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Cascade: No. 61, Spring 2006

Educators Teach Children to Be Financially Savvy

Editor’s Note: Andrew Hill was named chairperson of the Federal Reserve System’s economic educators’ group in January 2006.

One of the most important contributions that our society can make to asset building is to ensure that our young people graduate from high school with a sound understanding of personal finance. At the Fed, we believe that students who have had education in personal finance throughout their K-12 experience or in high school will be better asset builders in later years.

With the urgent need to help young people become more knowledgeable about personal-finance issues, in the 2001–02 school year the Philadelphia Fed, in partnership with the University of Delaware Center for Economic Education and Entrepreneurship, the Delaware Bankers Association, and the Consumer Credit Counseling Service of Maryland and Delaware, began to develop a high school personal finance course. The Keys to Financial Success course,1 which started in one school in 2001, is being used in 43 high schools in the 2005–06 school year. This school year, the Keys course is being offered by three high schools in New Jersey, 14 in Pennsylvania, and 26 in Delaware. Many of these schools are located in low- and moderate-income communities, including several in Camden, Philadelphia, Atlantic City, and Wilmington.

Designed by the nationally recognized University of Delaware Center for Economic Education and Entrepreneurship, the Keys course includes five units: future financial goals and the decision-making process; career planning and investments in human capital; money management; consumer skills; and risk protection. Students learn important life skills, such as budgeting, saving, borrowing, and investing. The program provides high schools with a fast, cost-effective way to begin to offer a semester personal finance elective.

The Reserve Bank and its partners provide, without charge to participants, the curriculum materials, a week’s training for the teacher, pre- and post-testing of the students, and semi-annual follow-up training programs. The school is responsible for providing the teacher, classroom, and photocopying. Rather than use expensive textbooks, the students assemble their own portfolios from handouts provided by the teacher from the course materials. At the end of the semester, the portfolios are a handy reference as the students go off to college and the world of work.

The Keys to Financial Success model has been a hit with schools. The program’s low implementation costs mean that schools have fewer obstacles to adopting the Keys model than those associated with a traditional textbook-centered course. The Keys lessons rely heavily on active-learning techniques that get students involved in the learning experience. Many parts of the course require students to work collaboratively in groups. Evidence in the education literature suggests that courses that use active and collaborative learning are more effective than “chalk and talk” classes. Anecdotal evidence from a number of semesters of pre- and post-testing associated with the Keys program points to significant increases in students’ financial literacy as a result of the course.2

Community leaders, government officials, and bankers can encourage high schools they currently partner with to consider using the program.

For information about the Keys program in Delaware, contact Barbara Emery, program coordinator, University of Delaware Center for Economic Education and Entrepreneurship at emeryb@lerner.udel.edu. For information about the Keys program in Pennsylvania and New Jersey, contact Todd Zartman, economic education analyst, Federal Reserve Bank of Philadelphia at todd.zartman@phil.frb.org.

  • 1 Development of the course was discussed in the Summer/Fall 2001 issue of Cascade, and an update was provided in the Summer/Fall 2003 issue.
  • 2 Accurate measurement of the effects of the Keys course would require extensive information about each student’s socioeconomic background, a control group, and follow-up surveying of the students over a number of years.