gen Personal Finance, called the NGPF Mission 2030 Fund, is calling for all states to pass legislation ensuring personal finance education in high school.
to go forward
The group also wants to see the semester’s independent course in personal finance before graduation become a national standard.
Currently, approximately half of American high school students have access to such a course as an elective, but not a requirement for graduation. Another 25% receive some personal finance instruction that is included in another course.
To cover everything a high school student should know before graduation, an entire semester is needed, according to Next Gen Personal Finance.