Financial literacy

North Carolina public schools will now require students to pass a financial literacy class.

NORTH CAROLINA — North Carolina public school students will be required to pass an economics and personal finance class in order to graduate starting with the 2020-21 freshman class.

N.C. House Bill 924 was passed into law in July 2019, mandating the development of the course to teach financial literacy. According to the N.C. Department of Public Instruction, the national standard for K-12 personal finance education defines financial literacy as “the ability to use knowledge and skills to manage one’s financial resources effectively for lifetime financial security.” This is the definition published by Jump$tart, a a national nonprofit coalition of organizations that states it has a commitment to advancing youth financial literacy.

The bill states that the financial literacy course would cover topics such as the true cost of credit, choosing and managing a credit card, borrowing money for an automobile or other large purchase, home mortgages, credit scoring and credit reports and planning and paying for post-secondary education.

“Financially literate people use their knowledge and understanding of economics, money, credit, saving, investing, budgeting, etc. to make informed decisions about their personal finances,” according to NCDPI. “From everyday spending to long-term financial planning, effective management of money, credit, savings and investments requires individuals to use their financial knowledge to plan for and further personal goals.”

Author and financial guru Dave Ramsey states on his website that financial literacy is changing communities for the better as the “the majority of people don’t know how to handle their money.”

Ramsey referenced a report by the National Financial Educators Council that had more than 17,000 people from all 50 states take a National Financial Capability Test. According to Ramsey, the report states that less than half — at 48 percent — of participants were able to pass the 30-question test that covered topics like budgeting, paying bills, setting financial goals and other personal-finance related subjects.

“It’s one thing to learn how to add and subtract in elementary school, but it’s something else entirely to actually apply those principles to your own finances,” Ramsey states on his website. “Most Americans live paycheck to paycheck, and it’s largely because of a gap between what the math says they can afford and what they actually spend.”

To combat this, Ramsey said many young people are increasing their financial literacy knowledge through personal finance courses in high school. According to Ramsey, Ramsey Solutions Research surveyed over 76,000 American students who had taken a personal finance class, and he states that many of the results are a “stark contrast” to the NFEC report.

Julie Taylor, Director of K-12 Curriculum and Federal Programs at Ashe County Schools, provided some information about how N.C. House Bill 924 will impact students at the high school.

Taylor shared that the NCDPI is in the process of guiding local education authorities on how to best implement the changes to the current curriculum to accommodate the new requirement.

Teachers are responding to surveys for the K-12 Social Studies curriculum for the state-level standards revision committee to review, according to Taylor.

After the surveys are reviewed by the committee they will align the results with the best practices and research as they see fit before publishing the official standards for the new courses. This process can take multiple drafts.

According to Taylor, the anticipated approval date is Summer 2020.

The Social Studies department is aware that the changes will affect the rising Freshman class and has proposed a logical sequencing plan of classes. The sequence is based on the developmental levels of high school learners and the scaffolding needed for content understanding.

The proposed sequence is as follows:

Freshman: World History

Sophomore: Civics

Junior: American History

Senior: Economics and Personal Finance

“This just a logical proposal and not set in stone. A great deal of thought goes behind why the classes should be in this order and social studies teachers are passionate about their content and what their students need to know most,” Taylor said. “We really can’t do anything definite until the state makes a mandated direction or gives LEAs local decision making power about the sequencing of classes.”

According to Taylor, the surveys closed on Jan. 31 and the DPI should be sending more updates to the school system in the near future.

There will be a county-wide parent meeting held on April 7 to present updates on the math curriculum. This will be based on Senate Bill 500 which was passed to modify advanced math course enrollment.

The bill is planned to go into implementation this Fall, according to Taylor.

“We will have break-out sessions that explain the law and the changes. It is a big deal for math,” Taylor said.

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