Financial literacy in Vermont schools: Grade D

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When it comes to evaluating the quality of teaching financial literacy in Vermont's high schools, a D grade was handed out. According to a recent editorial in the Rutland Herald, the Center for Financial Literacy at Champlain College ranked all 50 states and the District of Columbia in how they were preparing high school students in financial literacy.

According to the RH, only five states obtained an A grade, while 31 states received a B or C ranking. Vermont joined three other states in getting a D ranking — and it could have been worse; 11 states ended up with an F. Part of the classification status has to do with the criteria that, if a state has mandatory financial literacy as a prerequisite to graduation, an A ranking can be secured. At the other end, if a state has no requirements whatsoever, an F ranking will be assigned.

Vermont has not ignored the issue. On January 8, 2018, the Financial Literacy Commission issued their final report with recommendations to the Governor and several committees of the State Senate and House. The 12-member commission was headed up by the State's Treasurer, Beth Pearce, and Prof. John Pelletier of Champlain College (who was the author of the national survey mentioned above).

Also, in January, the Agency of Education issued its report to the State Board of Education recommending the adoption of the national standards for financial literacy in schools. Presently, there are 12 schools in Vermont that make the teaching of financial literacy mandatory. With the adoption of the standards, Vermont will move up a grade, to C.

Frankly, I don't think the teaching of financial literacy belongs in the schools in the first place, and I am fully aware that parents/guardians are unable, reluctant or uncomfortable teaching financial literacy at home.

When it comes to what should be taught, it can be condensed into the following topics: how to read and or prepare a personal financial statement and budget, insurance agreements, leases, bank statements, and credit card statements; how to acquire and manage debt whether it be a car loan, student loan, credit card, or later a home mortgage; and how to accumulate assets, whether they be stocks, bonds, savings account, car, home, or personal items.

Now let's go back and see why a course on financial literacy should not be taught in our schools. The teaching staff is already being swamped with other non-academic subjects such as sex and health education, sensitivity training, and home economics (if still done). Also, most high school teachers do not feel competent to teach financial literacy and would have to have extensive training to do so.

A possible solution would be to make it mandatory that high school students in their junior and senior year attend a Saturday workshop over a four-week period where financial literacy subjects will be taught. The teachers will be volunteers from the local community with backgrounds in asset and credit management, as well as taxes. Some candidates would be local bank loan and wealth management officers and possibly local CPA's or corporate financial personnel.

Young adults need a well thought-out financial literacy program. When it comes time for them to deal with credit, obtain a mortgage, buy or lease a home or a car, invest in the stock or bond markets, it should not be a daunting experience, if they are prepared.

There comes a time when we just have to recognize that our schools cannot be the last resort to teaching our young adults all that they need to know to navigate the world they enter after graduation. Good examples of this are the programs used to teach hunter safety programs and driver education. These critical and worthwhile programs are done outside our schools and have been most successful and run by volunteers. Why not do the same for the teaching of financial literacy?

Don Keelan writes a bi-weekly column for the Banner and lives in Arlington.

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