I’ll never forget the day I went to speak at a university 12 years ago about the importance of financial education. It was during student orientation, where brand new freshmen were being introduced to college life and what they would expect for their next four years. As I walked to the ballroom where I was to give the speech, I saw a group of credit card companies lined up table after table, ready to register hundreds of young students as new carriers of credit cards.
During the forum, I asked the college students in the audience, “How many of you just signed up for your first credit card?” Dozens of hands went up. Then I asked, “How many of you have ever taken a financial education class in your high school?” Not one hand went up.
This eye-opening experience occurred more than a decade ago. And the situation has not improved. Consider the following statistics:
• Outstanding student loan debt stands at $1.6 trillion, up from $1.52 trillion the previous year.
• Only 41% of adults in the United States have a budget and keep track of their spending.
• Of millennials ages 18-34, one in eight individuals has debts in collections.
• 39% of millennial women don't pay their bills on time and are twice as likely than millennial men to take out a high interest loan to cover a $2,000 emergency.
• A record 7 million Americans are three months behind in their car payments.
This trend is troubling. As Arizona’s newly-elected State Treasurer, advocating for financial education will be a cornerstone of my administration. Young students who have never learned about managing their money are likely to become adults who fall into the cycle of debt.
As State Treasurer, I am committed to changing this situation for the better. Within the first few weeks of my administration, I advanced a financial literacy bill, S.B. 1184, introduced in the Arizona Senate, ensuring that Arizona students receive financial education and personal financial management as a requirement in their economics class before they graduate from high school.
Over the years, Arizona has not had a statewide requirement for students to be able to acquire personal financial management before they graduated from high school. If such a class had been offered, it was an elective class. How many teenagers do you know who would choose financial education over, say, golf?
This past legislative session, S.B. 1184 passed with wide, bipartisan support by the Legislature and was signed into law by Governor Doug Ducey on April 11. The new law will be implemented starting in the next school year.
Finally, Arizona students will be prepared to manage their money before going out into the world as adults. They will have the opportunity to be taught these basic life skills of balancing their checkbook and understanding the consequences of not paying off credit card debt month-to-month. With financial education, we can empower young people to achieve financial freedom so they can attain their personal and professional goals.
Our state and national economies depend on this. Our children deserve nothing less.