If you took a personal finance class in high school, you are one of the lucky ones. Understanding the elements of personal finance at an early age establishes a foundation for people to be more successful as adults. As a group of community leaders and financial service professionals, we see the benefits of exposure to personal finance or the detriments when it’s lacking nearly every day.
Today, Minnesota high school students don’t have an equal opportunity to learn personal finance skills. It’s hard to imagine how the next generation will make sound financial decisions in an increasingly complex world without a solid understanding of budgeting, investing, and managing their money.
The amount of personal finance instruction differs for each school district, and there is a great disparity in finance curriculums across the state. Few districts teach personal finance as a stand-alone subject, and others don’t offer it at all. Some districts integrate this subject within another course, such as Business, Math, Social Studies, or Family and Consumer Sciences. And many districts offer personal finance as an elective course. This unequal access to financial education means many students are not learning how to build good financial habits that create a stable future.
The Financial Literacy Coalition of Minnesota, in conjunction with the Minnesota Council on Economic Education, is working to change this. In the current legislative session, a bill is being introduced by Rep. Hodan Hassan and Sen. Steve Cwodzinski to require a semester-equivalent personal finance course for high school graduation in Minnesota. This legislation will give ALL students an equal opportunity to become financially literate regardless of their school district. Providing a semester-long course will allow teachers to offer a comprehensive study of personal finance.
In addition to understanding the basics of budgeting, saving, and investing, students will learn how to make informed choices about taxes, car loans, mortgages, and retirement planning.
Currently, 17 states have already passed legislation requiring a semester-equivalent course for high school graduation, with more states engaged in legislative efforts to pass similar requirements. Previous attempts to pass this legislation in our state have been unsuccessful, largely due to a lack of organized support. We are working to change that by gathering a group of dedicated Minnesotans advocating on behalf of this bill.
Passing the bill is the first step. Implementing the bill successfully will take time and money to establish curriculum and train educators. The work today could provide substantial long-term dividends in the future. How might our communities benefit when we accomplish this goal? Imagine the following possibilities:
— Personal finance education promotes decision-making. This essential life skill teaches critical thinking, preparing students to become contributing members of society.
— A well-educated population will continue to attract business to our state, leading to more revenue and a higher standard of living.
— As access to financial literacy education becomes more equitable, the wealth gap will decrease.
— State government will spend less on public assistance programs as financially educated citizens have the skills to achieve financial stability.
— As state residents increase their incomes, tax revenues will also increase. This additional revenue will afford politicians new opportunities to lower taxes or invest in a better standard of living.
— Making meaningful investments in the next generation will enhance the reputation of our state government.
— We will be a more joyful society when people have financial stability.
Successfully implementing the bill will enhance collaboration among legislators, educators, educational administrators, the Department of Education, the financial service community, students, and parents. They will work together to ensure that Minnesota ranks in the nation’s top five financially literate states.
Those involved in passing and implementing this legislation can take pride in helping to build a better financial future for the next generation.
To make this vision a reality, the time to act is now. According to a Public Policy Polling report in April 2022, 86% of Minnesotans want this graduation requirement to be a legislative priority.
We are intent on getting a personal finance requirement in schools so that all Minnesota students have an opportunity to be best positioned to make effective financial decisions as they pursue higher education, enter the workforce, and give back to their communities.
Jason Kley (jasonkley@flcmhub.com) and Steve Lear (stevelear@flcmhub.com) are financial advisors and co-chairs of the Financial Literacy Coalition of Minnesota.
