As of 2025, the U.S. has amassed approximately $37.64 trillion in debt, of which about 80% is held by the public.
While many factors contribute to the growing national debt, one of the most important is the lack of financial education in schools across the country.
Financial literacy is the ability to understand and make financial decisions, including borrowing, investing, budgeting, and more. It is crucial to understand finances going into adulthood; however, personal finances are not included in standard curricula.
Rather than incorporating practical skills such as filing taxes or investing, many children continue to learn traditional arithmetic and writing conventions. While these fundamental subjects remain important, financial literacy is a vital step in setting people up for success.
According to a study by the Pew Research Center, while learning about personal finances from family and friends is the most common channel of knowledge across all demographics, lower-income individuals are more likely to have learned about personal finances in K-12 schools than any other income group.
Essentially, lower-income individuals depend more on school for financial education, rather than having access to financial advice from those around them. Because public schools do not prioritize personal finances in curricula, the access and quality of financial resources decline. As a result, different demographics have varying access to financial education, making it more difficult to gain knowledge that is vital for adulthood.
Further, financial education has been linked to wealth accumulation, suggesting that those with access to more financial resources have an advantage over those who don’t.
According to a study from the American Economic Review, financial education enhances the likelihood of an individual contributing to their pension, suggesting that financial literacy can build household net wealth. In the study, total net wealth accumulation was measured in terms of factors such as pension contributions and net housing wealth.
Considering that high-income individuals have access to more resources and are often more financially literate than low-income individuals, the knowledge gap creates a self-perpetuating cycle in which wealth and poverty are reinforced over generations.
To effectively address this issue, it is important to start at the root: unequal access to financial resources and education. Therefore, the integration of financial literacy education into school curricula is necessary and essential.
In California, schools are beginning to integrate personal financial literacy into their curricula following the passing of Assembly Bill (AB) 2927, mandating students to complete a semester-long personal finance course as a graduation requirement.
However, because of the widespread impact of this issue, it is vital that personal finance is made a priority across the country.
Financial literacy creates opportunity for improved well-being and life preparedness, making widespread accessibility a critical next step in reducing educational inequalities.
This editorial reflects the views of the Editorial Board and was written by Emi Pajarillo. The Editorial Board voted 12 in agreement, 2 somewhat in agreement, and 3 refrained from voting.
