When high school graduates toss their caps in the air this spring, they probably won't be thinking about grownup financial issues.
Yet, whether heading off to college or diving straight into the workforce, these teens will find themselves suddenly navigating the complicated world of adult money matters. They could be trying to grasp the terms of their student loan or feeling bewildered by exactly what credit is and why it matters.
"There's a variety of financial concepts they should know," said John Pelletier, director of the Champlain College Center for Financial Literacy in Burlington, Vermont.
"Do we only want people to learn about these things by experience and mistakes, or do we want to help them learn in advance so they don't make mistakes that harm them?" Pelletier said.
As part of the center's shout-out to Financial Literacy Month, which ends April 30, the center released a list of the top 10 states that do the best job of providing personal finance instruction to their high school students (below). The ranking is based on the center's 2017 National Report Card on the topic.
Best states for personal finance education in high school
| Rank | State | Grade |
|---|---|---|
| 1 | Utah | A+ |
| 2 | Alabama | A |
| 3 | Missouri | A |
| 4 | Tennessee | A |
| 5 | Virginia | A |
| 6 | Florida | B+ |
| 7 | Illinois | B+ |
| 8 | West Virginia | B+ |
| 9 | Georgia | B+ |
| 10 | Maryland | B |
Source: Source: Champlain College Center for Financial Literacy
As it stands, 24 states mandate personal finance education, either through a separate class or as part of another course, according to the report card.
And while parents could be teaching some of these topics at home, it appears their efforts are lacking.
About 44 percent of parents are "extremely reluctant" to discuss money with their kids, and 76 percent of children say their parents sometimes confuse them when talking about money, according to a 2017 T. Rowe Price survey.
A separate report from the National Foundation for Credit Counseling found 42 percent of adults gave themselves a C, D or F grade regarding their personal finance knowledge.
Rating the states on personal finance education
| Grade | Share |
|---|---|
| A | Five states (10%) |
| B (15+ hours of instruction) | Six states (12%) |
| B (under 15 hours of instruction/hours can't be estimated) | 13 states (26%) |
| C | 12 states (24%) |
| D | Four states (8%) |
| F | 11 states (22%) |
Source: Source: Champlain College Center for Financial Literacy's 2017 National Report Card
"Adults struggle mightily with personal finance," Pelletier said. "The idea that parents are teaching it to their kids at home is wrong."
There is some evidence that mandating such courses in high school works. Students required to study personal finance boasted better credit scores and lower debt delinquency rates as young adults, according to a 2014 study from researchers at the Federal Reserve.
The only state that earns an A+ grade from the Champlain Center's top 10 list is Utah. High school students there must take a half-year course dedicated to personal finance and then take an end-of-year exam, administered by the state, to test their knowledge.
While the particulars of the grades awarded to each state differs, those that earn an A require personal finance instruction as a graduation requirement that's equal to a half-year course. States getting a B require such education, although it could embedded in another course.
States receiving a C grade have personal finance topics among its academic standards but no specific requirements for instruction. A grade of D means the state's requirements are modest and an F means the state has virtually no requirements for such education.
"If you don't do this in high school, when will it get done?" Pelletier said.
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