Are Teachers Making The Grade in Personal Finance Education?

Study Reveals Need for Greater Focus on Teacher Training

A Closer Look: Greater Efforts Needed to Prepare Educators to Teach Personal Finance

  • Importance of Financial Literacy. Eighty-nine percent of teachers agree or strongly agree that students should take a financial literacy course or pass a test for high school graduation.
  • Current Teaching. Only 29 percent of teachers are teaching financial education in any way—in existing classes or special classes on finance topics. And fewer than 20 percent of teachers reported feeling “very competent” to teach any of the six personal finance topics surveyed.
  • Using State Standards. Nearly 64 percent of teachers feel not well qualified to use their state’s financial literacy standards. In fact, the study found no influence of state mandates on whether a teacher had taken a course in personal finance, taught a course, or felt competent to teach a course.
  • Teacher Education Faculty. Teacher education faculty felt no more competent to teach specific financial concepts than did K-12 teachers, and they were not more familiar with state financial education standards.

Date: April 16, 2009

Contact: Paul Golden 303-224-3514, [email protected]

DENVER—While 89 percent of K-12 teachers agree that students should either take a financial education course or pass a competency test for high school graduation, relatively few teachers believe they are adequately prepared to teach personal finance topics. But in order to advance life-skill learning, many teachers would welcome more learning opportunities in both financial education subjects and teaching methods.

University of Wisconsin-Madison researchers Wendy L. Way, Ph.D., and Karen Holden, Ph.D., surveyed more than 1,200 K-12 teachers, students currently enrolled in teacher education programs, and university teacher education faculty to better understand their training and education in personal finance, their opinions about the importance of financial education, and their capacity to teach these topics. The study, Teachers’ Background & Capacity to Teach Personal Finance, was funded by the National Endowment for Financial Education.

Strengthening College Curriculums

Having taken a personal finance course for credit is an important predictor of teaching personal finance, the researchers found. And further, teachers who had taken a college course with financial education-related topics were 50 percent more likely to rate themselves as competent to teach financial literacy subject-matter. Yet interestingly, today’s prospective teachers are no more likely to have taken a course in financial education than teachers who have completed their degrees many years earlier.

“This study reinforces the need to incorporate personal money management topics into educational opportunities for teachers, whether in undergraduate or graduate curricula for students studying to become teachers, or as post-graduate or in-service courses or workshops,” says Ted Beck, president and CEO of NEFE. “We have an opportunity to dramatically affect the quality of K-12 financial education by providing teachers with the subject matter expertise they need throughout their careers.”

Comfort Level with Financial Topics and Teaching Methods

To gain a sense of teachers’ perceptions of their own preparedness to teach, survey respondents were asked how competent they felt to teach specific topics included in educational standards such as those identified by the Jump$tart Coalition (2007) and in the NEFE High School Financial Planning Program® (HSFPP) (2007). The study surveyed teachers on six personal finance areas: income and careers, planning and money management, credit and debt, financial responsibility and decision making, saving and investing, and risk management and insurance.

Relatively few teachers reported feeling “very competent” in any of the six topic areas. Teachers felt most competent to teach in the content areas of income and careers, and in planning and money management, but even for these topics fewer than 20 percent reported feeling “very competent.”

“Just having a solid background in financial content isn’t enough,” says Way. “Teachers also need help with financial education pedagogy, such as designing curriculum, assessing learner needs, and employing educational strategies.”

More than half of the respondents reported needing help in these areas.

“The good news is that there is a small core of teachers who do feel competent to teach personal finance,” Way continues. “Identifying the factors that built their confidence will help educators understand how to increase the number of teachers in that core.”

Teachers’ Background

Only 37 percent of K-12 teachers had taken a college course offering personal finance content. The study found that having taken a college course in personal finance is a major predictor of teachers feeling competent to teach personal finance.

Because a certification or specific training to teach financial education currently does not exist in most regions, teachers of family living, business education, and social studies, (where personal finance traditionally is taught) are the ones most commonly teaching it today. However, math teachers, who are less likely than teachers in these fields to have taken personal finance courses, are also incorporating financial examples in their teaching. Most teachers engaged in providing financial education report that they integrate financial education topics into regularly offered credit courses, rather than offering separate, stand-alone courses.

The study showed that K-12 teachers and prospective teachers are acquiring very little additional formal education in personal finance, either through credit-based courses or non-credit offerings. In addition, only a few teachers and a handful of prospective teachers had completed any formal course work in educational methods for teaching financial education. Only 11.6 percent of K-12 teachers had taken a workshop on teaching personal finance.

Not surprisingly, survey respondents expressed openness to getting help with subject matter and pedagogy for personal finance. More than 70 percent of K-12 teachers indicated they were willing to participate in formal financial education training. Areas for which teachers felt least prepared were risk management and insurance, saving and investment, financial responsibility and decision making, and credit and debt. Survey respondents also want help with teaching methods.

“Our research shows that teachers are open to integrating financial education into their curriculum. But they need help with tailoring the content to their discipline,” says Holden. “Helping teachers learn how to include financial literacy concepts into other disciplines—such as math, consumer education, or language arts—is a way to expand financial education throughout the curriculum.”

State Standards

Today, 44 states have adopted personal financial education standards or guidelines (according to the Council on Economic Education 2009 Survey of the States). Given this growth in support for financial education, researchers Way and Holden expected that these educational policies would have some influence on whether teachers had taken or taught a course related to financial education, or felt competent to teach these topic areas.

However, the study found no influence of state mandates on whether a teacher had taken a course in personal finance, taught a course, or felt competent to teach a course. In fact, over 60 percent of teachers and prospective teachers said they do not feel qualified to teach their state’s financial education standards. And teacher education faculty in those states were no more familiar with state financial education standards than K-12 teachers themselves.

“This lack of influence of state mandates on teacher education implies that there are a lot of opportunities for improvement in the financial education we provide both pre-service and in-service teachers to meet their personal and professional needs,” says Way.

As states increasingly call for more attention to curricula and/or testing in personal finance, the data suggest that much work needs to be done to ensure that these standards are incorporated into the curriculum for prospective teachers and that K-12 teachers get the training they need to use the standards.

For an executive summary or to read the complete Teachers’ Background & Capacity to Teach Personal Finance study, click here.


Paul Golden
National Endowment for Financial Education (NEFE)
[email protected]

Wendy Way, Ph.D.
University of Wisconsin-Madison
[email protected]

Karen Holden, Ph.D.
University of Wisconsin-Madison
[email protected]



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