The importance of financial education – Fast Lane
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The importance of financial education

Young people drive our economies – and our future – but most of them have never learned to save, manage, and invest their money. A financial education program is one of the most effective ways to teach money management at an early age and lay a foundation on which they can find success later in life.

Think of average U.S. teenagers today. In the course of their lifetimes, a lot of money will pass through their hands. They will face a multitude of financial decisions and countless opportunities to save, spend, or invest. It is crucial that young people receive the education and skills they need before they are overwhelmed with responsibilities.  

Financial education is the path to financial literacy. It is the learning process that introduces and deepens the knowledge needed to manage personal finances. Simply put, financial education can give students a brighter future.

Growing research around the world shows that well-designed financial education programs can have an impressive effect on financial literacy and behavior. Many people are taking notice, including policy makers. The number of countries that have or are in the process of implementing national financial education strategies has doubled in just five years.  Read the OECD/INFE highlights here.

National Strategies for Financial Education (NSFE) Policy Handbook

National Strategies for Financial Education OECD/INFE Policy Handbook.

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Mounting research shows that financial education has a positive influence on the financial decisions people make. Here are just a couple of highlights illustrating this:

In the United States:

One study looked at three states where financial education was required for high school graduation. It found higher credit scores and more frequent on-time loan payments for young adults who had taken a required financial literacy course than for those in states with no such requirement. The report also found that fundamental improvements in people’s behavior do not happen overnight, but they will manifest over time. Click below to read the research published by FINRA Investor Education Foundation.

Around the world:

Peru saw a big improvement in students’ financial knowledge, and even in teachers’ knowledge, after a financial education course was conducted at the high school level. This research revealed other improvements, too, such as better self-control and consumer habits. Click below to read about the research from Dr. Verónica Frisancho.

State Financial Education Mandates: It’s All in the Implementation

State Financial Education Mandates: It’s All in the Implementation

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The Impact of School-Based Financial Education on High School Students and their Teachers: Experimental Evidence from Peru

By Veronica Frisancho

Using data from a randomized controlled trial in 300 public high schools in Peru, this paper studies the potential of school-based financial education programs for youth.



Financial education is critically important and is best taught in school. However the Council for Economic Education’s Survey of the States finds that only 17 states require a high school course that includes personal finance concepts. We want this to change. We know that financial education in the schools can

  • reach individuals before costly decisions are made.  
  • help people build lives marked by greater financial stability.
  • empower large numbers of people all at once, making financial education programs impactful and wide reaching.
  • provide access to all. Our research shows that only a privileged fraction of people are financially literate. School-based financial education levels the playing field.


2018 Survey of the States (CEE)

Read the Council for Economic Education 2018 report on the different levels of implementation of personal finance and economics across the U.S.

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