Texas Financial Literacy Standards and Mandates

https://capitol.texas.gov/tlodocs/87R/billtext/pdf/SB01063F.pdf
https://statutes.capitol.texas.gov/Docs/ED/htm/ED.28.htm#28.025
https://tea.texas.gov/system/files/personal-financial-literacy-and-economics-frequently-asked-questions_0.pdf

Thank you for joining me here today as I review Texas Financial Literacy Bill 1063. Now this was enacted back in 2022. So it’s been a few years since it’s been in existence. And I’m going to do a review of the band-aids and what it means for the youth here going through the school system. As a Texas resident, love Texas the people I even like the hot weather in the summer I love the food I love the activities to do but I do not like this bill there’s a lot of loopholes there’s a lot of problems and it’s doing a huge disservice for the kids of the state now for those that have seen my other reviews of other states you realize I’m very critical of the state standards. And my goal is to elevate these so every student graduates with the ability to confidently make near-term financial decisions so they don’t get into financial problems like many of us face when we went out on our own on the first time, myself included. So my end goal is for the youth I also say for those that have led the charge to push these bills, I know it’s a challenge. I know it’s tough. I’m appreciative of your efforts, but this is going to be a critical review. There’s very little I like about this bill, and let’s get into the details here right now. For those that want to follow along, we will put the link to the bill in the show notes. In addition, you can look up SB number 1063 and see that. I’m going to start on page two as page one. It’s kind of fluff, you know, but page two, line item, the first area, line item one. Let’s add this to the thing here. Every student will be required to take at least a half credit in economics or personal financial literacy and economics. So two problems here right off the bat. Number one, it’s not required. It’s not mandated. It’s an elective. They could take economics or financial literacy with economics in there. If we go down the page a little bit to line item 18, two-thirds of the instruction time, if they choose the second option, is dedicated to financial literacy, whereas one-third is dedicated to economics. So even in this the youth are only getting about 40-ish, maybe 30, 40 hours of financial education. Not enough time, not enough rigor, major problem there. And in talking with, we have another major problem because in talking with teachers out here, they’re confused at what they should be doing. The Texas Education Agency has failed to do any housekeeping online. So when you look up Texas financial literacy bill, you’re going to see a lot of old material. And I’ve spoken with teachers who are using the old standards and old materials. So this just on the front page of Google, they have materials from their bill back in 2012. So they’re getting confused there. In addition, their old administrative code back in 2016, it lists topics that are not mentioned in this new bill. So a lot of confusion amongst teachers and the agency can do simple housekeeping to make it easier for teachers to locate. So there’s confusion there. In addition, the other problem, most of the teachers that are doing this that I’ve spoken to come from economics, right? They’re economics teachers. And now they’re told they have to make two-thirds of their class focused on financial literacy. So when you have a teacher that’s very confident in teaching a subject, they’ve been teaching economics for a handful dozen, maybe 20 plus years, and you’re telling them to interject a new subject in there, there’s problems. One, they feel more confident in teaching economics. So maybe instead of doing two-thirds personal finance, they’re doing maybe half personal finance and half economics, right? Because they’re more comfortable there. Or maybe they don’t want to develop the lesson plans and they get upset and confused because there’s a lot of old information online that doesn’t make it easy for educators to locate. So when you have a non-standalone class and you’re giving the teachers the idea on when that cutoff is and they’re comfortable teaching other subject matter, oftentimes the new subject matter gets cannibalized and very little instruction is done. So eating into that 30, 40 hours that should be dedicated to financial literacy, that’s a big problem. And again, there’s some simple things that we can do to address that. But bottom line, 30 to 40 hours of financial literacy education is absolutely not enough. If you try speaking a foreign language or learning advanced math or doing anything, after 30, 40 hours of instruction, let alone personal financial literacy, which is a very comprehensive subject matter. Moving on. So we’ll go to the next one I had a big problem with here, which is line item 23, stolen page two, line item 23. The agency shall develop a list of free and open source publicly available curriculum to be used in the school district in their personal financial literacy and economics course that satisfies the curriculum requirements. What’s the problem here? Every other subject, they’re purchasing high-quality curriculum. They’re not using free open source