The Personal Finance course may be a requirement for high school in California

In summary

A ballot initiative that would require a personal finance course in high school bypasses the usual process for curriculum changes.

Normally the curriculum is the responsibility of education experts, but this fall California voters could decide whether to introduce a new requirement for high school students: a one-semester course on personal finance.

The California Secretary of State is close to confirming that the California Personal Finance Act will be eligible for the November ballot, which would add financial literacy to the list of high school graduation requirements beginning with the Class of 2030.

Students would learn about paying for college, online banking, taxes, budgeting, loans, retirement accounts, loans, how the stock market works, and other topics. The issue is critical, organizers said, as students face a changing economy and difficult decisions about college, their careers and their future.

“No one comes out of the womb knowing how to manage their credit. It needs to be taught,” said Tim Ranzetta, co-founder of a personal finance education nonprofit and a key supporter of the initiative. “And right now there is a dramatic gap between what students know and what they need to know. We have to change that.”

Voters seem to agree with him. A 2022 national survey of adults found that nearly 90% support a financial literacy requirement in high school, and nearly as many wish they had taken such a course as high school students.

This is not surprising considering the financial problems that many people face. The average credit card debt in California is $8,366, the sixth-highest interest rate in the country, and one in six borrowers nationwide are in default on their student loans.

Financial education in the classroom

But some education experts have pushed back, not because they oppose teaching financial literacy to students, but because they question whether voters are best placed to dictate what is taught in classrooms.

Currently, the state's history-social studies framework includes a semester-long course in economics required for graduation that covers much of the same material proposed by proponents of the financial literacy ballot initiative. Financial literacy is also included in the first, second and ninth grade curriculum. For example, first graders learn that money can be exchanged for goods and services, and people decide for themselves how to spend their money.

But Ranzetta said the curriculum, which was last updated in 2017, does not focus enough on financial literacy. Personal finance is only covered for a few weeks in the business course; The rest includes more abstract economic concepts such as international trade, resource allocation, and the advantages and disadvantages of capitalism. Individual teachers can choose how much they want to focus on specific topics.

State Commissioner Tony Thurmond did not answer questions about the ballot initiative, although he supported it. Linda Darling-Hammond, president of the State Board of Education, also did not answer questions.

Leaving curriculum decisions to voters is “a bad idea”

There has been almost no opposition to the proposed ballot initiative so far, but some are questioning the idea of ​​letting voters — rather than education experts — decide what students learn in the classroom. Typically, curriculum in California is developed by a group of teachers and subject matter experts who serve on the Instructional Quality Commission, which meets publicly six times a year. The new curriculum is subject to multiple reviews, modifications and public review and will ultimately be submitted to the State Board of Education for adoption. Local school authorities can adapt the curriculum to the needs of their students.

“Most voters don’t know much about education policy, and letting them decide what can be taught in schools is a bad idea,” said Morgan Polikoff, an education professor at the University of Southern California. “We already have a process in place for adopting curricula, and if people are unhappy with it, there are lots of ways to make their voice heard – they can go to meetings, they can vote people out, they can talk to their representatives.”

“No one comes out of the womb knowing how to manage their credit. It needs to be taught.”

Tim Ranzetta, co-founder of Next Generation Personal Finance

Polikoff worries that introducing curriculum through ballot initiatives could set a dangerous precedent. For example, religious or anti-LGBTQ curricula could be approved by voters, leading to costly and lengthy legal battles with the state Department of Education.

The curriculum can also be complicated. When creating new curricula, the Teaching Quality Commission takes into account the wider context and ensures that students receive new material each year that builds on what they have previously learned, that subjects do not overlap and that topics are flexible enough to so that teachers can adapt lessons to the individual needs of their students. Textbooks and tests are also taken into account.

The legislature participates

Most curriculum updates and changes come from the commission, but sometimes the legislature gets involved. For example, the state's new requirements for ethnic studies and media literacy were based on draft legislation in Parliament. Another bill, AB 2097, would add computer science as a degree requirement.

AB 2927, a financial literacy bill proposed by Democrat Kevin McCarty of Sacramento, would actually do much of the same thing as the ballot initiative. The bill imposes financial literacy as a graduation requirement, although it would take effect by 2031, a year later than the ballot measure.

Bruce Fuller, an education professor at UC Berkeley, said he is concerned about the increasing politicization of the curriculum — whether by the Legislature or by those pushing ballot initiatives.

“These political interests blatantly seek to control what is taught in the classroom rather than leaving it up to teachers and locally elected school boards,” Fuller said. “We should trust these people to develop a thoughtful curriculum that works for their students.”

He also questioned the ever-growing list of graduation requirements. High schools offer only six or seven classes per day, and because there are more compulsory subjects, there is less room for art and other electives. Some districts have begun implementing additional time to allow students to take all the courses they need to graduate, complete a career and qualify for California's public universities.

“We are dealing with these political interests that are blatantly trying to control what is taught in the classroom rather than leaving it up to teachers and locally elected school boards.”

Bruce Fuller, professor of education at UC Berkeley

“I’m not sure how adding more required courses will motivate troubled teenagers,” Fuller said. “With more requirements, we give them almost no chance to study things that really interest them.”

McCarty's bill isn't the Legislature's first attempt at financial literacy. A dozen bills requiring financial literacy have been voted down or defeated in recent years, in most cases because financial literacy curricula already exist and the state already has a system in place to implement curricula.

As Gov. Jerry Brown wrote in 2018 when he vetoed a bill that would have provided financial literacy materials to teachers, “This bill is unnecessary.” The History-Social Science Framework already includes financial literacy content for students in kindergarten through 12th grade . class and an elective on financial literacy.”

“I recognize the value of the process, but it is slow and has not worked in California so far. The issue is too urgent and too popular to wait any longer.”

Tim Ranzetta, co-founder of Next Generation Personal Finance

Ranzetta said the Legislature's inability to pass a financial literacy curriculum led him to take the issue directly to voters.

“I recognize the value of the process, but it is slow and has not worked in California so far,” he said. “The issue is too urgent and too popular to wait any longer.”

Ranzetta grew up in New Jersey, where his father was a banker and his mother worked as a community volunteer, and raised six children. He learned financial literacy from his parents and assumed that other young people did the same. It wasn't until he started volunteering at a high school in East Palo Alto that he realized that many students don't know anything about money and that ignorance can hinder them throughout their lives. But they were eager to learn, he said, and to share the information with their parents.

This experience inspired him to start NextGen Personal Finance, which offers free curriculum and financial literacy training for teachers. At least 7,000 teachers in California and more than 100,000 nationwide took part, he said.

A class that demystifies money

The main entrance to Berkeley High School in Berkeley on May 1, 2024. Photo by Laure Andrillon for CalMatters

At Berkeley High, Crystal Rigley Janis teaches two business courses and three personal finance courses, covering topics she wished she had known as a young person: how to negotiate a salary, not relying on gut instinct when investing, and eschewing individual stocks in favor of index funds .

“It took me 15 years to understand these things, and it probably cost me millions of dollars,” said Rigley, who worked at a wealth management firm for several years before going into teaching. “I don’t want other people to make the mistakes I made.”

Eliza Maier, a senior, was so impressed by Rigley's course that she opened a Roth IRA at 18 and transferred money from her low-interest savings account. She said the course helped demystify money and the role it can play in important life decisions.

“We learned that money isn’t good or bad – it’s a tool,” Maier said. “It can help you achieve your goals. It can help you be prepared for whatever happens in your life. I didn’t know anything about money when I started taking this class, but I think it’s so important, especially for high school students.”

Anna Harden

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