How Students in Washington State are Gaining an Edge in Money Know-How

Under standards adopted this year, schools in the state of Washington now must include courses in financial literacy. For the first time, personal finance topics will be incorporated into classroom activities. These include saving, investing, wages, insurance, credit cards, employment, risk management and financial decision-making.

Financial subjects will be introduced mostly in math and social studies classes at all levels. For example, students in the second grade will compare different kinds of savings styles, such as piggy banks and actual banks, as a way to learn about risk and return. By 12^th grade students will learn how to develop a personal financial plan with goals, calculate net worth, and plan an estate.

The decision to incorporate financial literacy into the state curriculum came out of a Financial Literacy Public-Private Partnership convened in 2004 by the State Legislature and re-commissioned five years later as the Financial Education Public-Private Partnership. A bill in the Legislature last year directed the partnership to write the new standards, which are based on those from the JumpStart Coalition and the Council for Economic Education.

School Superintendent Randy Dorn noted that if more individuals were financially literate they might have better understood the arcane home loans that led to the 2008 financial crisis, and may have been able to avoid problems.

The Council For Economic Education has found that students from states that require financial education courses are more likely to display healthy behaviors like saving, paying off credit cards in full, being less compulsive buyers, and taking reasonable risks. Financial education requirements also have a meaningful impact on students’ lives later on, leading to higher credit scores and fewer delinquencies as young adults, other research shows.

Posted in Youth on November, 2016