Why Financial Literacy Belongs in Every High School

Financial literacy belongs in every high school because school is the one place that reaches every student before the first loan, lease or paycheck. Randomized trials show that school courses raise what students know. The evidence on what students do with that knowledge years later is thinner, which is why the case here is for a required, well-taught course rather than a token one.

I learned how money works in the first grade. I grew up in Bronzeville, on Chicago's South Side, and went to Ariel Community Academy, one of the few schools in the country that taught financial literacy starting in first grade. By the time I earned a Finance degree at the University of Illinois and took my first job as a Credit Analyst at CIBC, the fundamentals were second nature. I got that head start only because I happened to attend that one school.

Why does financial literacy belong in schools and not just at home?

Because "learn it at home" only works if your home happens to know. Money knowledge is not evenly distributed: in a national survey of young adults, financial literacy was strongly related to family financial sophistication (Lusardi, Mitchell and Curto, 2010). Expecting families to transmit skills many of them were never taught just passes the gap down another generation. School is the one place we can reach every student regardless of what their parents know, earn, or had the chance to learn.

We already accept this logic everywhere else. We do not tell kids to pick up reading, biology, or civics on their own time. Nearly every graduate will, within a few years, sign a lease, take on a loan, get a paycheck with mystifying deductions, and decide whether to save for a future they can barely picture. We send them into all of that and hope they figure it out. We treat the one subject every single student will use as the one subject we can skip.

What does financial illiteracy actually cost?

It costs real money, by people's own count. In a December 2025 online survey of 1,200 U.S. adults, the National Financial Educators Council (NFEC) asked how much respondents thought they had lost that year because they lacked personal finance knowledge. The average answer was $948 (NFEC, 2025). That is a self-reported estimate from an online panel, so read it as how costly people believe the gap is, not as a measured loss.

The knowledge itself is thin, and it is thinnest exactly where we should worry most. On the TIAA Institute-GFLEC Personal Finance Index, U.S. adults on average answer only 47% of the index's 28 questions correctly, the lowest result in its 10-year history. Gen Z answers just 38%, the group the 2026 report singles out for the widest gaps (TIAA Institute-GFLEC, 2026).

The case at a glance

The argument, the evidence, and where it comes from, one row at a time.

Why high school, specifically?

Because high school is the last moment we have every student in one room right before the money decisions get real, and because the habits and the math both reward starting early.

Much of the U.S. evidence compares states that started requiring a personal finance course with states that did not. Montana State economists Christiana Stoddard and Carly Urban used that approach (a difference-in-differences design) on incoming college freshmen. Where a graduation requirement existed, students were more likely to use federal aid and less likely to carry a credit card balance. Among those who borrowed privately, balances were about $1,300 lower, a figure the working paper also gives as roughly $1,500 in its introduction (Stoddard and Urban, 2020). The working-paper version also looked at Montana, which has no mandate: where high schools offered a course without a graduation standard, effects on those decisions at four public universities were negligible. A separate study of credit reports linked requirements to higher credit scores and fewer defaults among 18- to 21-year-olds, with large differences from state to state (Urban et al., 2020).

Does school-based financial education actually work?

On knowledge, yes, and the evidence spans many countries. A meta-analysis of 126 impact evaluations from around the world found that financial education significantly raises financial literacy and, to a smaller degree, financial behavior, and the result held in the randomized trials alone (Kaiser and Menkhoff, 2017). In the World Bank working-paper version, the average literacy gain was about 0.26 standard deviations, roughly the gap between a typical participant at the 50th percentile and one at the 60th, averaged across all populations studied, adults included. The average behavior gain was about 0.09.

The school-based studies agree on knowledge.

The Peru study is worth a second look if you teach. The lessons ran inside a history, geography and economics course, with a 20-hour teacher training and ready-made workbooks. The teachers learned too: their financial-knowledge exam scores were 0.32 standard deviations higher than the control group's (working-paper figure).

Where does the evidence run out?

Knowledge gains are easier to find than behavior gains. A meta-analysis of 201 studies found that financial education explained only 0.1% of the variance in the behaviors studied, and that even large interventions had negligible effects on behavior 20 months or more later (Fernandes, Lynch and Netemeyer, 2014). Kaiser and Menkhoff found a larger but still modest behavior effect, which they link partly to newer studies. The Amagir et al. (2018) review of programs for children and teens found that studies of actual behavior are scarce and show hardly any effect.

A mandate is not automatically better. Kaiser and Menkhoff found that mandatory formats tentatively appeared less effective, that effects were smaller for low-income participants, and that intensity and timing (a "teachable moment") mattered. The state comparisons above are not randomized, and the credit-report study found large differences between states, which its authors suggest may come down to how well teachers are prepared. None of the studies above is a U.S. randomized trial of a high school course: the U.S. randomized work involves fourth and fifth graders, and the U.S. high school evidence is a pretest-posttest evaluation and state comparisons. Brazil and Peru are not the United States either, so the design transfers, not the exact numbers.

That matters for the equity case. Stoddard and Urban found the drop in private borrowing concentrated in higher-income families, although students from lower-income families shifted further toward subsidized federal loans and away from credit card balances. A requirement reaches every student, but it does not ensure equal gains. So the case here is for a funded, semester-long course with trained teachers, with the most attention where students have the least outside support.

Answering the honest objections

The usual objections deserve real answers.

"There is no room in the schedule." Schedules are tight, and a semester is a real cost. The best state comparison argues against settling for less: a 2025 working paper found that requiring a full semester of coursework was associated with better credit scores and financial well-being, while letting schools fold the content into other classes was not (Collins and Urban, 2025). If a full semester is impossible, the evidence for a smaller version is thinner, and that is worth saying to your board.

"Kids won't care about money math." Many already care about money. What a classroom can add is practice before real money is involved, and the review of school programs names experiential learning as a promising method.

"It's already covered inside our econ or math course." Sometimes, a little. But the state comparison above found the gains alongside a required full semester, not alongside embedded content.

What "taught well" looks like

A required course taught from a worksheet can satisfy a mandate and still leave students no better off, and the review of school programs points to experiential learning as the promising alternative. That research guides how we build Rapunzl: a standards-aligned curriculum that scales from a 3-week unit up to a 28-week, year-long course, paired with simulated $10,000 stock and crypto portfolios with live Nasdaq pricing, so students practice money decisions against prices that really move. Rapunzl began in a single Chicago high school in 2018 and has inspired 150,000+ students since. On Rapunzl's own pre- and post-program assessments, scores went from 34% to 93%, 26 points above the national adult average (NFEC) of 67%.

The bottom line

The research is strong that students learn this material when it is taught, more mixed on what they do with it years later, and encouraging for states that require a full course. How a requirement is written matters as much as whether one exists.

Planning a required personal finance course, or strengthening the one your school already runs, is a conversation worth having with our team. Request a demo to talk through what Rapunzl could look like in your classroom.

By Myles Gage, Co-Founder and CEO of Rapunzl.