Financial literacy needs to be a staple of the American education system, U.S. Secretary of Education Arne Duncan said at Pensions & Investments' Investment Innovation and the Global Future of Retirement conference.
“When you look at the baby boomer generation moving toward retirement, when you look at a lack of savings, when you look at how insecure people are as they move toward retirement, as a nation, I worry tremendously about the financial viability of families,” Mr. Duncan said in a June 23 keynote speech at the Waldorf Astoria in New York.
Mr. Duncan was interviewed by Mellody Hobson, president of Ariel Investments LLC, Chicago.
He said seeing so many families without savings or a basic understanding about how to prepare for retirement has him worried about the future.
“The lack of preparation for retirement, the lack of savings, particularly among the black and Latino populations, is devastating,” Mr. Duncan said. “I'm a huge proponent of education as a tool to help move families out of poverty.”
Although he was happy to see a number of states start financial literacy programs for high school students, Mr. Duncan likened financial literacy education to learning a foreign language in that it's something that should be taught as early as possible.
“If our young people aren't financially literate, we are part of the problem, not part of the solution. And as a nation, we have a huge problem.”
He also noted it's a topic that students find interesting.
“This is a great way to teach math. Kids care about money,” he said. “Rich, poor, black, white; it doesn't matter. This isn't an add-on or extra (to the curriculum); this is a really interesting way to engage students.”
This is part-and-parcel of what Mr. Duncan believes is the solution to raising graduation rates and lowering dropout statistics — making sure the curriculum is engaging and challenging, and not dumbing down the material.
“Many young people drop out of high school not because it's too hard, but because it's too easy. They're not challenged. So if we raise the bar, that'll help increase graduation rates,” said the education secretary.