You can put a price tag on the value of a personal finance education

Taking a financial education class in high school does pay off.

In fact, there is a lifetime benefit of roughly $100,000 per student from completing a one-semester course in personal finance, according to a recent report by consulting firm Tyton Partners and Next Gen Personal Finance, a nonprofit focused on providing financial education to middle and high school students.

Much of that financial value comes from learning how to avoid high-interest credit card debt and leveraging better credit scores to secure preferential borrowing rates for key expenses, such as insurance, auto loans and home mortgages, according to Tim Ranzetta, co-founder and CEO of Next Gen.

But then there is the ripple effect, he added.

“Students bring these lessons home,” Ranzetta said. “When you take that $100,000 in savings and multiply it across families and communities, it’s an incredible economic engine.”

“I get to show students the value of having a savings and checking account and then they are able to share that with their parents,” said Kerri Herrild, who has been teaching personal finance at De Pere High School in Wisconsin for 18 years, referring to what’s known as the “trickle up effect.”

“Getting this basic knowledge — that’s powerful,” she said.

Meanwhile, the trend toward in-school personal finance classes is gaining steam.

As of 2024, half of all states already require or are in the process of requiring high school students to take a personal finance course before graduating, according to the latest data from Next Gen.

In addition, there are another 35 personal finance education bills pending in 15 states, according to Next Gen’s bill tracker.

‘The research is overwhelming’

Many studies show there is a strong connection between financial literacy and financial well-being.

“The research is overwhelming,” Ranzetta said.

Students who are required to take personal finance courses starting from a young age are more likely to tap lower-cost loans and grants when it comes to paying for college and less likely to rely on private loans or high-interest credit cards, according to a study by Christiana Stoddard and Carly Urban for the National Endowment for Financial Education.

Students are also even more likely to enroll in college when they are aware of the financial resources available to help them pay for it.

“Our results show that high school financial education graduation requirements can significantly impact key student financial behaviors,” the authors said in the report.

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