This year’s graduating high school seniors may never again be asked to solve an algebraic equation or write a five-paragraph essay, but at some point they will need to establish credit, seek a car, house or business loan, and be responsible for tax documents.
Money-management skills play a huge role in how students’ lives turn out. Without them, many young adults are vulnerable to debt traps. Warning students against the perils of payday lenders, the consequences of carrying large student loan debt and other ABC’s of financial literacy should be part of a Washington education.
It’s why in 2016 the state folded basic financial competence into K-12 learning standards. Educating the whole child means preparing young people for life’s financial challenges and equipping them “to make sound decisions as students, consumers, workers, entrepreneurs, savers, and investors,” according to a state OSPI fact sheet.
But how — and how fast — these standards get integrated into curriculum has been left up to individual school districts, which is why the results are scattershot.
A pair of school districts in the Tri-Cities area deserve an A-plus for their efforts. Seniors graduating in Pasco and Richland know how to buy a car, establish good credit, balance a budget and prepare for a job interview.
Why? Because in order to earn a diploma, students have to pass a financial literacy class. They leave high school knowing the importance of a good credit score and how a poor one impacts everything from housing options to insurance rates.
Too bad Tacoma Public Schools students can’t say the same.
When asked if this year’s graduates were prepared for their financial futures, TPS spokesman Dan Voelpel said: “We currently are not meeting the standards for teaching financial literacy, however, our Teaching and Learning Department is working on a strategy to incorporate the state standards into existing courses.”
Translation: Good luck, Class of 2019. You’re on your own.
Voelpel points out that school districts don’t have much outside guidance when it comes to reviewing financial literacy standards and integrating them into math, social science and other classes. The Financial Education Public Private Partnership, administratively housed within OSPI, provides multiple teacher trainings, but they’re optional, and the FEPPP reports that in 10 years, only 50 TPS teachers have taken advantage of the resources offered.
Personal financial responsibility is embedded in several high school courses, but because they’re electives, Voelpel says, “most students aren’t exposed to them.”
He says Tacoma has yet to train teachers on the state standards, but officials hope to integrate more money-management skills by the 2020-2021 school year.
Like many area school districts, TPS also partners with Junior Achievement, a financial education nonprofit that sponsors a six-week elementary school curriculum and culminates in a day-long visit to a simulated city in Auburn, called JA BizTown.
It’s a memorable experience for most 5th graders, but hardly a substitute for a formal classroom education for young adults as they get ready to live independently.
The convenient solution is to say it’s a parent’s duty to teach these skills. But the harsh reality is that many dads and moms aren’t fit for the task, as evidenced by the fact that 44 percent of Americans lack the cash to cover a $400 household emergency and 33 percent have saved nothing for retirement.
Washington would do well to go beyond squishy standards and join a handful of states (Alabama, Missouri, Tennessee, Utah and Virginia) that require students to take at least one personal-finance course in high school.
If graduates walk out the door unable to spot predatory lenders and scams and are ignorant of the financial challenges they will face — student debt, budgeting, saving and retirement planning, to name a few — can we really call them educated?