Given a C in 2017, Kentucky maintains this grade in the updated 2023 National Report Card on State Efforts to Improve Financial Literacy in High Schools, issued by The Center for Financial Literacy at Champlain College in Burlington, Vt.
States with C grades have personal finance education standards, but implementation is left up to local school districts, with no state oversight.
Grade B states are required to offer personal finance education, but permit school districts to decide whether to offer a standalone course or embed the subject in another course. Grade A states clearly mandate a standalone, semester-long personal finance course, or its equivalent.
John Pelletier, director of the Center for Financial Literacy, says that by 2028, 23 states are projected to have an A grade. This means that nationally, the 1.7 million students attending high schools in grade A states in 2023 are expected to increase to 6.4 million students in five years.
“Kentucky requires high school students to take vocational instruction, which includes personal finance concepts,” says Pelletier. “The Class of 2024 will be required to take one or more courses or programs with financial literacy content, but implementation will be up to school districts.”
Pelletier says state policy makers are responding to families without financial safety nets during the pandemic, as well as to advocacy by educators, administrators, parents and students. He also notes that there is a recognition that personal finance knowledge and skills are crucial in today’s complex financial world, and cites the expanding availability of free online curricular resources offered by state departments of education and by non-profit organizations.
A 2022 poll by the National Endowment for Financial Education (NEFE) indicated that 88% percent of adults wanted their states to require a semester, or year-long financial education course for graduation from high school, and 8 in 10 adults wished they were required to take such a class when they went to school.
As momentum for personal finance education grows, teacher training will become more important. The Center projects that 30,000 highly trained personal finance educators in just the grade A and B states will be needed by 2028.
The 2023 Report Card includes a review of the racial and ethnic disparities in financial capability drawn from the most recent FINRA National Financial Capability Study written by researchers at the FINRA Investor Education Foundation (Angela Fontes, Hanna Gilmore, Gary Mottola and Olivia Valdes), as well as research by Dr. Carly Urban of Montana State University highlighting the benefits of requiring financial literacy education in high school.
“Financial literacy is linked to positive outcomes, like wealth accumulation, stock market participation and effective retirement planning, and avoiding high-cost alternative financial services,” says Pelletier. “Conversely, poor financial literacy and negative financial behaviors often go hand in hand.”
“High school personal finance education can help alleviate the cycle of poverty that exists in our nation,” says Pelletier. “Requiring all students to take a standalone financial literacy course, regardless of their race, ethnicity or economic status, is an important step our nation can take toward reducing inequality.”
An interactive national map with information on the 50 states and the District of Columbia and a downloadable copy of the full National Report Card is available here: 2023 National Report Card. A fact sheet on Kentucky can be found here.
To produce the Report Card, the Center again conducted detailed reviews of high school graduation requirements, state academic standards for personal finance education, and laws, regulations and guidelines that relate to how each state delivers personal finance education in its public high schools.
Champlain College’s Center for Financial Literacy is known for its work to increase the financial capability of our nation through its research, advocacy and financial literacy educator training programs.