Kids and Money: The No. 1 Reason They Don't Learn at School

Financial education, especially as it relates to kids learning about money, has on the surface made big strides in recent years. The most recent Survey of the States report from the Council for Economic Education found that:
  • More states are on board The number of states requiring an economics course to graduate high school has increased to 21 from 17 since the last survey in 2007.
  • Personal finance is a focal point The number of states requiring a personal finance course to graduate high school stands at 13, up from seven; 34 states have personal finance content standards, up from 28.
  • Business skills are on the radar Five states require that entrepreneurship be taught as part of a high school course (usually economics), up from three in 2007.
That's the good news. The bad news is that no matter how much we require schools to teach kids about money it doesn't seem to work. Student financial literacy test scores haven't improved in a decade, according to the JumpStart Coalition for Personal Financial Literacy.

With little measurable progress, the Obama administration is shifting gears. The new approach is to keep things very simple for students and provide few but thoroughly vetted choices in financial products for adults.

But the real issue may have less to do with kids' ability to absorb money lessons than with educators' ability to convey them. In a 2009 survey, Wendy Way and Karen Holden, Human Ecology experts at University of Wisconsin, found that "while teachers recognize the importance of teaching personal finance, few have had formal preparation for teaching this subject matter." Indeed, just 37% of teachers have taken even a single personal finance course while in college. Nearly as many now teach one in high school. Wow.

Other findings:

  • Less than 30% of teachers offer their students any instruction in personal finance.
  • Only 19% of teachers had attended a personal finance workshop for their own benefit and a meager 12% had attended a workshop on how to teach personal finance.
  • The chief financial concern of teachers is their own money, including saving for retirement, paying their kids' college tuition and finding supplemental income.
The upshot: the vast majority of teachers did not enter the profession because they love or have any affinity for finance; they aren't particularly good with money, and they have little interest in learning how to teach about it. No matter what the states mandate, teachers are not going to educate your kids about money to any meaningful degree. You'll have to do it at home.

If you have a question about kids and money, I'll find the answer. Email

Photo courtesy Flickr user seeveeaar.