Personal Finance: A Must for High School Students

The world has changed drastically since the formation of the public school system. Along with these changes the course requirements for graduation have changed minimally. There are several courses that need to be revamped or added to these requirements. To be better prepared for entering the adult world, all education systems should require a personal finance class as a requirement for graduation. Personal Finance would offer students valuable lessons in tax preparation, budgeting, and credit management.

Every citizen of the United States is required to pay taxes, yet most students enter their adult lives with no direct knowledge of how to prepare their own taxes. The lack of knowledge in tax preparation has created a multi-billion-dollar industry to charge people to prepare taxes. This could be avoided by adding a simple course requirement to all high school students. As Nancy Hite et al. state, “Personal financial competency is an essential ingredient for successful living in the 21st century” (253). This shows that without personal finance instruction students are lacking key skills to have a successful life. This course could walk students through all aspects of tax preparation from filling out a w-2 to the 1040 ez and all common tax situations in between.

Life costs money. As the adage says money makes the world go round. Without proper budgeting skills students are set up for failure. Budgeting skills show students the value of a dollar and the importance of saving. All aspects of budgeting should be covered at the high school level. Rent, utilities, groceries, household necessities, car payments, and insurance are examples of everyday expenses that most high school students do not know the actual cost of as they have not lived on their own. If high schools were required to teach personal finance students would also be able to understand the importance of adding IRAs, life insurance, savings bonds, and general savings plans to their budgets. As shown, “With the sparse number of high schools offering a personal finance course in Kansas as well as many other states, it must be recognized that young adults in the United States are probably not financially literate” (Hite et al. 257). This demonstrates that without proper personal finance education students can become financially illiterate thus making real life budgeting hard or non-attainable. This simple class could make a world of difference towards the number of students who enter the workforce at a financial disadvantage.

The last major reason that personal finance should be taught in high school education is credit management. It is a well-known fact that credit card companies send out pamphlets and sign-up letters to people all the time in the mail. Targeted through mailing lists and primarily to young adults. With no knowledge of how credit cards work this leads to a vast number of students being in severe debt before they even realize what credit is. If credit management was taught through a high school personal finance course more students would be aware of the risks of over utilization of credit cards, and the importance of making sound credit decisions. As Nancy Hite et al. state, “Traditionally, financial literacy has been taught in secondary schools, even though one study reported secondary education courses in personal finance may not improve immediate financial literacy” (qtd. in Hite et al. 254)

In conclusion the one class that could change the course of the American economy forever would be personal finance. With students being taught tax preparation they would in turn save thousands of dollars in their life in tax preparation fees. Learning budgeting skills and the importance of saving can change the landscape of the working-class economy. Teaching credit management skills would prevent students from falling victim to credit card company schemes and predatory lending. With a personal finance requirement students would enter their adult lives with the knowledge and capability to lead a financially sound future.

Works Cited

Hite, Nancy Groneman, et al. “Personal Finance Education in Recessionary Times.” Journal of Education for Business, vol. 86, no. 5, Aug. 2011, pp. 253–257. EBSCOhost, doi:10.1080/08832323.2010.511304.