Americans deserve to be financially literate before making financial decisions
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Leaders around the country are increasingly recognizing the importance of financial knowledge and empowerment for young Americans – 19 states across the country, including Kentucky, have made financial literacy a high school graduation requirement. As chair of the National Association of State Treasurers’ (NAST) Financial Education & Empowerment Committee, I am very encouraged by this trend. To ensure that all American students are receiving the financial education they deserve, we need to maximize these efforts. That is why I stand with NAST in supporting the creation of state-designated financial literacy graduation requirements for high schools in every state.

Students who graduate from high schools in states with financial education requirements are more equipped to make better decisions about how to pay for college. Financially literate students are more likely to apply for financial aid, including grants, are less likely to have outstanding credit-card balances, and have decreased private loan amounts. It is imperative that students understand the cost of borrowing before they are dealing with debt and, clearly, financial literacy is key to such understanding.

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Early financial education is sure to have a national impact. Financially literate teens make more informed financial choices and will be less likely to need public assistance as adults. Of course, this helps the individuals who become financially literate, but it also saves taxpayers money. Americans between the ages of 18 and 24 carry an average of $22,000 in personal debt. Given this fact, we need to empower students with the knowledge to manage this debt, avoid defaulting on their loans, and make smart financial decisions throughout adulthood.

Nearly two-thirds of Americans are not able to pass a basic financial literacy test, according to recent findings from the Financial Investment Education Foundation. We need to increase the number of financially literate citizens, and high school requirements are a strong place to start.

While I support a state- designated financial literacy graduation requirement, I would be remiss if I did not recognize and acknowledge that the implementation of such a policy will impact teachers. When introducing a new curriculum we need the appropriate infrastructure and guidelines to ensure that both teachers and students succeed.

Last year in Kentucky, we enacted a financial literacy graduation requirement law that could serve as a model for a national policy. We did not abruptly change the curriculum for our teachers and leave them to implement it, rather, we launched a database to provide educators access to clear online teaching resources to make sure the new requirement was achievable for them, too.

Recently, my three-year push for improved financial literacy in Kentucky culminated in the creation of a Financial Empowerment Commission. The Commission is tasked, in part, with providing support to state educators and thanks to a partnership I have secured with Kentucky credit unions, it will do so without costing taxpayer dollars.

Our high school students will soon be expected to make complex decisions about school loans, mortgages, credit accounts, and retirement-savings programs. We need to equip them with the right tools to make these decisions. Everyone deserves access to financial education. This type of education will profoundly impact our younger generations by positioning them for success throughout the rest of their lives. This is why I, alongside NAST, support the passage of a state- designated financial literacy graduation requirement.

Allison Ball is the State Treasurer of Kentucky and also serves as the chair of the of the National Association of State Treasurers’ Financial Education & Empowerment Committee.