stuff they find online. They’re purchasing quality curriculum for math, science, English. That’s what they do. That’s what schools should be doing. And when you have free and open source, now I’m all for that. It’s a wonderful thing. I think they should do that. But when you have free, there’s often competing interest, right? You have government agencies producing free and open source curriculum that may have some biases included, right? You have financial service institutions that are producing free and open source because they’re looking to build relationships with potential future clients. So there’s some biases when you’re utilizing that type of curriculum. Why isn’t personal finance taught like other subjects? Where they’re purchasing high-quality curriculum that’s been vetted and shown to make a lasting difference in students’ lives? So why is the subject treated differently? That’s a problem. There’s plenty of funding to pay for that. I know my property tax bill, the majority of that goes toward schools. I pay a lot of property tax and there’s a lot of money to go around and they need to invest into the subject I feel is most important for youth, which is money management and learning outcomes about money. So big problem there. I don’t know why again, they’re treating this differently than other classes. But that is a major, major issue. So that is the SB 1063 bill. There’s some other things to talk about funding. Now they’re open to funding from private public sources, which is okay. And from my understanding, they are getting their funding from the economics funding barrel. So it’s partially funded. It’s not directly funded. I have a little issue there, but at least money’s coming in for that. I just don’t know how they’re spending it. What you didn’t see through that bill is anything mentioning teacher training, anything mentioning measuring student outcomes, anything mentioning education methodologies, how we’re teaching, what we should be doing, anything regarding topics, right? Now, I’m going to move on to… That’s the bill, right? I’m going to move on to how they enforce the bill. I’m pulling up another document here. Education Code, subtitle F, Curriculum Program Services, Chapter 28, Courses of Study and Advancement. I’ll put a link in there for you as well. And we’re going to look at Section 28.0021. And this is how this is the additional things that Texas Education Agency said about this financial education and what should be implemented. They didn’t add much at all. In fact, there’s a ton of things missing. There’s many gaps. And we’ll cover that at the end when I go through a line by line ranking of where they’re doing good and where they’re failing. So the first line item here says, it shall include instruction in personal financial literacy, including instruction methods of paying for college and other post-secondary training. Now, I was thinking about that for a while. I think it’s good that every student should understand, going down the page a little bit, that every student should be completing the application for federal student aid. I think it’s good for college-bound students only. If the students aren’t going to college, what’s the point? In Texas, it’s 50 to 60% that go on to college or post-secondary education. So for a big portion of the class, it’s not needed. It’s not necessary. Now, I think it’s always good to encourage higher education and so forth, but I think that should be separate because this alone, to complete that application, have an understanding, that’s going to eat up five hours of education that, you know, 50, 40 to 50% of the class won’t need or won’t use. Um, so, uh, again, I don’t like when there’s, there’s just one random talk topic put in there. And my thought is it’s an easy way to eat up time and bring in the student counselor department or so forth. Now, do I feel that every student that’s going to college or considering should have direct and very comprehensive training on paying for college, selecting a college that delivers them a true ROI and one that is going to benefit them in the long run and how to keep debt low, what it means when they’re taking on debt and so forth? Absolutely, yes. But for the general personal finance topic, I want to address the near-term challenges that everybody in that class is going to face first and have side programs for those that have specific agendas and goals. So not that I’m against it. I just want, since we have such limited time, I want to have coursework in there that benefits 100% of students and so forth. So again, that’s a small issue I had there. But I think it’s good that it is including some mention of paying for college. I just don’t know about going through all those layers. They also do add in Section 28.0024 about a school-based savings program. I like that idea. They didn’t give much guidelines or ways to implement that. So I’d like to see that built out, but I really like that idea. And they also did mention engaging the adults in the family. with that. So I think that parental influence and parental participation in youth financial education is critical. And they just gave it one sentence that an adult in the student’s family jointly to have the opportunity to establish an account or purchase a bond under the subsection, right? So