Mandatory financial literacy in high schools is long overdue, experts say

Lina Foley wants to see some of her colleagues improve their personal finances.

“Honestly, I don’t think this generation has enough knowledge about how to handle their finances,” said Foley, 21, a Leechburg resident and senior at Seton Hill University. Ta.

Numerous studies on the subject show that this is bad for young people and for society in general.

A 2014 National Institutes of Health report examined multiple peer-reviewed studies on youth debt and showed that debt rates are correlated with juvenile crime rates.

A summary of the study found that about half of adolescents are in debt and 25% report having “financial problems.” The study also found that serious and/or habitual juvenile offenders were more likely to report financial problems than juveniles with no debt.

A Forbes Advisors study last year found an alarming link between debt and mental health problems.

Among the results of a Forbes survey of people who reported financial problems, 60% of respondents reported that their problems caused friction in their relationships with others.

54% say they feel stressed often or always

66% say they are considering filing for bankruptcy

48% reported sleep problems

38% report experiencing a decline in their social life

34% reported depression

However, learning how to manage debt, budget, and invest to avoid financial problems is often not required in high school.

That will change within a few years.

In December, Pennsylvania became the 25th state to pass Senate Bill 843, a bill that would require high school students to complete a semester-long course in financial literacy in the 2026-2027 school year.

Currently, there are no personal finance courses or high school graduation standard requirements in Pennsylvania.

Pennsylvania Comptroller General Timothy L. DeFoor toured several high schools across the country in 2023, including Ligonier Valley High School, to see first-hand how they teach financial literacy to students.

“We have a generation that needs to understand debt, know how to preserve wealth, and learn how to spend money wisely,” DeFoor said in a press release. “Having access to financial literacy curriculum in high schools expands the playing field for all Pennsylvanians.”

While attending Leechburg Regional High School, Foley chose personal finance as an elective and chose from three finance-related courses: Democratic Principal, Personal Finance, and Consumer Mathematics.

“I felt it was important to have some knowledge of how finance works. I had gone to university so knowing how to save and how to budget for certain things was important. It was important,” she said.

A leader in financial literacy

Hempfield Regional High School pioneered the financial path in Westmoreland County, offering financial literacy to students in 2017 and requiring students to complete a half-credit finance course.

“We were the first in the area and one of the few high schools in the state to make it a graduation requirement,” said John Howell, Hempfield teacher and business dean.

Howell called the findings on financial literacy, or lack thereof, in America “astounding.”

He noted that 76% of Americans live paycheck to paycheck. 50% of working Americans have less than $2,000 saved for retirement. And by 2023, more than 50% of Americans will have no money saved at all.

“While these numbers were shocking, what was equally shocking was that no one was teaching financial literacy to young people at any level of education,” Howell said.

Christina Serafini | Trilive

Junior Caitlin Bigelow works through an exercise in Dora Morelli’s financial literacy class on Jan. 25 at Hempfield Regional High School.

In his interactions with students, Howell said many students have little knowledge about credit scores, credit history, how credit scores are constructed, and what can negatively impact credit scores.

“This is one of the biggest drawbacks for students, as well as the way they invest their money,” Howell said.

Topics covered in high school financial literacy courses include buying a car, renting, insuring, buying a home, diversification, investing for retirement, online banking, getting a credit card, fixing your credit, paying taxes, and checking. Includes account selection and balances, budgeting, and more. and savings and risk versus return.

Hempfield officials initially offered a finance course to freshmen, but found that students at that age were not ready to understand or appreciate the importance of the course.

“We took it to the 11th grade level, and that was a game changer,” Howell said. “At that age, many of our students are starting to think about buying a car, renting their own apartment, going to university or vocational school, or getting a job, so what we teach them They have a greater interest in and appreciation for, where they take personal responsibility for the financial choices they make.”

Howell teaches several finance-based sections, including a 16-week stock market project.

Students will be exposed to various features of the stock market and learn how to read stock reports and create a diversified stock portfolio.

The investment simulation includes showing students the difference between starting investing at age 25 and starting at age 40, based on a retirement age of 65.

“It’s literally amazing for them. Time is your best friend when it comes to investing and we really emphasize why you need to start sooner rather than later,” Howell said. .

At Riverview Junior and Senior High School in Oakmont, fourth-grader Gwyneth Fichte is learning how to become more financially responsible.

“Personally, I’m struggling financially because I don’t get much guidance from my parents,” Fichte said. “I’m very reckless with money, so I’m trying to learn money management skills.”

Fichte said her course at Riverview began with a lesson on wants, needs and values ​​taught by teacher Patsy Kvortek.

Mr. Kvortek advocated for requiring personal finance at Riverview, which began requiring students to take the yearlong course in 2015.

