Public schools in America are not required to teach financial literacy. We have seen the repercussions of America’s financial illiteracy over the decades and it will be absolutely crucial to understand basic personal finance during this volatile time. A new Pennsylvania law ensures that 53% of high school students in the US will have guaranteed access to a mandatory financial education course. Currently, eight states guarantee that students will take a personal finance course, and 17 states are in the process of implementing similar policies. This initiative is aimed at equipping students with essential financial knowledge before graduation.
A study by Walden University found that 4 in 7 Americans are financially illiterate and cannot manage their personal finances. The study believes finance should be introduced in schools at a kindergarten level, no different from math, reading, or other pillars. The National Financial Educators Council estimates that 254 million Americans were financially illiterate as of 2022, costing Americans $436 billion.
The majority of Americans live paycheck to paycheck. I reported in 2022 that even one-third of high-income citizens earning over $250,000 annually were also living paycheck to paycheck, as inflation does not discriminate based on income. We have seen hardship 401K withdrawals increase this year. Credit card debt is the highest it has ever been. A survey by Clever Real Estate found that 64% of Gen Xers have stopped saving for retirement as they are either paying off past debt or simply cannot afford to save.
The US government also knows that the next generation will NEVER see Social Security. Retirement is now viewed as an unobtainable luxury to most. Social Security is not enough to live on alone, and a good portion of the nation simply does not have the savings to exit the workforce. Financial literacy is crucial to our nation’s success and this one piece of government funding I believe could pay off in the long-term.