very little mentioned there. And again, the rest of what was mentioned in that document was more focused just on other things if you’re looking up that document just search for financial because it’s an 80-page document so it’s a financial letter she takes up about five six paragraphs in that entire document but it is good to see how they’re implementing that bill and most of it is just a rehash of what’s stated in the bill the two points I mentioned are new not stated in that bill initially so let’s get into a breakdown of this and I’m going to go line by line down this checklist I’m going to make this a little bigger here for you I’m going to go line by line down this checklist and really give Texas a grade again I have a little bias Texas resident love the state love the people but again their financial literacy standards are painfully low some of the lowest I’ve seen in the country first is it delivered in a standalone class? Nope, it is not. And in fact, I think there’s a huge risk because economic teachers are leading it that economics will eat into that two-thirds of the time supposed to be dedicated to financial literacy. Is there enough time or rigor? Absolutely not. 30, 40 hours of instruction on the subject is absolutely not enough time to get them to higher-order thinking skill sets, to get them to apply what they learned, to put them in a position where they gained enough knowledge and confidence on the subject matter to make a real and true difference in their life. In addition, there was no mention of specific age ranges. So if they’re delivering this in ninth or 10th grade, there’s a huge risk of learning loss by the time they need it. If it’s 12th grade, because there’s so little time dedicated, learning loss will be steep unless they’re applying things they learned right away. Conduct ongoing education to support long-term outcomes. Absolutely not. There’s no mention of that. All other subjects have some type of ongoing pathway if you’re studying anything in high school and you’re going to college there’s an ongoing training pathway but for financial literacy nothing was mentioned again today with technology we have easy ways we can communicate and continue educating our youth And these schools need to leverage technology. It’s simple to communicate and provide them timely financial education. But so far, I have not seen one state successfully do that or even attempt that. And it’s very easy to do. Next, do they have relevant content that prepares students for near-term life events? Nothing was mentioned at all about the topics required or anything like that. They didn’t mention building out the, you know, filling out the FAFSA form. That’s one topic. They didn’t get into the topics. And everything we see success is when things are built around life stages, moving out on your own, opening your first accounts, avoiding, you know, when you’re 18, you get inundated with credit card offers, avoiding debt. choosing a college that has you know get delivered an ROI all those things are life stage events that we can prepare students for and based on the students’ need there should be breakout trainings for specific pathways so absolutely fail there adopt proven curriculum that encourages higher-order thinking and application absolutely not they want free resources that are open source and found online absolute joke it’s embarrassing i don’t know where my tax dollars goes for education it’s not to the teachers sadly we have teachers out there know some great things some high performing teachers getting no bonuses no support in addition it’s not going to the students’ curriculum on this subject matter maybe other subject matter but not personal finance absolute failure and I’m embarrassed by what they stated here in that document customize lesson plans based on student needs. Nope, nothing was customized. And there’s a big difference based on where we’re teaching people rural. You know, just driving out of North Dallas, where I’m at in the Frisco area, just driving an hour north, right? You get into the farmland, rural, you go down south, it’s a city. There’s so much diversity here in terms of socioeconomic status and people and the way people are engaging. There needs to be some customization of lesson plans to ensure we’re meeting their needs. That was not mentioned at all, so absolutely. Failure there. If we continue down the path, educator and leadership, courses led by highly qualified educators, absolutely no mention of it there. And teaching economics is completely different than teaching personal finance. And the reason is very clear. Economics, there’s no emotional attachment, behavior issues, habits formed, different goals, right? In economics, there’s economic facts and principles and theories and so forth that you could teach. With personal finance, every kid has different parents, different socioeconomic status, different habits, different goals, different path of life that they want to do. And it’s not the same subject. We need to know behavioral finance, financial psychology, education methods to help build up reasons and develop. How do we get them to apply what they learn. Completely different subject matter. There needs to be specialized training and there is not fail there as well. Programs developed