By: Hadley Malcolm
November 14, 2013
The students in Lisa Bender's Introduction to Financial Management class at Southern Garrett High School all seem to be saving for the same thing: a car. And for 25 teens ages 15 to 17, what could be a more important financial goal?
Mikhaila Missimer, a 15-year-old sophomore, is saving for a car. So is sophomore Camden Nichols, also 15, who hopes to save enough from his convenience store job by next year.
Both students cite Bender's class for helping them attempt to turn their goals into a reality. Her students learn to set "SMART goals," goals that are "specific, measurable, attainable, relevant and time-bound."
Too often, teens have generic savings goals and no plan to achieve them, Bender says. The SMART goal curriculum teaches them to set realistic goals with incremental savings targets to stay on track. It's an important lesson in learning to take control of one's finances, Bender says, a lesson catching on across the country.
While the Great Recession put many Americans through a financial wringer, it has left at least one positive legacy: a renewed focus on financial literacy education that has united teachers, school districts and businesses in a commitment to curriculum, training and resources.
Financial literacy education advocates interviewed by USA TODAY all mentioned the financial crisis as the pocket-emptying influence behind the country's increased attention on personal finance lessons in school.
"The American public felt they were a little bit in the dark and really didn't understand the decisions they were making or not making," says Nan Morrison, president of the Council for Economic Education, whose biennial Survey of the States measures financial literacy education across the country. "The recession really put a fine point on that."
Educators decided to try to do something to prepare the next generation of America's earners.
"We look at things like this and translate them into education practice," says Lynne Gilli, program manager for career and tech education instruction and head of financial literacy education for the Maryland State Department of Education.
Bender's course curriculum -- which includes SMART goal-setting and covers topics including saving and investing, fraud and identity theft, and weighing careers against earnings -- is now part of a requirement for students at Garrett County's two high schools. The class of 2013 was the first to graduate under the mandate, which was implemented in 2009, when those students entered Southern Garrett and Northern Garrett high schools as freshmen.
While Maryland doesn't require a course at the state level, surveys show more states are. As CEE prepares to release its 2014 survey, preliminary findings show Alabama, Florida, Texas and Arizona have added a personal finance class as a graduation requirement since its last survey in 2011. That brings the number of states requiring a course to 17.
Many more states, including Maryland, have adopted personal finance standards as part of overall curriculum requirements. Three more added personal finance to state standards of education since 2011, bringing the total to 39.
The timing of such an effort may prove crucial, as Americans get failing grades across surveys and studies about financial literacy in the U.S.
The 2012 National Financial Capability Study, by FINRA Investor Education Foundation and developed by federal agencies, including the Treasury Department and the President's Advisory Council on Financial Capability, shows that when asked five questions on economics and financial concepts such as compound interest, 61% of adults are unable to answer more than three questions correctly. In a similar assessment of high school students, the average score last year was 69%.
Despite efforts to improve these statistics, some education professionals say it's not enough to offer a sole course in high school, or only require standards. Even states that require both standards and a course may not be doing so effectively, says Mary Blanusa, vice president of government affairs for CEE and project leader for the Survey of the States. Implementation varies from state to state, she says. States can be technically counted as requiring a personal finance course by CEE's survey even if they incorporate a personal finance unit into another class.
Blanusa and Morrison point to one system as exemplary. Chicago Public Schools is developing a financial literacy framework to help teachers implement age-appropriate lessons and units that tie into each other as students' progress from kindergarten through high school. The attention on financial literacy now aims to support teachers with professional development and give students a more seamless experience. "They have really looked at the subject area holistically from K-12," Blanusa says. "No one else is really doing that in a very specific, planned-out way."
A lack of resources keeps many states from adopting a new curriculum. Adding course requirements at the state level usually means hiring more staff and investing in textbooks, says Garrett County Schools Superintendent Janet Wilson.
Stepping in to provide funding are banks and private businesses, pledging millions toward financial education. Discover's Pathway to Financial Success grant program will donate $10 million over five years to high schools to start or expand financial curriculum. PwC, the U.S. branch of PricewaterhouseCoopers, is launching its Earn Your Future campaign last year with a $60 million pledge, plus $100 million worth of volunteer hours, to youth financial education.
Bender is a recipient of the grant program. Garrett County got $41,000 which it used largely to buy iPads that students use in class. Bender, who has been teaching business for 27 years, was the school's biggest advocate for requiring financial literacy education. She was inspired by the impact of a stock market unit she taught in her economics class each year. "It was making a difference to those 20 kids but there were 800 more kids in my school," she says. "What if we could reach all of them?"
Now she does. While they may not be thinking about how to take out a mortgage or get a credit card yet, they're leaving her class with an understanding of the pertinence of their financial literacy.
"Everything in here is real-life applicable," junior Ben Reichard says of the class. "At first I was like, man, another requirement. But in the end, it was definitely worth it."