Nearly 25% of U.S. students have access to personal finance education

Math teacher Marina White teaches seniors from Canyon High School in Santa Clarita, California, a lesson on investing and the impact of compound interest rates.

Helen Zhao | CNBC

Millions of high school students across the United States will graduate in 2022 with one important course under their belt: personal finance.

The recent momentum among states requiring high school personal finance education means that nearly 1 in 4 students will take such a course before graduating this year, according to Next Gen Personal Finance’s 2022 State of Financial Education report, which was published Thursday.

This is a big change from 2018, when the first report was issued, and only 16.4% of the high school students in the country had to take a private economics class. Next Gen Personal Finance, a non-profit organization, now feels it is on track to achieve its goal of giving 100% of students guaranteed access to personal finance education by 2030.

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“We’ve really seen some great progress in terms of guaranteed 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 personal economics course before graduating from high school – which Next Gen Personal Finance considers the gold standard – four more states have enacted similar legislation in the last 12 months.

These states – Florida, Nebraska, Ohio and Rhode Island – are in the process of implementing their mandates, which means that in the coming years, more than 32% of students in the United States will have a personal finance class requirement.

“Over the course of five, six years, the proportion of students nationwide with guaranteed access to a private economics class has doubled,” Sherrill said. “We are excited to see that increase in growth.”

Other states also have pending bills that could be passed later in the year, further expanding personal finance education efforts across the country. A measure in Georgia is likely to be the next to become law – both statesmen have approved the legislation and sent it to Gov. Brian Kemp, a Republican, to sign.

“When you start to see Ohio and Florida as states that have already crossed the finish line, it has shown other major states that this is possible,” said Tim Ranzetta, co-founder of Next Gen Personal Finance.

Access in states without mandates

To be sure, there are colleges in states without a mandate for personal finance education that offer such classes.

But local offerings are often unequal, the report found. Overall, 1 in 10 students in a state that does not have a mandate for a personal finance class have access to such a course. In schools where 75% of students are non-white or receive free and reduced lunch, the proportion drops to 1 in 20.

“Many schools that do not feel they have the resources to implement this course end up not doing so,” said Yanely Espinal, director of education outreach at Next Gen Personal Finance.

She added that many of the schools that mostly serve minority students or are in a low-income community are some of the first to see staffing issues and therefore may simply not have enough teachers to offer an extra course.

“If it’s not already a requirement, then that means it’s just so much less likely that they will have the resources in the form of human capital that can then serve every student,” Espinal said.

This factor is one of the reasons why an affiliate of Next Gen Personal Finance, called the NGPF Mission 2030 Fund, is in favor of getting all states to pass legislation that guarantees personal economics education in high school.

Forward

The group also wants a semester-long, independent course in personal finance before the exam to become a national standard.

Currently, nearly half of all U.S. high school students have access to such a course as an elective, but it is not an exam requirement. A further 25% receive an instruction on personal finance embedded in another course.

To cover everything a high school student should know before graduation, an entire semester course is necessary, according to Next Gen Personal Finance.

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