As the back-to-school season is finally upon us, it is encouraging to think about all that our children will learn in this new academic school year. I was among the many parents in Arizona packing lunch boxes and taking the traditional “first day of school” photos of my children. As they headed into their new classrooms, I smiled, thinking about all of the opportunities they will have.
This school year, Arizonans have something new to smile about as all our high school students will be taught financial literacy during their economics class as a requirement before they graduate. This change is due to legislation I advanced during my first weeks in office as the state treasurer. SB 1184 passed through both the Senate and the House of Representatives with wide, bipartisan support and was signed by Gov. Doug Ducey on April 11.
The importance of Arizonans knowing the basics of personal money management being taught in schools became obvious 12 years ago, when I spoke at a student orientation for freshmen being introduced to college life. As I walked to the ballroom, where I was to give a 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 to 34, 1 in 8 individuals have debts in collections.
• 39% of millennial women don’t pay their bills on time and are twice as likely as 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
As Arizona’s newly elected treasurer, it was important for me to continue my advocacy of financial education and make this important issue a cornerstone of my administration. My financial literacy bill was just the start. In June, I appointed Arizona’s first task force on financial literacy, aimed at making sure all Arizonans will have the opportunity to attain proficiency in basic money management. This 17-member task force is already taking the next steps to bring resources to students, seniors, military veterans and vulnerable populations who need help with managing their money across our great state.
While the task force is hard at work, our high school students will be starting the new school year with learning the basics about personal finances. This is a critical life skill. Finally, Arizona students will be prepared to manage their money before going out into the world as adults. They will be taught the basic skills of balancing their checkbook and understanding the consequences of not paying off credit card debt month to month. Financial education empowers young people to achieve financial freedom so they can attain their personal and professional goals. With that freedom, our young people can achieve anything.
Kimberly Yee is the treasurer of Arizona. She oversees the cash management of Arizona’s $40 billion state budget and payments to agencies, local governments and schools and manages $16 billion in assets under management.