Teens Need Financial Literacy Too

After the market crashed in 2008, the Program of International Student Assessment (PISA) took it upon themselves to test and teach the worlds youth financial literacy. The test was conducted in over 18 countries and roughly obtained data from thirty thousand 15 year-olds according to The Huffington Post. As for America, they ranked about dead center in terms of results. On average, American students answered 492/700 questions correct.

Jim Stigman Financial Literacy in TeensRoughly, one in every ten American scored in the ‘top performance’ tier. The report released by the Organization for Economic Cooperation and Development (OECD) concluded in their report, “they (American students) can look ahead to solve financial problems or make the kinds of financial decisions that will be only relevant to them in the future.” Even though American students did rank fairly average compared to the rest of the world, almost 20% of the students did not reach the ‘baseline level of proficiency in financial literacy.’ Surprisingly enough, 50% of students who have claimed to have a bank account scored higher than students who do not have any accounts.

The United States Department of Education has seen the problem at hand and understands actions need to be taken in order for these students to be financially literate. The Department of Education explained, “there’s a clear opportunity for more states to require personal finance training as part of a high school degree. The Council for Economic Education reported that as of 2014, 17 states required students to take a high school course in personal finance or that personal finance be included in an economics or civics course as a graduation requirement.”

Even though it is great that the United States is beginning to implement required classes in their curriculums, the leading countries, in particular, Shanghai, China has required students since the early 1970’s to take classes in finance in their primary and secondary schools. These leading countries focus on financial excellence in their school systems. The majority of the time, business and finance drive the entire economy so it makes sense that these nations would want to develop the financial knowledge of their students.

Being the first test that PISA conducted on financial literacy, the Huffington Post states the students of America are headed in the right direction thanks to the National Jump$tart Coalition for Personal Financial Literacy and the Practical Money Skills website, which will be available to students in schools across the country. For students looking to find out more about how to prepare for their future, read this post on how to save for college.