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Now that Linda McMahon is leading the Department of Education—for however short of time she might be—she is prioritizing a vision focused on parental control, core subjects, and aligning postsecondary education with workforce needs. But if she’s serious about meaningful reform, there’s one more essential element she should add to that list: financial literacy standards.
If you Google “why schools don’t teach personal finance,” the top response is: “We don’t have enough instructors to teach finance classes.” While that may be true, I believe there are darker reasons at play. For one, it wouldn’t benefit America’s major corporations to have a financially literate population. In fact, financial institutions profit immensely by cloaking their products in confusing language. (Watch The Big Short for insight into this.)
Do I have direct proof that financial institutions lobby against financial education? Not yet; I am digging it up. But when financial products are wrapped in complexity and confusion, it’s hard not to suspect that the lack of financial literacy is intentional. Take the shift from pensions to 401(k)s in the 1980s, for example. This wasn’t a transition to a better retirement option—it was a strategic move by corporations to cut pension programs and shift the burden of retirement planning onto individuals. The name “401(k)” itself is confusing, buried in convoluted benefits packages, and the program is notoriously difficult to navigate. Many workers don’t even have access to it because their employers don’t offer it, and even fewer understand how to contribute strategically. And the system really only benefits high-income earners, who have the disposable income to invest throughout their careers.
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Now, whether a similar scheme is shaping school curricula, I can’t say for sure. But one thing is clear: the lack of federal financial education standards is playing a huge role in America’s widespread financial illiteracy.
In May 2024, I reported on a 2023 study by the Center for Financial Literacy at Champlain College, which found that only seven states earned an “A” for requiring a semester-long personal finance course. Meanwhile, California and Washington, D.C. got an “F” for their minimal financial education requirements. That might explain why Washington, D.C. leads the U.S. in average federal student loan debt at $54,795 per borrower, with the highest share of borrowers—17.2 percent of residents in debt.
States could reform their education systems to include financial literacy, but whenever reforms are on the table, there are always fools who stand in the way. Morgan Polikoff is one such fool. She opposed the California Personal Finance Education Initiative—a measure on the November 2024 ballot that would require high schools to offer and students to take a semester-long personal finance course. Polikoff argued:
While we might all like financial literacy, it’s not hard to imagine future ballot initiatives that try to change curricula in ways we might not like. Referendums could strip race- and LGBT-related content from the curriculum, mandate abstinence-focused sex education, or ban environmental content in science classes.
No, we can’t pass financial literacy because it might threaten the ability to teach about LGBTQ issues?! That makes sense.
Despite the fear that LGBTQ issues would fade from the California curriculum, the California Personal Finance Education Initiative ultimately passed. However, in the 2023-2024 legislative session, 12 other states had financial literacy on the table, and none passed it as a requirement:
New Mexico changed its graduation requirements but failed to include financial literacy. Oklahoma passed a bill that strengthened its financial literacy course requirements but did not include a full graduation requirement. Alaska and Washington introduced legislation for a semester course in financial literacy but neither passed. New York introduced legislation but is taking an alternative path to a requirement. Additional states that introduced legislation that either failed or is still in progress are Delaware, Hawaii, Illinois, Maine, Massachusetts, New Jersey, and Vermont.
Financial illiteracy “starts in primary and secondary education, which is completely dominated by the teachers’ union and its adversarial posture toward economics and finance,” Matthew Andersson, a corporate founder and former CEO of a Fortune 100 company, tells me. But higher education plays a role too. According to EBSCO, over 40 percent of college students lack adequate financial literacy, which is unsurprising given the K-12 gap. What’s surprising, though, is that financial ignorance seems to extend even to business and finance professors.
Should we require financial education in schools?
— Jared Gould (@J_Gould_) March 6, 2025
When I enrolled in an MBA program at Mississippi College during COVID-19, I expected to learn practical skills like how to open an LLC, raise money, or invest. Instead, I was bombarded with courses on leveraging debt and readings from an accounting professor who called certain types of debt assets—which they are not. I dropped the program, realizing it would teach me nothing more than how to boost my credit score, a number that judges your ability to manage debt, not make money.
I should’ve expected no more from the program. After all, I had been a longtime listener to Dave Ramsey—who, admittedly, seems more out of touch these days—who often routinely pointed out on his show that all his finance professors were broke.
Andersson told me that “much of this problem stems from faculty culture:
The academy’s economic literacy is generally limited by its compensation system, which is wage-based. It does not utilize other forms of corporate finance, such as incentive compensation based on performance, and, especially, contains no true at-risk features, such as phantom stock, which tracks cost efficiency, labor utilization rates, and research commercialization. Moreover, faculty wage labor either mimics or consists of collective bargaining methods, which pit labor against management and lead to a counterproductive relationship with the tools of wealth creation, which are based on long-term risk exposure and capital investment. This behavioral finance bias flows directly down to students, including graduate Ph.D. candidates, who generally mirror faculty behavior and seek union representation for wage enhancement. They rarely perceive the utility of modern finance, including concepts of present value, opportunity cost, payback, discounting, portfolio theory, or margin, which would greatly support their research proposals and competitive outcomes.
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What Andersson is saying is that professors, paid through fixed salaries and disconnected from the real financial world—like performance-based pay or taking risks—teach outdated financial concepts. As a result, students miss out on key skills for managing money, making smart investments, and understanding how business and finance truly work. This leaves graduates ill-prepared for modern finance.
The consequence? The student debt crisis, skyrocketing credit card debt, and the fact that the average American can’t afford a $500 emergency. In the wealthiest country on earth, millions are one paycheck away from losing everything. Isn’t that sad?
So, what’s the solution?
Require financial education in schools. Students don’t have to remain in the dark; we can give them the tools they need to succeed. The kids don’t know money; help them by implementing financial literacy requirements.
With perseverance, onto this week’s articles.
Follow Jared Gould on X.
Image by Nathan Dumlao on Unsplash
