Tennessee May Soon Require Financial Literacy Classes For High School Students

The Tennessee State Board of Education is expected to pass a bill on January 25th that will make Tennesee the eighth state (after Georgia, Idaho, Illinois, Louisiana, Missouri, South Dakota, and Utah) to require that its high school students take a personal finance class before graduation.

Tennessee has “one of the highest numbers of bankruptcy filings in the nation,” and its students scored lower than the national average on a personal finance test (not that the national average—38%—was anything to be proud of):

Scores of Tennessee high schools already offer a personal finance course as an elective. But a 2006 survey by JumpStart Coalition for Personal Financial Literacy shows that only 29.8 percent of Tennessee students who took a personal finance test passed it. The test covered topics from money management to savings and debt. Nationally, 38 percent of students who took the test passed it.

According to the National Council on Economic Education, only one state required any sort of personal finance class to graduate in 1998, six states required it in 2004, and seve in 2007. Is this the beginning of a real shift in teaching personal financial literacy?

“State pushes money literacy” [The Tennessean]

“Report Card – Survey of the States: Economic, Personal Finance, and Entrepreneurship Education in Our Nation’s Schools in 2007” [NCEE]
(Photo: Getty)


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  1. spryte says:

    I think that’s a great idea. In my senior year (’97-’98) I took a Government/Economics class into which personal finance would have fit well. I’d probably be better off now if it had been there…

  2. boandmichele says:

    this would be great, as my high school economics class consisted of ‘TINSTAAFL’, which is the dumbest thing ive ever heard.

  3. F***ing A right. I’ve been pushing for these types of classes for years. Not just Financial Planning either. The kids should have life skills classes — Interviewing, writing resumes, conflict resolution, etc — before they enter college or the adult world.

  4. CumaeanSibyl says:

    Given the average public school’s skill and accuracy at teaching such varied topics as history, biology, and sex education, I don’t think I’d want to trust their financial education to keep a kid out of trouble. It’s too easy for special-interest groups and overly-concerned parents to enforce weird censorship demands on schools.

    I imagine a public-school financial literacy course will not be entirely wrong about any one thing, but will lack key details, solid advice for adverse circumstances, or really anything useful.

  5. econobiker says:

    Rent-to-own furniture (and car rims!), pawn shops, check advances, car title loan, check cashing stores, buy here-pay here bad credit-no problem auto $$$ sales, baby, we have them all here in TN and they advertise as if they are your financial friends.

    Programs like this have been needed ever since the government (state and Federal) rolled over to the business community in regards to usury and credit laws. Only within the last 15-18 years did TN allow alot of the check advance business to happen. In fact the University of TN-Chattanooga (UTC) campus coleseum is named after one slug from Cleveland, TN who made big in check advance/cash advance business.

    Did you ever wonder why Dave Ramsey got his start here of all places and not in a more populated or “higher rent” state?

  6. fizzyg says:

    It’s nice to see this coming around, although just because it wasn’t mandated state-wide before doesn’t mean it wasn’t offered. My southeast GA public school had a 6-week course on basic life skills, with stuff about financial planning, insurance, budgeting, etc. Having them standardized and requiring everyone to take them is a good step forward though, especially with the growing importance of saving for your own retirement. In a lot of the towns similar to my hometown (it was centered around the railroad) parents were just so accustomed to having jobs with pensions that they didn’t know much beyond that.

  7. SpecialEd says:

    The moment this kind of course starts working and affecting bottom lines at banks and CC companies the feds will put a stop to it. But if these classes are taught as well as most other subjects in most schools, our great financial institutions have nothing to worry about.

  8. misstic says:

    I graduated from a high school in TN 20 years ago. We had to take a financial management class then. It was part of the Home Economics course. Males and females had to take it. You were required to completely sew one garment from a pattern, bake a cake, cook a meal, balance a checkbook, and know basic home maint.

  9. Skeptic says:

    This would probably be the most important math class any high school will teach.

