Along with teaching reading, writing and math, Wisconsin public schools could be assigned another fundamental mission — helping students understand basic personal finance concepts such as credit, compound interest and budgeting.
With bipartisan support, the state Assembly last week passed a bill that would require public schools to incorporate financial literacy into their kindergarten-through-12th grade curriculum.
If the bill becomes law, which supporters say appears likely, it would be the first time school districts would be compelled to work financial instruction into the lessons of students throughout their academic careers.
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Backers of the bill say the goal is to impart a basic life skill to students who too often graduate knowing very little about how money works — a situation that quickly can lead to unmanageable debt and other financial problems.
“We want to pull out all the stops to help raise the financial acumen for everybody in Wisconsin,” said Michael Semmann of the Wisconsin Bankers Association, one of the industry groups that has been pushing for training in fiscal know-how at state schools.
In 2006, the state Department of Public Instruction established standards for what students should learn about personal finance and money. Many districts have taken the initiative, with teachers getting special training in how to work personal finance lessons into subjects like math and social studies. More than 100 schools in the state host on-campus, student-run credit union branches where youths can get real-life experience with a financial institution.
However, not all school districts are so active in their financial literacy efforts, and backers of the bill say they don’t want some students left out.
According to the bill’s co-author Scott Krug (R-Nekoosa), 74% of the state’s more than 400 school districts integrate personal financial literacy instruction across their curriculum at some grade level, with 60% offering it before high school.
However, districts don’t have to teach students how to handle money, in part because of opposition over the years from educators concerned about the legislature imposing another unfunded mandate on them.
This time, however, the Wisconsin Association of School Boards took a neutral stance on Krug’s financial literacy legislation — co-authored by Milwaukee Democrat Jason Fields — because it leaves the question of how to incorporate the lessons up to the discretion of each school district.
Districts don’t have to develop their own curriculum, for example. They could use programs already put together by the bankers association, other school districts or organizations interested in increasing financial literacy.
That makes the teaching requirement less of a financial imposition, particularly for districts that have less revenue and resources to work with, said Dan Rossmiller, government relations director for the school boards group.
“Although it’s somewhat of a mandate, it’s not as specific and not necessarily as costly,” Rossmiller said.
The bill has the backing of the state Department of Financial Institutions, which has long been an advocate for efforts to incorporate personal finance education in schools.
DFI spokesman George Althoff said the department’s Office of Financial Literacy, working with Gov. Scott Walker’s Council on Financial Literacy and many public and private-sector stakeholder groups, “is committed to measurably improving the financial capabilities” of Wisconsin citizens.
“The more we can do to promote financial literacy at a young age, the better off our children will be when they reach adulthood,” Althoff said.
Although the bill passed in the Assembly on a voice vote with no opposition last week, not everyone in state government is on board with the bill. The Department of Public Instruction, while encouraging financial education in Wisconsin schools, has some issues with the proposed requirements, said spokesman Tom McCarthy.
“We’re opposed because we feel like mandates aren’t the best solution to increasing financial literacy with students,” McCarthy said. “Mandates are generally viewed as a ‘cross-the-bar’ and can result in districts doing that and no more. And up to this point, we have been working with school districts to build robust financial literacy programs. It’s more of a concern around implementation than the concept and value of financial literacy.”
The Senate, which, like the Assembly, is controlled by Republicans, has its own version of the same bill. The Senate is expected to take up the matter in the fall. If it passes there, it would go to Walker.
Semmann said he’s “pretty optimistic” the bill will become law.
“This is a long-term foundation that we’re trying to build,” said Semmann, who is executive vice president and chief operations officer of the state bankers group. “And as you take a look at how to ensure families can keep a sustainable future, the best way is to keep providing information to them about how to do it.”