I am a teacher at Robbinsdale Armstrong High School in Plymouth, where I teach both introductory and Advanced Placement (AP) economics. This is a subject that fascinates me for several reasons. Practical economics has a direct translation into the real world, which my juniors and seniors will soon be part of. As a result, I use my class to try to do my best to prepare them for what’s to come.
In a personal finance unit, students complete a comprehensive budget project in which they gain “adult” experience by preparing a monthly budget. This includes paying rent, insurance, student loans, auto loans, and more. The exercise is a real revelation for the students. Comments like, “Real life is very expensive” or “Wow, that kind of compound interest really works” are common.
Students learn that student loans are legally binding and how credit card debt can destroy dreams. They learn about the ever-changing investment arena, how time in the market is better than trying to time the market, and how diversified investments in low-cost index funds have historically outperformed most active traders over time.
It’s rewarding as a teacher to hear from my former students how they opened an IRA or successfully secured a business loan based on what they learned in class. A former student was so committed to what he learned in my class that after graduating from college and establishing himself as a young professional, he started funding scholarships for finance students of the Year, which are awarded to 12 of my students each year.
When I talk to parents about the personal finance topics I discuss with my high school students (things like budgeting, credit, saving, investing, and IRAs), I can’t tell you how many times parents respond: “I wish I had learned that in high school!”
When I show students the power of compound interest, how saving and investing small amounts of money regularly over a lifetime can turn into a small fortune, students often ask why more people don’t know about it. My answer is that it’s not their fault; most simply have never been taught. What a disservice to our future generations!
Personal finance education enables students to learn strategies that break the cycle of poverty and create generational wealth. They are more likely to invest their savings and less likely to fall prey to high cost predatory lending (like payday loans). Personal finance teaches practical survival skills – investing for retirement, navigating education and career decisions, managing credit, budgeting, insuring assets – skills ALL young people need to thrive in modern life . Can we think of anyone who would not benefit from exposure to this material in their lifetime?
A comprehensive education in personal finance prepares students to face the greatest sources of financial difficulty in our society…before they encounter them at “the school of hard knocks”. These skills are too important and require more than a short unit in an economics class or waiting for individual districts/schools to need personal finance. Currently, only 1 in 6 high school students in Minnesota are guaranteed to take a personal finance course before graduation.
Minnesota voters think the state can do better, too. In an April 2022 poll conducted by Public Policy Polling for the NGPF Mission 2030 Fund, 82% of our state’s voters said they “believe all high school students should be guaranteed a basic course in personal finance,” and 86% said it is urgent that lawmakers deal with it.
I urge our legislators to consider the research, which conclusively shows that students who receive high-quality personal finance training in school manage their finances better as adults, which translates to less debt, higher credit scores, higher personal income and a better quality of life in general. .
Once the bill is passed, I am confident that the implementation will go well as well. I took training from the Minnesota Council on Economics Education and Next Gen Personal Finance, both of which are great organizations that can take on the challenge of preparing teachers in Minnesota for free.
Momentum is building across the country by making personal finance a graduation requirement. Let’s make Minnesota a leader in education and prepare our students for the challenging financial landscape by ensuring that every student in Minnesota receives a high-quality education in personal finance.
James Redelsheimer teaches at Robbinsdale Armstrong High School in Plymouth. He is the author of Barron’s AP Economics, BestPrep Board Member, Master Teacher at the Minnesota Council on Economic Education, and Next Gen Personal Finance Teacher Fellow.