Oklahoma is about to coronate one of the most comprehensive statewide school-based financial education programs in the country. Beginning this May, to graduate from high school students must demonstrate an understanding of 14 wide-ranging money management concepts.
The Class of 2014 can rightfully consider itself Guinea pigs. These students were in the seventh grade when the Oklahoma law kicked in, and for the first time mandated that kids learn about money between the grades of seven and 12. It’s up to the schools to decide when and how. Most deal with the subject in a semester or two, and as graduation approaches this year there has been some scrambling to get these lessens completed.
Six years later, though, the Class of 2014 is about to become the first in state history required to earn a “passport to financial literacy.” It seems far-fetched that any student would be denied their diploma on grounds that they did not master basic money concepts. This is a new program. The schools are learning to walk before they run as it relates to imparting money wisdom. They’ve also got their work cut out for them providing qualified instructors. There is no funding in the law to hire dedicated financial literacy teachers.
Still, this is a big moment in a bold initiative and, no doubt, the program will strengthen over time. Just 18 states require so much as a single course in personal finance, according to the Council for Economic Education’s latest Survey of the States. By mandating broad financial education as early as 7th grade, Oklahoma has set itself up as one of the leaders. The 14 areas of testing including budgeting, taxes, banking, investing, loans, insurance, identity theft, retirement planning, mortgages and home buying. Unique to the Oklahoma standards, officials say, are lessens in bankruptcy, charitable giving, and the impact of gambling.
Let’s hope all the kids not only earn their passport, but more importantly retain the key concepts as they start their first job or go to college. High school graduation is a critical money moment in a young person’s life. They likely are staring at staggeringly high college loans or preparing to set up a household and take on myriad new expenses. They could wind up with debts that haunt them for decades. One of the main points of this kind of instruction is to help young adults avoid a rough start—or at least understand what they are getting into.
The bigger goal, of course, is to arm them with the knowledge and confidence to be skeptical consumers and careful guardians of their credit and identity, to ask questions about money transactions until they understand all the terms, and to start now building the nest egg they will need in 40 or 50 years.
Not everyone believes a school program can achieve all this. Hats off to the Oklahomans who believe otherwise. “We’re basically teaching them how to live on their own,” junior high school teacher Joe Griese told The Oklahoman. And isn’t that a big part of what school is all about?