“I think that was the biggest thing we learned: It’s good to really ask yourself, is this something you want or is this something you need?” Fichte said.

Louis Rüdiger | Trilive

Riverview High School teacher Patsy Kvortek went through the process of creating a personal spending plan with her upperclassmen in a recent class.

Nationally, 87% of teens own an iPhone and expect their next cell phone to be an iPhone, and 72% of teens own Airpods.

According to the Bureau of Labor Statistics, about 39% of teens work part-time.

Gene Natali, CEO and co-founder of financial planning and education company Troutwood, author of the award-winning financial book for teens and college students, The Missing Semester, and Certified Financial Advisor. He said the new mandate for public high schools is “huge.” ”

“Passing the personal finance (requirements) will immediately benefit the students. The second beneficiaries will be their parents, as the students apply what they have learned to improve their financial lives. There will be a huge impact on the local community,” Natali said.

Natali from McCandless has given over 1,000 personal finance presentations to high school and college students across the United States.

“Budgets and the stock market are top concerns for high school students, and one of the reasons for that is that technology investments have made it possible to invest in small amounts,” Natali said.

Natali pointed out that pensions in the past were just like that, with only about 1% of today’s teens eligible for a pension.

“We had pension funds and cash purchases, and now we have apps and influencers,” Natali said.

He said that what we see and observe as children influences us in terms of financial literacy.

Natali has been teaching a 1-credit elective personal finance course at the University of Pittsburgh since 2015.

“Students have to do what pensions once did for them,” Natali said. “The biggest challenge in personal finance is to replace what pensions have been doing. Otherwise, these kids will be working until they’re 100.”

Natali strives to provide information and resources to educators to help high school students better understand and appreciate their finances.

“He has been a huge advocate for making financial literacy a graduation requirement in Pennsylvania,” Howell said.

Student spending sparks interest

Cohen Houlahan, a senior at Riverview College in Oakmont, said it’s a good thing Riverview College students are required to study personal finance before graduation.

“Actually, I was interested in finance before I took the class, but it’s better to take it as an upperclassman because I can remember more things.It’s about learning about adult life.In my case, It doesn’t really cost that much money. You don’t need that many things,” Hoolahan said. “This course is not boring because it will help you in the future.”

Fichte has opened a bank account and works part-time teaching flute lessons.

“A lot of people are like, ‘Hmm,’ about taking it, but I think it’s a very useful course and I think a lot of people should take it,” Fichte said. .

Personal finance courses are held sporadically across school districts in this region.

The Fox Chapel Area School District offers an online-only Personal Finance elective course.

Highlands High School in Harrison is offering an optional semester course in personal finance that will be required for incoming freshmen in 2025.

Kiski Regional High School requires new students to take a personal finance course.

Leechburg senior Owen Nuttall took a personal finance course taught by Leechburg District teacher Jill Shipman during his sophomore year.

Nuttall said learning about budgeting is the foundation of personal finance.

“I learned how important it is to budget, manage money, write checks, and go to the bank. And I’m doing my own personal banking,” Nuttall said. “I would say it’s about 50-50 among teenagers who know how to manage their money.”

Nuttall said she has become more financially confident as she approaches graduation.

“It’s great and you learn more about money once you graduate from high school,” said Nuttall, who has her own savings and checking account.

“I think by teaching kids early on, they can learn the importance of saving and knowing their true financial situation. I think it should be compulsory, like math class. ” Foley said.

“It’s really important. This course prepares you for your real future. And the other classes are also important, putting you on the path to a career. But this course is important for adults. It will help you in everything you do after that,” Houlahan said.

Leechburg senior Giavonna Spagnola of West Leechburg is enrolled in her second personal finance elective course.

She took Consumer Mathematics as a student and is currently taking Democratic Principles.

“I learned about insurance and calculated health insurance, car insurance and interest rates,” Spagnola said. “I had to analyze interest rates for buying cars and houses, and I wanted to take it because it was a math unit and it taught me real-life things that I thought I needed.”

Howell said parents sometimes approach Hempfield District staff to express their gratitude for teaching the course.

“They say they see their children taking a more conservative approach to spending. Statistics prove that the current generation truly lacks understanding and importance of how money is spent. and we need to do something about it,” Howell said of the newly passed bill. “This is a huge step in the right direction to help our nation’s youth learn the importance of financial choices now and in the future. Financial literacy is truly a lifelong skill, and we are committed to meeting this need of our students. We are very proud to have been able to respond ahead of time.”

Joyce Hunts | Trilive

Leechburg area finance students (from left) Owen Nuttall, Giavonna Spagnola, Callie Ankosky and Alyssa Foley talk about what they’re learning in class.