In honor of Financial Literacy Month, which falls every April after a designation by the U.S. Senate in 2004, we thought it would be interesting to share the results of a new study by WalletHub. The study measured the financial literacy of residents in the 50 states and the District of Columbia by measuring financial habitsâ€”ranging from things like having an emergency fund and making just the minimum monthly payment on credit cardsâ€”to their scores on a financial education test.
Citizens of New Hampshire topped the list, with Minnesota and Illinois, topping out the top three. Nevada, Alaska, and the District of Columbia rounded out the bottom. Click the interactive map below to see where your state ranked.
â€œThe best way to improve financial literacy is to include personal finance in the curriculum taught in the school system starting with K-12, and into college,â€ says Vickie Hampton, Professor in the Personal Financial Planning Department at Texas Tech University.
â€œPersonal finance needs to be taught by teachers who know the concepts, which will require educating teachers, and it needs to be given the importance given to other required subjects,â€ she adds.
According to the Council for Economic Education:
- Just 20 states require students to take an economics course
- Just 17 states require high school students to take a course on personal finance
- 0 states require standardized testing of economic concepts
While states have been slow to provide Americaâ€™s students with education in money management, the Obama administration has taken steps to fill the void. The Presidentâ€™s Council on Financial Capability and the Consumer Financial Protection Bureau (CFPB) have created an online tool called Money As You Grow, which provides parents and educators with resources to streamlined tools to teach children how to manage money.
â€œThe financial literacy materials that are out there areÂ a messy patchwork of curricula, standards, and guidelines,â€ says Beth Kobliner, a member of The Presidentâ€™s Council on Financial Capability, and author of forthcoming book, Make Your Kid a Money Genius (Even If You’re Not).
â€œThatâ€™sÂ whyÂ I spearheaded the effort as a member ofÂ President Obamaâ€™s Advisory Council on Financial CapabilityÂ to sortÂ through everything that was available and winnow itÂ down to theÂ 20 things that kids need to know to live financially smart lives,â€ she adds.
Kobliner says that parents should also remember that despite the debate about financial education in the classroom, they are the No. 1 influence on their kidsâ€™ financial behavior, and must walk the walk in their own behavior in order to create truly money smart kids.