2009 Outstanding AFCPE® Conference Paper Teachers' Background and Capacity to Teach Personal Finance: Results of a National Study
Way, Wendy L., Holden, Karen C., Journal of Financial Counseling and Planning
An on-line survey of K-12 teachers was conducted to determine teachers' background and capacity to teach personal finance. Results indicate that while teachers recognize the importance of teaching personal finance, few have had formal preparation for teaching this subject matter; also, the teaching of personal finance is highly concentrated by grade level and discipline. Teachers feel limited in preparedness in both subject matter and pedagogy, particularly in the more technical topic areas of risk management and insurance and saving and investing. Perceived preparation and prior personal finance background varies greatly among disciplines. Teachers also have concerns about their own personal financial well-being, especially future retirement income adequacy.
Key Words: financial literacy education, personal finance, teacher readiness
Financial literacy education has moved from being a largely private concern to a national public policy issue as it has become increasingly clear that individual financial decisions collectively affect the national economy. Uncertainty about the adequacy of retirement savings, rising debt levels, and personal bankruptcy are no longer financial issues to be addressed solely by individuals (Braunstein & Welch, 2002; Draut & Silva, 2004; O'Neill, 2006). The assumption that greater knowledge improves financial behavior has led to efforts, including state mandates, to expand financial education at the elementary, secondary, and postsecondary levels.1 Today, 80% of states have adopted personal finance education standards or guidelines of some kind; this is almost double the number of states (42%) that had such policies in 1998 (NCEE, 2007). An increasing array of educational program models, materials, and other resources are also now available for use in implementing financial education recommendations and mandates (Vitt, Reichbach, Kent, & Siegenthaler, 2005).
Despite this growing emphasis on financial education, little attention has been paid to understanding the characteristics and needs of the population that is pivotal to the implementation and success of personal finance education - the teachers. We found few studies that examined the extent to which prospective or practicing teachers are interested in or value personal finance subject matter. In a survey of Indiana K-12 teachers, McCormick (2005) did find a high level of agreement among teachers that financial education subject matter was important, with middle and high school teachers expressing greater support for teaching the subject than elementary teachers.
Only two studies were identified that examined prospective and practicing teachers' preparation in this area; both were conducted in the late 1970's. Garman (1979) examined the consumer education knowledge of graduating teacher education students, and Lofgren & Suzuki (1979) assessed the consumer education and personal finance knowledge of practicing teachers. Using a 55-item instrument based on the 1972 Illinois Guidelines for Consumer Education and a national sample, Garman (1979) found that overall newly certified teachers answered only about 60% of the questions correctly. Graduates were most knowledgeable about topics related to the purchase of certain goods and services in the marketplace and least knowledgeable about saving and investment (50% of items correct) and taxes (45% of items correct). No significant differences in knowledge were found in relation to students' socioeconomic background; however, male graduates had significantly higher scores than females, those certified to teach secondary education had higher scores than those in elementary education, and those who had taken a consumer education course in college had higher scores than those who had not. New graduates certified to teach social studies, science, and home economics had the highest knowledge scores while those prepared to teach special education, art/music, and physical education had the lowest. …