    Many kids skip such classes when offered because they want advanced math classes for college applications, but in reality they need this class more. The math you use for everyday and long term financially will be much more important and useful to the average–and even the above average–person than algebra, trig, calculus or statistics. Only by making such a class mandatory will it get the attention and attendance it deserves.

  10. carolea says:

    Funny, I live in Illinois and will be graduating high school this May. I have not taken one finance class and no one has told me I have to either.

  11. youbastid says:

    Does this mean Tennessee will also be offering literacy classes?

  12. youbastid says:

    I kid, I kid the Tennesseeans!

  13. FLConsumer says:

    I would love to see this type of class taught in schools, BUT, fearing what our current political school system would end up turning it into.

  14. Sonnymooks says:

    Based on some of the teachers I’ve had, and some of the teachers I know (not all), I could see this crapping out.

    I had one teacher who believed in all sorts of kooky conspiracy theories, which wound up keeping her in not ideal financial teacher (worse, she was a math teacher).

    There seems to be some kind of bizarre belief that the teachers will automatically be more financial knowledgeable then population at large at work here.

    I don’t see this getting much in the way of results.

  15. newspapersaredead says:

    I think it might help if the parents would sit in on this class with the kids. This is well overdue and should be implemented in every state.

  16. chutch says:

    I agree with Econobiker, we’ve got a butt-load of the trash companies. Here in TN – at least where I live – if one closes, two open.

    TINSTAAFL or TANSTAAFL [en.wikipedia.org] really does apply here as far as I’m concerned. You can’t expect something for free. Someone has to pay eventually.

    Unfortunately, these same companies are great at hiring lobbyists – so even if the they do give loans to people that are extreme risks (and at rates designed to not be a benefit to the consumer), our dollars will be the ones paying the tab. So either way you want to cut it, There Is No Such Thing As A Free Lunch. — as long as you pay taxes that is. :)

  17. goodkitty says:

    This will just end up as a filler/naptime class for most, I think. Economics was the WORST class I ever took… I swear I didn’t think it was possible for people to be ambulatory with the amount of brain power shown in that class. 2+2? What’s that ‘t’ thing between the numbars? It was a required course, which meant nobody, not even the teacher, cared about what went on (or how much work was/wasn’t done) as long as it didn’t include sex or violence (though the former is apparently bendable depending on how much noise you make).

    Still, kudos to Tennessee for trying. I hope the kids have the math capability to learn something from it. School curricula needs to focus more on personal responsibility on all levels, and less on testing. If you’re self-reliant and reasonably intelligent you can learn all the specialized skills/history/math you need on your own. For everyone else, we need more lead paint factories in the U.S., I suppose.

  18. waldy says:

    Geez, lots of cynicism about teachers and schools here on these comments today. As a teacher, I’d like to point out that not all of us suck at our job, thanks very much.

    As with any new education mandate, though, this one needs resources and structure to be effective. No fair just throwing the law at the schools and expecting them to make it happen. Is Tennessee going to hire certified teachers with some kind of credentialing/experience in this field, or is it just going to get handed to somebody who teaches something else and they have to figure it out? Is the state going to provide decent textbooks, the needed supplies, the money for teacher training?

    This could really be awesome if thought through well. Hope Tennessee is committed to making it work!

  19. ElizabethD says:

    Excellent idea. And bring back Home Ec while you’re at it. Seriously.

  20. RocktheDebit says:

    All I know is that my Civics class in Tennessee had a “Real World” unit where we got fake salaries, jobs, apartments, cars, etc, we had to budget for everything (including emergencies) and it made me the cheap bitch I am today. Hurrah!

  21. lovelygirl says:

    I don’t see what’s wrong with this! I just graduated HS and although I am very careful with my money, I know that many of my peers are not and this is definitely a great idea, especially for future college freshmen. If you want to lower the amount of people who are in debt/don’t save, you have to start with the young people. That will make the message go down to future generations.

  22. Jesse in Japan says:

    Where can I take this personal finance test?

