This state has the best personal-finance education in the U.S. — you can tell by its average credit score

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Financial literacy is key to managing money, but how well are states preparing their students?

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Tennessee tops the list of US states that provide the best financial education for their residents, according to a new report good by financial-services company OneMain Financial. More than 99% of students in Tennessee’s public high schools attend what is known as a “gold-access” education, a school where they are required to take personal-finance courses in order to graduate.

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The OneMan Financial Report looks at four things for each state: the number of active bills promoting some kind of financial education in public schools, the state of financial education in public high schools, the level of proposed and required personal-finance education, and Share of high-school students in Gold-access schools.

New York, Utah, Alabama and Virginia followed Tennessee in the rankings. Although only 2% of New York’s high-school students are in gold-access schools, 11 financial and economic-education bills have been proposed in the state this year. In the other three states, more than 97% of students are in Gold-Access schools. (Tennessee, however, has a The poverty rate is higher than at least 30 other states.,

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,‘We think that understanding credit scores, along with budgeting, savings, loans and credit cards, can set people up for a lifetime of financial wellness.’,

Oneman Financial Report on Financial Literacy

“We think that understanding credit scores, along with budgeting, savings, loans and credit cards, can set people up for a lifetime of financial wellness,” OneMen Financial said in the report. “So we looked closely at the latest legislation and conversation about how we as a nation are doing to provide people with access to financial knowledge.”

Overall, elected officials had introduced 69 bills focused on financial education in 27 states by the end of October this year, according to Next Gen Personal Finance. Financial Education Bill Tracker, NGPF is a non-profit organization that aims to provide personal-financial education to all students. Out of those bills, 12 have been signed in 10 states and 8 are still in progress in 3 states.

Roughly two dozen states require students to learn about personal finance, either in a dedicated curriculum or integrated into other subjects, in order to graduate from high school. According to Council of Economic EducationReports of the Survey of States. Some states, including Florida, passed bills to make personal-finance courses an in-person requirement in the summer of 2022.

Alaska, Wyoming and the District of Columbia have seen no new bill requiring personal-finance education in K-12 schools, according to a Council for Economic Education report. California also has no such requirement, but the state passed a bill in July To form a statewide task force to look into the issue.

(OneMen Financial declined to offer an evaluation of the lowest-performing states in personal-finance education. However, the researchers noted that 68% of American high-school students do not understand credit scores and also that automobile loans rank after mortgages and student loans for the largest share of household debt among adults.)

Americans consistently do poorly in financial literacy survey

American adults have answered only 50% of personal-finance questions correctly in an annual survey of financial literacy over the past six years. 2022 report by the non-profit TIAA Institute and the Center of Excellence for Global Financial Literacy at The George Washington University.

Financial literacy is lowest among young Americans, according to TIAA Institute and GFLEC Personal Finance Index, a list of 28 key questions in the annual survey. On average, some 54% of Baby Boomers answer all questions correctly, while 42% of Generation Z respondents answer all questions correctly. Questions cover everything from saving, investing and borrowing to earning, consumption and understanding risk.

Financial-literacy levels have been “stubbornly resistant to progress,” according to analysts at the Milken Institute, a nonprofit think tank based in Santa Monica, California. “This result is particularly worrying for young people, who are more likely to face financial challenges than previous generations,” the researchers concluded. in 2021 report,

money management skills the wanted

Over the past two years, the pandemic prompted several states to consider the need for financial-literacy education in schools. The pandemic disrupted jobs and income for many households, especially low-income families. It appears that promoting financial education in schools has reaped rewards in Tennessee. The state’s average credit score has increased by 4 points to “good” FICO.
Last year score of 701.

Americans face an uncertain economic outlook. Although inflation was down from 8.2% in September, it stood at 7.7% in October from a year earlier, according to the latest government data. Growth in the cost of living finally showed some signs of cooling after inflation hit a 40-year high of nearly 9% a year ago this summer. However, high inflation has taken a toll on millions of already cash-strapped households.

Federal Reserve Vice Chairman Lael Brainard indicated earlier this month that the Fed could slow its rate of interest rate hikes. It has raised rates six times this year and raised the key rate by 0.75 percentage points in November for the fourth time. This pushed the short-term lending rate to the target range of 3.75% to 4%, making car loans and credit-card debt more expensive.

Consumers also reported dipping into their emergency savings to help cover monthly bills. At the same time, American households have become more reliant on credit cards and personal loans. Total bank credit-card balances are set to reach a record $866 billion in the third quarter of 2022, up 19% from a year earlier, according to TransUnion TRU.

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