and deployed by managed and experienced leaders. No mention of that. Any successful business knows you need to have successful people that have built out. You’re not going to hire somebody. If you’re trying to build up some type of program for a Fortune 500 company, they’re not going to just put some random person in that role to fulfill that. Here, there’s nobody specified, no qualifications mentioned, nothing that says you need somebody that has experience building hundreds of financial education programs and having a track record of success. Absolute fail there as well. Learner outcome focused assessments. No mention as well. Most of these mandates that I see, they just have content knowledge assessments, pre- and post-tests that shows you know the content. But again, with personal finance, we need to measure behaviors, sentiment, which is confidence. Systems they’re establishing. For instance, tracking the amount of people that open up. That savings plan would be a great, easy way to give empirical data. No mention there again. Unlike any other subject, they all have standards and outcomes very clearly mentioned. Financial literacy, again, they’re treating it like some random topic. Funding, they’re basically taking from, they said they’re open to funding from the outside agencies, grants, and so forth. And I guess they get funding from the economics, the budget. So I, I’ll give them an okay there. Okay, simply because, you know, they are getting some type of funding. A lot of states I review have absolutely no funding and no budget to pull from. So at least they have something. What I would like to see here is dedicated funding for personal financial literacy class. I’ll be generous here. Just as a resident, I want to give them an okay score on that because there is some funding coming in. So No bias free on that one, but it is. Yeah, I’ll give them an okay there. Start lessons in elementary school. Now, part of what I did not mention, there is a line in there that says from kindergarten through eighth grade, they will include some, they want them to include financial education in elementary school in that part of their math stipend. So it is mentioned there. So I think that’s good. I don’t think that is enough um I think that should be integrated in many different subjects and uh but yeah that was a line item in here um so I’m trying to find it here right now I don’t see it off the top of my head but I did see that I did make note of that and I do like that whole concept of including that in there so I will give them a okay here as well again. They didn’t define the rigor. They did not define how much they needed to include, which gives the teacher more leeway than I’d want them to do. I want teachers to have clear directives, not telling them what to do, but clear directives. Here’s what the outcomes we want of these students. Here’s how to test to make sure they understand the concepts. And here’s what lessons we want. And I think there’s ways to integrate financial literacy in classes beyond just math and K through eight. English they can do assignments on that I know literacy numeracy are key things in the skill development of elementary school students there’s a lot of ways we can integrate personal financial literacy in there even in history and so forth talking about money and what motives of different things that are happening and where people are getting funding and how they were able to build things so think there’s opportunities I’m glad they mentioned it most states do not so good job Texas but you only get okay there because there’s no clear directives for educators and finally encourage parental involvement and provide parents with resources I did like the fact they mentioned parents in the savings bond or savings fund portion of it, it was not talking about the education so I’m gonna have to give them a fail for that. So some big problems across the board here for Texas. We have a long way to go and just an overview of their grades. That’s what we’re looking at right there. Again, my goal is not just to beat them up. I want to provide help and support. We do that. We have very clear framework and policy for legislators enacting these builds. So we don’t get garbage like this that will make no difference in a student’s life. All I want, very basic, financial literacy to meet the minimum education standards of other topics, right? Second is every student graduates able and confident to make near-term financial decisions so they don’t get in trouble. Now, can we guarantee that? Absolutely not. But there’s things that we can do to test and monitor and check their behaviors and confidence in doing that. And we can take longer-term measures that can prove that over time. What it will take is increased rigor, quality teachers, clear outcomes, good quality curriculum, and those other things we saw there. So I work with legislatures in helping them shape financial literacy bills. We’ll provide this guide for anybody out there that wants it. And if you are an advocate and want to see youth have higher standards for financial literacy education so they graduate able to get a job, be self-sufficient, be contributing members of society, join us. And I look forward to the next review where we’re going to take on California.