Personal Finanace

We do a terrible job teaching kids personal finance, but a new Texas program could be the answer

I’m weirdly excited about a financial literacy program called SmartPath rolling out this year in Texas schools for grades one through eight.

I often complain loudly, and to whoever will listen, that we — as a society — do a terrible job of teaching young people about personal finance.

You might catch me waving my arms and exclaiming, “Why don’t we teach this stuff in junior high? In high school? In college?” at otherwise perfectly nice cocktail parties — until the other person slowly backs away or looks awkwardly down at her phone while moving rapidly across the room toward a fresh drink.

Of course, many teachers and many schools do teach this stuff. It’s just that big barriers exist to making sure every kid actually knows what to do with their money when the time comes, like by age 18 or age 22.

So, about those barriers. We should acknowledge them.

As a noncore subject, personal finance and economics will always get a lower priority than reading, mathematics, science, history and foreign languages, with good reason.

Teachers themselves may not feel confident about teaching finance. It’s hard to teach what you’re not confident in.

At the classroom level, teachers are already overburdened with other curriculum mandates. If finance doesn’t naturally integrate with core subjects on standardized tests, there might not be enough time in the day.

But for all those reasonable barriers in the classroom, I’m still waving my arms madly at inappropriate times because every kid deserves to know the basics of their future finances. Certainly most families don’t know enough to pass on the right lessons.

Anyway, I spent some time recently learning from Susan Doty, director of the Center for Economic Education and Financial Literacy at UT Tyler, about a program she’s championing in Texas schools. She brought SmartPath to Texas schools in 2018 with the financial support of the Texas Banker’s Association.

I went through the grades one-five curriculums with Doty. You’ll all be relieved to know I did pretty well on the quiz parts, thank you very much.

With SmartPath, a classroom teacher typically presents the animated online program to an entire class. No one-on-one-kid-staring-at-electronic-device here. A teacher leads the group activity, then prompts the discussions, then returns to the narrative, then returns to the group for problem-solving. A full grade module takes about five hours. Long enough to dig into some grade-appropriate substance. Short enough to fit into an already packed semester.

A few great design elements stand out.

First, the program collects data on results of the program and aggregates it to measure effectiveness. All students take a pre-test and post-test for financial literacy.

Next, the program is 100 percent free to schools. In Texas, the Texas Bankers Association has funded an initial rollout and licensing fees for up to 250 teachers. In return, industry representatives typically get to attend a post-program party to hand out certificates.

Third, teachers are rewarded with $100 stipends for training on the program and upon completion of the pre- and post-tests. Doty believes this small incentive recognizes the additional effort of teachers to receive training in SmartPath, and to ensure completion and data collection.

The SmartPath funding model makes financial sense to me. Created by the nonprofit Economic Center at the University of Cincinnati, center director Julia Heath set out to develop SmartPath as a revenue-generating, self-sustaining program that charges a licensing fee to users nationwide.

As Heath told me, they’ve tried to align incentives to satisfy a bunch of important criteria:

1. Teachers get a stipend

2. Philanthropic contributors get branding recognition

3. The program collects data to measure effectiveness and make improvements

4. The program is self-sustaining through licensing fees.

For this to work best, Heath has designed the program so that state and regional champions like Doty work to find local business sponsors who can adopt the program locally. The national rollout seems to be going well, with Heath citing 22,000 teachers nationwide who have adopted SmartPath. Doty envisions a larger presence with more schools and more teachers in Texas by seeking additional regional sponsorships.

The data collection part, which I admire, seemed obvious and essential to Heath. As she told me, “I’m not going to go to a person with a big (philanthropic) ask without having the data that shows them ‘here’s what we did with your money.’”

Heath reports that students improve an average of 30 percent across all grade levels.

Both Doty and Health said teachers report more confidence in teaching the subject after leading the SmartPath program, which itself counts as a win.

As Mary Lange of the Texas Bankers Association told me, the first appeal of SmartPath is that “it’s very scalable, it’s online and it’s driven by the teachers.”

But just as importantly, she says, “It’s an accountable program, with measurable outcomes.”

By June 2019, once they have trained 250 teachers in Texas, Lange says, “we want to be able to evaluate what the teachers are saying, and what the students are saying.”

For all the focus on the program’s financial sustainability, Heath also allows parents and teachers to access and use the SmartPath program for free. Free access online — outside of the licensed version sponsored by the Texas Bankers Association — doesn’t include pre- and post-assessment tests and the teacher stipend. But, hey, free is a pretty good price, too.

In Texas, the curriculum co-sponsor of SmartPath is the Texas Council on Economic Education, on the board of which Doty serves. The council also sponsors longer-standing programs for teacher professional development in financial literacy as well as high school-level competitions such as The Stock Market Game, the Personal Finance Challenge and the National Economics Challenge.

Michael Taylor is a columnist for the San Antonio Express-News and author of “The Financial Rules For New College Graduates.”

michael@michaelthe smartmoney.com | twitter.com/michael_taylor

Source

neallesh@yahoo.co.uk

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.