Math has always been taught in school, but the kind of math you’re probably thinking of isn’t always practical. You’ll never need to use de Moivre’s Theorem to file your taxes, and you’ll never have to work with the polar representation of a complex number at the grocery store. Unless kids are brought up in a household that practices and teaches them smart money management, they’re going to have a rough time in the real world where they will make a hundred financial decisions every day.
In the wake of a worldwide economic crisis and in an effort to better equip students for life in a financially uncertain and constantly changing world, in 2009, the New Jersey Department of Education adopted curriculum standard 9.2, a half-year course in personal finance or entrepreneurship required to graduate from high school. New Jersey residents are fortunate, as our state Department of Education is one of just 17 across the nation that has implemented financial literacy standards in schools. Standard 9.2 helps students obtain the skills necessary for responsible financial practices and is intended to build more financially-capable young adults as they enter college and the workforce.
What percentage of their monthly budget should go to rent? How much money must they earn in order to avoid sharing a two-bedroom apartment with five other people? What should be claimed on their W-4 form? For kids who’ve never faced greater financial responsibility than paying for their own phone apps, these questions are great mysteries – but shouldn’t be. Several school subjects have little practical application for “life on the outside,” and in order to prepare our students for a world that reinvents itself entirely every ten years, our education system needs to focus on information that is both applicable to students in the long-term and lays a groundwork for their future growth, development, and stability. The implementation of curriculum standard 9.2 has been a positive step toward giving students an understanding of information that will help them succeed, but more needs to be done.
Economic education and financial literacy go well beyond managing one’s credit card debt or saving for retirement. Personal finance illuminates all facets of society, whether in the marketplace, the workforce, the voting booth, or at home. Life is about the choices we make. Helping students to build the framework for good financial decision-making and teaching them how this affects the world around them will, in turn, cultivate a prosperous society full of financially-responsible individuals.
While the personal finance and entrepreneurship curriculum is implemented through different methods in each school district, the teachers, students, and parents agree the program has helped to better prepare students for the next stage of their lives. A recent study of 65,000 first-year college students, conducted by EverFi and Higher One, found students required to take a financial literacy course in high school are significantly more likely to be financially-responsible than their peers. Students who took a class scored better on the survey’s financial knowledge questions and were found to be more averse to debt, more likely to pay credit card bills on time, and less likely to exceed their credit limit. The study is the first comprehensive analysis of the impact of high school financial literacy education on not only knowledge but attitudes and behaviors.
New Jersey, while not the first state to add personal finance to the required curriculum, is proud to be ahead of the national curve. Are there ways for New Jersey to further financial education? Absolutely.
The Mercadien Foundation, after meeting with educators and administrators, is launching Money$peak this fall in partnership with Rider University, educators, and educational organizations. Using existing talents and learned financial skills and information, student teams will compete for awards and bragging rights, helping to further their financial understanding and bringing added gravitas to an under recognized area of study. For financial education and stability to become fully integrated into our communities, it will take more than half a year in class; it will take community partners joining together and the community investing in this most important lifelong skill.
If you are interested in the Money$peak program, would like to support it, or need more information, please visit us here.