The Link between Income and Financial Education in High Schools: New Evidence from Three States

Abstract

Financial literacy is at low levels in the United States. Simultaneously, not enough states require students to take a personal finance course to graduate. In this paper, I examine whether there is a correlation between median household income in school districts and access to financial education at local high schools. The most recent data on local high school standards implies that varying state approaches to implementing financial literacy education produce divergent outcomes in terms of student access - particularly when examining the data through the lens of economic cohorts. This paper analyzes different financial education standards and implementation approaches across 3 states: Texas, Pennsylvania and California. The main findings are that 1) there is a correlation between household income and access in a state with only vague personal finance education mandates, and 2) when a state has specific or no mandates, levels of financial education are high or low, respectively, but access is equal among income groups.