Jun 27, 2024

California to add financial literacy as a requirement to graduate high school

What you need to know: California is ensuring that all high school students are taught personal financial literacy before graduating after an agreement between state leadership and NGPF Mission 2030, an affiliate of Next Gen Personal Finance was reached.

SACRAMENTO – Governor Gavin Newsom, Senate President pro Tempore Mike McGuire (D-North Coast), Assembly Speaker Robert Rivas (D-Salinas), and a national financial literacy non-profit — NGPF Mission 2030, an affiliate of Next Gen Personal Finance — today announced an agreement to make financial literacy required content to graduate high school.

“We need to help Californians prepare for their financial futures as early as possible. Saving for the future, making investments, and spending wisely are lifelong skills that young adults need to learn before they start their careers, not after.”

Governor Gavin Newsom

Senate President pro Tempore Mike McGuire (D-North Coast): “Financial literacy is a critical tool that pays dividends for a lifetime. There’s a wealth of data about the benefits of learning these valuable lessons in high school, from improving credit scores and reducing default rates to increasing the likelihood that our future generations will maintain three months of savings for emergencies and have at least one kind of retirement account.”

Assembly Speaker Robert Rivas (D-Salinas): “Ensuring our students have the skills and knowledge to thrive is paramount to California’s continued success, and financial literacy is a key part of that educational mission. Our agreement is the culmination of many robust and productive conversations with stakeholders across the state on how best to implement financial literacy into every student’s high school curriculum.”

Tim Ranzetta, co-founder of NGPF and lead proponent of the Californians for Financial Education initiative campaign: “We commend Governor Newsom, Senate President pro Tem McGuire, Speaker Rivas, and the bill’s authors and supporters for their leadership and commitment to guaranteeing access to one semester personal finance education for every California student. We look forward to supporting the implementation of this essential course.”

This agreement is reflected in AB 2927, sponsored by NGPF Mission 2030, which the Governor will sign. The legislation will require a semester-long personal finance education course available for all California high school students by the 2027-28 school year and make personal finance a graduation requirement starting with the 2030-31 graduating class. 

Once the Legislature passes this legislation, proponents of the California Personal Finance Education Act initiative eligible for the November 2024 ballot have agreed to withdraw their measure.

College savings accounts

The financial literacy bill aligns with state efforts to prepare students early on for a healthier financial future. California’s CalKIDS program invests $1.9 billion into accounts for low-income school-age children in grades 1-12 and for newborn children born on or after July 1, 2022 – indicating the need for early financial literacy. All families of low-income public school students – 3.4 million across the state – are able to access college savings accounts created in their children’s names.