California High Schools to Mandate Financial Literacy Course for Graduation

In a bid to equip Gen Z with essential financial management skills, California has passed a bill requiring all high school students to complete a personal finance course before graduating. The move aligns with mounting concerns about the financial literacy gap among young Americans.

In a proactive move to empower Gen Z with crucial financial management skills, California has passed Assembly Bill 2927, requiring all high school students to complete a semester-long personal finance course before graduating. This groundbreaking legislation, sponsored by Democratic State Rep. Kevin McCarty and co-authored by a bipartisan group of lawmakers, will take effect for students graduating in the class of 2030-2031.

Recognizing the paramount importance of financial literacy for young adults navigating the complexities of modern life, Governor Gavin Newsom hailed the bill's passage. "We need to help Californians prepare for their financial futures as early as possible," Newsom asserted. "Saving for the future, making investments, and spending wisely are lifelong skills that young adults need to learn before they start their careers, not after."

California High Schools to Mandate Financial Literacy Course for Graduation

The mandate underscores the pressing need to address the alarming financial literacy gap among Gen Z, as evidenced by several recent surveys. A WalletHub survey revealed that Gen Z is the least financially confident generation, with a staggering 28% expressing a lack of confidence in their ability to manage money, alongside a dearth of budgeting practices and skepticism about homeownership prospects.

Another survey conducted by EverFi corroborated these concerns, finding that only 10% of high school students felt "prepared" or "very prepared" to ascertain the full costs of their college education. A meager 49% believed they could confidently complete the Free Application for Federal Student Aid (FAFSA), while just 33% felt equipped to decipher loan offers.

California High Schools to Mandate Financial Literacy Course for Graduation

Furthermore, less than half of the high school students surveyed professed confidence in understanding paychecks or managing savings and checking accounts.

"We need to help Californians prepare for their financial futures as early as possible. Saving for the future, making investments, and spending wisely are lifelong skills that young adults need to learn before they start their careers, not after."

California High Schools to Mandate Financial Literacy Course for Graduation

The legislation's passage is a testament to the collaborative efforts of Newsom, Senate President Pro Tempore Mike McGuire, Assembly Speaker Robert Rivas, and NGPF Mission 2030, a national nonprofit dedicated to promoting financial literacy.

"I'm thrilled to know that this legislation will be signed into law," said McCarty, the bill's lead author. "I'm proud to have played a role in helping students make smart money decisions that will benefit them throughout their adult lives."

California High Schools to Mandate Financial Literacy Course for Graduation

The impending curriculum will encompass core financial literacy concepts, including budgeting, investing, saving, understanding credit and loans, and managing risk. By equipping students with this foundational knowledge, California hopes to empower them to make informed financial decisions, manage their finances effectively, and thrive financially.