2023 Report Card Introduction

The Center for Financial Literacy at Champlain College was established in 2010. At that time, our Center was trying to understand the requirements for personal finance education in public high schools in each state and the District of Columbia. As our Center gathered this information on each state, we decided that we should share it with the public and issued our inaugural National Report Card on State Efforts to Improve Financial Literacy in High Schools™ in the summer of 2013.

This report is the fourth issued by our Center on this topic over the last decade (reports in 2013, 2015, 2017, and 2023). On this 10th anniversary of our first report, we hope that continuing to grade each state on how well it teaches high school personal finance will play a part in moving America closer to guaranteeing access to financial literacy education for all high school students.

young people in a classroom working on computers

Our Center last looked at personal finance education in America with its 2017 National Report Card. At that time, just five states earned an A grade, and less than one out of 10 public school students nationwide lived in a state that guaranteed access to this critical course prior to graduating from high school.

There was so little substantive change by the summer of 2019 from the 2017 report that we decided to delay the update for a year or more. Then COVID-19 arrived in March 2020.

The pandemic did two things. It delayed our fourth report card to 2023 as our Center reimagined how we could provide our existing financial literacy training to many more of our nation’s K to 12 educators. It also greatly accelerated the pace of policy change occurring in the states. For students who graduated in spring 2023, seven states guaranteed a standalone personal finance course, but more importantly, in five years, we project that 23 states will have this guarantee.

In 2018, less than half of the adults surveyed indicated that they had a rainy-day fund that would cover three months of expenses (49%) in the FINRA Financial Capability Study. When COVID-19 hit the nation, unemployment skyrocketed from 3.5% in January 2020 to 14.7% in April 2020—levels not seen since the Great Depression. Through no fault of their own, millions living paycheck to paycheck were deciding whether to buy groceries or pay the rent, mortgage, or utilities.

During the pandemic, it became clear to state legislators how financially fragile many of their constituents were. Overnight, legislators in states across the nation became more receptive to the need for personal finance education in our schools. Witness how, in recent years, legislation requiring a personal finance course as a high school graduation requirement passed easily by incredibly wide margins in many states. During a time of intense political division in our nation, this change in state policy is a purple issue, not a red or blue one.

It may be one of the few issues that Americans, regardless of their politics, agree on. A 2022 poll by the National Endowment for Financial Education (NEFE) indicated that nearly nine out of 10 (88%) adults surveyed wanted their state to require a semester or yearlong financial education course for graduation from high school, and eight in 10 adults wished they had been required to take such a class when they went to school.

In 2023, 1.7 million students attended high schools in our grade A states, while in 2028, there are projected to be 6.4 million students attending school in grade A states. Thus, in five short years, more than four out of 10 U.S. high school students will be enrolled in high schools where a stand-alone, full-semester course in personal finance is required before graduating. That’s a 229% increase from the 2017 report.

The personal finance education momentum has been building in part because of the availability of free, online curricular resources offered by state departments of education and by many other organizations, often nonprofits. But as this momentum continues, we must pay attention to the critical importance of teacher training. For example, we project that there will be a need for 30,000 highly trained personal finance educators in just the grade A and B states by 2028.

Our Center knows that many high school administrators believe that teachers from various disciplines can teach personal finance. However, we found that untrained teachers often lack the confidence and knowledge to teach this complex subject well. Taxpayers and parents rightfully expect teachers to be trained in personal finance, just as they are required to be trained to teach language arts, history, civics, math, or a foreign language.

Personal finance education is a cumulative process, so our Center always encourages the teaching of this subject in grades Pre-K through 8. However, grades 11 and 12 in high school are critically important in terms of honing financial knowledge and skills. Students in those grades are poised to enter college, the workforce, or the military and will quickly face a host of complicated financial decisions. We’ve outlined these later in the report, but suffice it to say that learning personal finance at this juncture arms young people to navigate a world of college loans, leases, credit cards, savings, investing, and much more.

Because projections don’t always happen, we have tweaked our grading system and now grade a state for its policy applied to the students that graduate in the year the report is issued. But we also have a second projected grade for states with new policy changes that will not be fully implemented until a future date. We know from experience that policies can be diluted prior to implementation.

In addition to the projected grade described above, two other changes distinguish this report from the three previous versions. The first is the inclusion in our state summaries of the public policy for each state regarding financial literacy instruction in grades Pre-K to 8. This is provided for informational purposes only and is not taken into account when grading the states. The second change is including, for the first time, articles written by leading national experts on two topics that we want to highlight in this particular report.

The first article by Angela Fontes, Hanna Gilmore, Gary Mottola, and Olivia Valdes, from the FINRA Investor Education Foundation, reviews the racial and ethnic disparities in financial capability drawn from the most recent FINRA National Financial Capability Study. The authors conclude that closing this gap will require a concerted effort that addresses obstacles adults of color face, including access to high-quality financial education.

The second article is written by Dr. Carly Urban of Montana State University. It highlights research that shows the many benefits of requiring financial literacy education in high school and how this type of education is a low-cost investment for states to make. She also highlights research that shows why such an educational intervention is most successful when done as a stand-alone graduation requirement. She adds that educators assigned to teach financial literacy appear to increase their own financial capability.