dapper in a blue shirt and striped tie, 11-year-old
Quinn Krueger leaned over his desk and peered at plans
for his companyís next project ó a park bench.
was CEO of the only construction firm in BizTown, a
simulated city at Junior Achievement in Maplewood,
Minn., where fourth- and fifth-graders spend a day
learning to run a business, work for a boss, write a
check, pay taxes and do payroll.
selling the bench for $75," Krueger said. "Weíre
kids zipping back and forth and bemused parents and
teachers looking on, the program is among the more
elaborate attempts to teach children to become
is holy month for the financial literacy movement that
has swept the nation in the past decade, as state and
federal government, nonprofits and financial firms
launch town hall meetings, task forces, fairs, forums,
quiz bowls and high school visits.
is, however, a problem with this well-intentioned effort
to teach youngsters personal finance: Educators havenít
found an approach that clearly works.
wish it werenít true, but it is," said Lauren
Willis, a professor at Loyola Law School in Los Angeles
who has published several papers on the subject.
"Math matters, but these financial education
programs do not."
research has shown that classroom personal finance
instruction does not translate into financial literacy
or wiser financial decisions. Students donít remember
what they learn, and the lessons become outdated too
said programs that get students to interact with the
material can work better. Thatís the idea with BizTown,
as well as a program Junior Achievement runs that lets
ninth-graders compete in a computer business simulation.
experiential model is really what sets Junior
Achievement apart," said Gina Blayney, president of
Junior Achievement of the Upper Midwest. "We put
them into a competitive environment."
models that have been successful include cooperation
from parents, and giving students the skills to find and
analyze information on their own.
while few would dispute that too many American high
school graduates lack the skills to navigate their
finances, many experts argue that financial literacy
education has more work to do to remedy the problem.
Jump$tart Coalition, a group thatís been widely
credited with popularizing financial literacy training
and pushing April as a month to emphasize it, was formed
in late 1996 by a coalition that included banking and
credit card industry groups, the Federal Reserve Board,
the National Council on Economic Education and Junior
Achievement, among others.
economy was growing, the stock market was doing well and
yet bankruptcies were on the rise, said Lewis Mandell,
an economist involved from the beginning.
developed the coalitionís survey that measured the
financial knowledge of high school students. To no oneís
surprise, American teenagers came up wanting. The
solution, the coalition decided, was to teach them more
about personal finance. The group thought it would be a
felt that in 10 years, the problem would go away,"
said Mandell, a professor emeritus at the State
University of New York-Buffalo. "Everyone would
take the course in high school, and there wouldnít be
that problem any longer."
2000, Mandell started asking students he surveyed
whether they had taken a semester course related to
personal finance, to see if those who had were answering
more questions correctly than their peers. The results
was zero difference," Mandell said. "We did
this for five separate national studies of high school
seniors, and we found no difference."
college students, those who had taken a high school
class did no better than those who had not. Even college
classes in personal finance, business and economics
failed to register a statistical benefit. Instead, what
predicted smart financial decisions was analytical
skills and problem-solving ability. Engineering and
science majors performed the best.
have not found an effective way to teach financial
literacy in the classroom, but they have learned a few
things. Games and competition help. So do basic skills
on how to find information, and so do parents.
anything, if itís not reinforced at home, it goes out
the window," said Joanne Kuster, a personal finance
speaker and blogger based in Iowa.
Financial makes a point to train children along with
their parents, to help reinforce the lessons. Mary
Vandehey, who oversees financial education for Thrivent
members, said the company held 2,000 financial workshops
for parents, teens and younger children in 2012, and
32,000 people attended.
parents are able to talk openly about finances, their
children tend to have a stronger foundation and a better
understanding," Vandehey said. "Weíre
hitting an audience, but we still have lots of work to
Krueger and his classmates spent a month and a half
preparing for their visit to BizTown. They looked at
classified ads, applied for jobs, and had to dress up
for formal job interviews. "They were all
super-nervous," said Lynn Schwieters, a teacher at
Valley Crossing School in Woodbury, Minn.
kids applied to be the radio station DJ, but only one
boy got the job. Others landed jobs in the cafe, as a
CFO, as mayor or as the guy who reads utility meters.
cool for them to experience real life," Schwieters
said. "Getting a paycheck, going to the bank,
realizing that the money doesnít come from
students were slated to spend half the day at BizTown,
and they threw themselves into the jobs. Across the
hall, ninth-graders from Mounds View High School huddled
around computers as they competed with each other to
have the most profitable business. Each team of three or
four students controlled the price of their product,
inventory and budgets for charitable donations,
marketing, and research and development. They made
decisions together on the fly and got regular updates on
who was winning.
many ninth-graders do you know who are talking about
research and development?" said Jon Nuss, who
teaches economics at Mounds View. "Right now weíre
in our business unit. A lot of the stuff we talk about
fits right in with this game."
even games donít translate into measurable improvement
in financial behavior, said Willis, the law professor at
games seem to show some positive learning, but (the
students) donít engage in any better behavior,"
factors that lead to wise financial behavior are
self-control and basic math skills, she said. Also, she
said, the idea that financial literacy is the key to
navigating a rapidly changing financial marketplace
distracts attention from the fact that many financial
products are so complex they arenít even understood by
idea that itís providing people freedom?" she
said. "Yeah, itís this perverse notion of
freedom, to force people to try to figure this out and
then blame them when they canít. Itís really a