TRENTON – A bill sponsored by Senate Majority Leader Steve Sweeney which would create a three-year pilot program to provide high school students with financial literacy education was approved by the Senate Budget and Appropriations Committee yesterday by a vote of 13-1.
“A major underlying factor in the economic collapse going on around the nation and around the world is a fundamental ignorance about personal finance,” said Senator Sweeney, D-Gloucester, Cumberland and Salem. “People have lived beyond their means for a long time, and have not recognized the consequences until it was too late. We need to educate future generations about the basics of financial literacy, so that hopefully we can avoid the credit card mentality which has helped to drag down our economy in New Jersey and around the country.”
The bill, S-2211, would require the Commissioner of Education to establish a three-year pilot program to provide high school seniors with financial literacy instruction in selected school districts. Under the bill, the Commissioner would select six districts to participate – two in South Jersey, two in Central Jersey, and two in North Jersey – and would select these districts to represent a cross section of urban, suburban and rural districts in the State. The Department of Education would be required to provide sample curriculum and instructional materials, a grant to each pilot district to offset the cost of offering the financial literacy instruction, and a report to the Governor and the Legislature at the conclusion of the pilot program on the implementation of the curriculum within the pilot districts, and the possibility of implementing a State-wide financial literacy program.
According to Senator Sweeney, national statistics show that students are accumulating debt at an early age, and making unwise financial decisions. A CBS News report in 2007 noted that almost one-third of high school seniors and more than three quarters of college freshmen nationally have already accumulated credit card debt. The Center for the New American Dream found that over half of all college students in the country carry four or more credit cards by the time they leave school. These numbers are most likely even higher as college students look for ways to fund their education during the current economic crisis.
“Kids will always make some bad decisions, but accumulating thousands of dollars in credit card debt is a mistake that can follow them around for a long, long time,” said Senator Sweeney. “We need to give students the tools and resources they need to avoid bad choices that will have an effect when they apply for a job, try to get car insurance, or attempt to purchase a home. Through this legislation, we can give kids the foundations for solid personal finance, and help them avoid costly mistakes which will come back to haunt them.”
The bill now heads to the full Senate for consideration.