  23. Haha so I read that headline as “Tennessee May Soon Require Literacy Classes For High School Students”. I was thinking to myself “well, I’ve met a few people from Tennessee, and maybe that isn’t such a bad idea.”

    I then read the headline again and figured out that financial was in there, and my first thought was “Well WTF good is that going to do if they can’t read?”

    It may not amuse you guys, but I almost fell out of my chair laughing.

  24. SpecialEd says:

    @waldy: I realize that there are a lot of good teachers out there, but:

    1. the education system is very bad in many places in spite of good teachers and

    2. Many place will not hire a teacher certified to teach the course. They will have a coach take a few classes (at best) and stick them in there to do as they will.

    3. Banks, credit card companies, and financial institutions depend on soaking the ignorant. They will only put up with a token mount of education in this area before lobbyists step in and mess it up.

  25. nffcnnr says:

    @SpiderJerusalem: i took a similar class in 8th Grade called “Career Prep.” i still remember – and use – the skills Mrs. Zimmerman taught us in 1985: How to correctly write a check and balance a checkbook; how to fill out a job application; interview do’s and don’ts; basic budgeting; smart shopping, etc. A required class like this can only be good for the youngsters. But why wait until High School?

  26. falc says:

    i think this is a great idea. it’s sure as hell a lot better than having to learn on your own or through your parents. in my case the only lesson i learned from my father as far as finances goes is that if you Discover Card is late you can pay it at a local Sears and it’ll be billed the same day… needless to say i had a lot of learn.

  27. Adam Hyland says:

    First off, it’s TANSTAAFL, it sounds better with the “ain’t” in there.

    Second off, I’m an economics student, and I think that the last thing in my mind that I would like to see anyone take as a required course in high school is introductory economics. this course isn’t that, it is a financial planning course, but if it has course requirements set by the state, you can be sure students will be expected to:

    -explain the relationship between bond prices and interest rates.

    -Understand the simple money multiplier.

    -For some unknowable reason, sketch the production possibilities curve.

    to anyone who teaches or feels they understand personal finance, NONE of those are necessary to know or even care about in order to discharge your finances properly. However, they will find their way into the state mandated curriculum.

    @ the people defending teachers: fine. We understand that plenty of teachers work hard and do good things. My mom was a teacher. I still know and respect plenty of my teachers–hell, I even invited one to my wedding. We aren’t lashing out at you in particular. We are lashing out at the capability of the state to properly teach something that is best taught by example.

    To wit:

    If you learn in personal finance that budgeting and transparent financial practice are a good thing but when you get home your dad asks you to keep the toolset he bought yesterday a secret from mom, you will learn that hiding purchases is the right way to handle finances.

    If you learn that compound interest makes the power of savings phenomenal, but your parents cash their paychecks every tuesday, then you will learn that spending today is more important than spending tomorrow (ok, fine, that’s what the discount factor means)

    The list goes on. And it is depressing.

  28. ancientsociety says:

    Great idea!

    I graduated high school in IL in 98 and took a “Consumer Math” class. Honestly, I really enjoyed it and I HATED math in school (plus I could never wonder “when will I ever actually USE this!?”)

  29. CyberSkull says:

    Great idea! I am of the opinion that math classes should be re-organized around practical matters. Finance is a good way to get algebra into their heads.

  30. LoLoAGoGo says:

    Honestly, I wish they taught me that in both HS and College. A personal finance/ life skills course would benefit everyone who wants to learn it.

  31. thalia says:

    I wish they had taught this at my high school. Seriously, they NEED to be teaching courses in hs about how to balance your checkbook, keep control of your finances, save money, do your taxes, what loans entail, etc. Basic Financial Knowledge 101.

  32. jawacg says:

    I am glad they finally decided to try to do something like this, but I am not waiting around. I am planning on trying to educate my kids on all the dirty tricks and giving them some knowledge on how the financial world works. Cause I could have certainly used it and I don’t want them making my mistakes.