"US High School Students Are 'Finance Class Holics'... Mandatory Education in 20 States" [Essential! Financial Education]③

Professor William Bosshardt
Director, Economic Education Center, Florida Atlantic University, USA
Head of Revision Team for Standard Curriculum in Economics and Financial Education

Financial education is popular in American high schools. In the U.S., where there is a culture of experiencing part-time jobs early during teenage years, high school students are curious about the concepts and applications of asset management. During the COVID-19 pandemic, the stock trading fintech (financial technology) company Robinhood grew rapidly, and Generation Z (those born from the mid-to-late 1990s to the early 2010s) also jumped into investments such as stocks and funds.

The demand for financial education among students is also reflected in the changes in state-level curricula. According to the Council for Economic Education (CEE), a leading private economic and financial education organization in the U.S., only 6 out of 50 states had designated financial education as a mandatory subject in 2020, but now a total of 20 states require financial education.

William Bosshardt, an American expert in economic and financial education and a professor of economics at Florida Atlantic University, said in an interview with Asia Economy on August 24, “If there is a time constraint and only one can be taught between economic education and financial education, I would choose the latter, which is more interesting and practical.” However, he added, “It is concerning that economic education is being neglected due to this tendency. Ideally, schools should teach economic and financial education for half a year each.”

He also offered advice on the changes to South Korea’s economic and financial education curriculum starting next year. High school subjects related to economics and finance will be subdivided into “Economics,” “Finance and Economic Life,” and “Human and Economic Activities.” Professor Bosshardt explained, “Most American high schools that offer both economics and financial classes teach finance first. Students can then continue studying economics based on the financial knowledge they have already learned.”

Professor Bosshardt has been the director of the Economic Education Center at Florida Atlantic University since 1995. This center focuses on economic and financial education using active learning in middle and high school subjects. He also leads the team revising the standard curriculum for economic and financial education at CEE. The standard curriculum serves as a kind of guidebook when the 50 U.S. states decide their own curricula.

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Below is a Q&A with Professor Bosshardt.

- What is the difference between economic education and financial education?

▲ Financial education is a subject that looks at how a household earns income, saves, purchases goods and services, uses credit, invests, and prepares for losses. Economic education has a much broader scope. It studies how consumers, producers, and the government interact in a market economy.

- If you had to teach only one between economic education and financial education?

▲ At first, I thought economic education would be a better course for high school students. As I mentioned earlier, economic education provides comprehensive content related to economics and finance. However, my view has changed in recent years. I now believe financial education, which is practical and can also be interesting, is more suitable for high school students. If schools have to choose only one, I would recommend financial education.

Also, in the U.S., only about 50% of all high school students go on to college. That means the other half, who enter society directly, need to be prepared in high school. Since they manage their finances with jobs without learning about financial markets in college, financial education is even more necessary in high school.

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- Are American high school students interested in financial education?

▲ Interest in financial education is increasing. American high school students access financial markets by using credit or debit cards and trading stocks through applications (apps) like Robinhood.

This trend is also reflected in the selection of high school curricula across the 50 states. Each state has its own curriculum, and the required subjects for graduation are determined at the discretion of each state. According to a CEE survey, only 18 states designated economic education as a graduation requirement. In the past, more states mandated economic education. However, with the rising popularity of financial education, currently a total of 20 states require financial education as a mandatory subject.

- Is experiential learning used in financial education?

▲ Yes. American financial companies show great interest in participating in high school-level financial education. This is one of the reasons why the number of financial courses in high school curricula is increasing.

[Image source=AP Yonhap News]

- Are there concerns about the declining interest in economic education, which is the opposite of financial education?

▲ The academic community is very alert to this trend. For example, according to the British polling organization YouGov, 35% of Americans responded that lowering interest rates slows down inflation.

For citizens participating in a market economy to properly understand and form opinions on economic policies, they must first understand what a market economy is. Learning the basics of supply and demand helps explain why prices change and can make one a better consumer. The more attention is focused on financial education, the more support for economic education might decrease, which is concerning. I believe it is better to support both economic and financial education.

- South Korea will introduce a new subject called ‘Finance and Economic Life’ in the high school curriculum starting in 2025. If both economic and financial education are offered, which should be taught first?

▲ Most American high schools that offer both economics and financial classes teach finance first. For beginners, finance is generally a more engaging and accessible field. Learning finance first allows students to continue studying economics later based on the interesting financial knowledge they have acquired.

- Are there any implications regarding economic and financial education in the U.S.?

▲ Economic education is often not a mandatory subject or is not tested in many American high schools. Even if economic education is included in the standard curriculum, if there is no requirement to take it for graduation or no evaluation after completing the course, its content cannot be emphasized. Ideally, students should study financial education for half a year and economic education for half a year at the high school level.