This bill will increase the financial literacy of thousands of military children.

Many young people are woefully unprepared to manage their personal finances. One approach to solving what some are calling the financial literacy crisis is to supplement the education American children are already receiving. Implementation of financial literacy programs is typically left to states, but one House bill would mandate such programs in Department of Defense schools and provide financial education to tens of thousands of students.

failing financially

Financial illiteracy costs Americans and their families dearly. The International Federation of Accountants estimates that lack of personal finance knowledge costs American adults nearly $500 billion each year. So how do we improve financial literacy in a country where nearly two-thirds of adults fail a basic financial literacy test? Some say it starts at school.

There is no federal mandate requiring public schools to teach financial education concepts. Decisions about what and how to teach in public schools are largely made by each state. And although more states are recognizing the long-term benefits of personal finance education, support for school financial education is disconnected at best.

However, the recent push to introduce personal finance classes in many states has been gaining momentum as understanding of the benefits of the curriculum grows. So, are financial education classes being introduced to high schools across the country? That seems increasingly likely with each state putting personal finances in the classroom.

What’s on the bill?

Riding the momentum supporting financial literacy in schools is a short piece of legislation that could have far-reaching implications at home and abroad. The Department of Defense Student Financial Literacy Act adds personal finance requirements to the Department of Defense Educational Activities (DODEA) system.

A quick read of the bill would add a requirement that students complete a “dedicated curriculum in financial literacy” before graduating from a DODEA school. What that process might include is open to interpretation given the current state of the bill, but such a process would likely cover basic concepts such as budgeting, saving money and debt management. The personal finance curriculum designed by DODEA could provide a useful template for states seeking to introduce their own financial literacy programs.

DODEA schools provide quality education to military families no matter where they are stationed. The DODEA system provides K-12 education to approximately 66,000 students in 160 schools across 11 foreign countries, seven states, and several U.S. territories. With a reputation as one of the best school systems in the country, the DODEA program could have a significant impact on the conversation surrounding financial literacy in education.

What’s next?

This bill was submitted to the House of Representatives last year and then referred to the Armed Services Committee and the Education and Labor Committee. These committees will continue to shape the bill, adding clearer definitions of the learning processes that will be required if the bill becomes law. However, there are many hurdles to overcome before the bill is passed.

Turbulence in the House could prevent any action on the bill, let alone a floor vote, before the legislative session expires. But the bill has broad bipartisan support, with 19 cosponsors representing voters across the country. Even if the bill fails to pass the 118th Congress, lawmakers clearly have a desire to acquire financial literacy in the classroom.

Some states have introduced personal finance classes into their curriculum, but the financial literacy movement is not uniform across the country. The Department of Defense Student Financial Literacy Act could further that cause by introducing these curricula to highly regarded DODEA schools. The bill’s political future is unclear, but representatives from both parties have expressed support.

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