A class on in­ter­est is fine; con­flict of in­ter­est isn’t

The Washington Post Sunday - - BUSINESS - Michelle Singletary

For many peo­ple, per­sonal fi­nance can be pretty bor­ing. I’ve even had folks plan­ning to at­tend a financial class tell me they an­tic­i­pated tak­ing a nap.

Folks like hav­ing money. They just don’t like the chore of learn­ing the con­cepts it takes to man­age it well. And if they aren’t learn­ing what they need to know, they prob­a­bly aren’t able to teach their chil­dren.

Many ad­vo­cates be­lieve teach­ing stu­dents about per­sonal fi­nance should be in­te­gral to the Com­mon Core cur­ricu­lum be­ing im­ple­mented na­tion­wide. Ac­cord­ing to the Coun­cil for Eco­nomic Ed­u­ca­tion, 17 states now re­quire high schools to pro­vide at least some in­struc­tion in per­sonal fi­nance.

But how can teach­ers make the lessons en­gag­ing enough so that they are not lost on the stu­dents? And how can ed­u­ca­tors be as­sured that the teach­ing ma­te­ri­als they use are free from bias and sub­tle sales pitches?

Last week, the Con­sumer Financial Pro­tec­tion Bureau re­leased a guide to help ed­u­ca­tors scru­ti­nize fi­nan­cial­lit­er­acy cour­ses.

“De­spite the grow­ing num­ber of states en­cour­ag­ing fi­nan­ciale­d­u­ca­tion in­struc­tion, most ed­u­ca­tors do not feel welle­quipped to meet this need,” the CFPB said.

Cham­plain Col­lege’s Cen­ter for Financial Lit­er­acy has

graded all 50 states and the Dis­trict of Columbia on their lev­els of per­sonal fi­nance in­struc­tion. Only five states — Alabama, Mis­souri, Ten­nessee, Utah and Vir­ginia — got an A.

Twenty-six states re­ceived a C, D or F. “Less than half were given grades that you would want your chil­dren to bring home from school,” the cen­ter said.

The dilemma for many schools has been that, with lim­ited pub­lic funds to cre­ate or buy financial-ed­u­ca­tion cour­ses and to hire teach­ers with the train­ing, they of­ten have to rely on free ma­te­rial either funded or pro­duced by fi­nan­cialser­vice com­pa­nies. They also have to find space in their sched­ule to teach the in­for­ma­tion.

That’s where the CFPB’s new re­view tool comes in. It’s meant to give financial-ed­u­ca­tion-course de­vel­op­ers and ed­u­ca­tors a frame­work, said Jan­neke Rat­cliffe, as­sis­tant di­rec­tor in the CFPB’s Of­fice of Financial Ed­u­ca­tion. It can be found at

www.con­sumer­fi­nance.gov; search for “Youth financial ed­u­ca­tion cur­ricu­lum re­view tool.”

One key com­po­nent aims to as­sess whether cour­ses are un­bi­ased. Al­though the tool cau­tions schools to be on the look­out for lessons that in­clude branded prod­ucts or that pro­mote spe­cific fi­nan­cialser­vice providers, I would love for it to search for even more po­ten­tial con­flicts of in­ter­est.

I go nuts when I see les­son plans that say get­ting a credit card can help stu­dents man­age their money. No, it doesn’t. It teaches them the ways of a debtor — even a good one — too early in life.

I’ve been look­ing for a strongly worded financial proper lit­er­acy course that aims to make skep­tics out of stu­dents. Ear­lier this year, I wrote about a cur­ricu­lum de­vel­oped by the Fool­Proof Foundation. If you’re an ed­u­ca­tor look­ing to vet a pro­gram us­ing the CFPB’s tool, I rec­om­mend go­ing to

www.fool­proofteacher.com. It’s such a com­plete pro­gram for teach­ers (even the grad­ing is done for them), and it clearly fa­vors the con­sumer pro­tec­tion of stu­dents. Too many of the ma­te­ri­als I see don’t note enough of the dan­gers of debt.

John Char­gois, the ju­nior class prin­ci­pal at Union High School in Tulsa, Okla., is also a fan of Fool­Proof. To grad­u­ate from a pub­lic high school in Ok­la­homa, stu­dents must show com­pe­tency in 14 ar­eas re­lated to financial lit­er­acy. Char­gois’ school re­quires all 3,200 of its stu­dents to go through Fool­Proof’s on­line cur­ricu­lum.

“The pro­gram is very user­friendly, and one of the ben­e­fits we saw was that the ma­te­rial is pre­sented by stu­dents,” he told me. “We felt our kids could re­late to the mes­sage. And through­out the en­tire pro­gram, one of the re­cur­ring themes is ‘be­ware.’ This is one of the most rel­e­vant cour­ses we teach.”

San­dra Deis­eroth, a busi­ness and mar­ket­ing teacher at Horse­heads High School in Horse­heads, New York, said Fool­Proof works hard to en­sure that its cur­ricu­lum meets ev­ery state’s stan­dards and Com­mon Core ini­tia­tives. “Though I con­tin­u­ally re­view fi­nan­cial­lit­er­acy pro­grams each year, it’s been a con­scious choice to use Fool­Proof for the past 10 years,” she said.

I vol­un­teer as a per­son­al­fi­nance teacher at pris­ons and at my church. Af­ter test­ing out Fool­Proof my­self, I’m plan­ning to adopt its cur­ricu­lum in my classes.

As schools eval­u­ate fi­nan­cial­lit­er­acy pro­grams, they need to be keenly aware that it’s not enough to ex­plain the me­chan­ics of how in­ter­est rates, in­vest­ing, check­books, stu­dent loans and credit cards work. We need to be send­ing our chil­dren through cour­ses that are free of any con­flicts of in­ter­est.

Write Singletary at The Wash­ing­ton Post, 1150 15th St. NW, Wash­ing­ton, D.C. 20071 or at michelle.singletary@wash­post.com. Ques­tions may be used in a fu­ture col­umn, with the writer’s name, un­less oth­er­wise re­quested. To read more, go to http://wapo.st/michelle-singletary.

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